Centre for wood and furniture industry studies Versailles, 04/11/2005 THE GLOBAL FURNITURE MARKET European Hardwood Conference Versailles, Friday 4 November

Centre for wood and furniture industry studies Versailles, 04/11/2005

THE GLOBAL FURNITURE MARKETTHE GLOBAL FURNITURE MARKET

““European Hardwood Conference”European Hardwood Conference”Versailles, Friday 4 November 2005Versailles, Friday 4 November 2005

Teresa Gargiulo, Federlegno-ArredoTeresa Gargiulo, Federlegno-Arredo


A HUGE GLOBAL BUSINESS

Furniture is the largest low-tech sector worldwide with an estimated total production of

about 220 billions of euros.

Europe is the largest furniture producer, but Asia is performing

increasingly better.

Fig. 1. WORLD FURNITURE PRODUCTION AND CONSUMPTION BY REGIONSWORLD FURNITURE PRODUCTION AND CONSUMPTION BY REGIONS.

Per cent, 2004.

2


35,0%

27,2%

27,7%

35,9%

37,3%

36,9%

0% 5% 10% 15% 20% 25% 30% 35% 40%

OTHERS

NAFTA

EU15

consumption

production

Fig. 2. WORLD FURNITURE IMPORTWORLD FURNITURE IMPORT.

Million dollars, 1985-2000.

In the last ten years furniture trade grew faster than others traditional products trade.

Last year the total global furniture trade worth was 70 billion euros.

THE FAST OPENING OF INTERNATIONAL MARKET


12.760

30.488

49.229

68.342

0

10.000

20.000

30.000

40.000

50.000

60.000

70.000

1985 1990 1995 2000

The opening rate (Import/Consumption) of furniture international market reached

more than 30%.

THE GLOBAL FURNITURE MARKETTHE GLOBAL FURNITURE MARKET 3


Tab. 1. WORLD FURNITURE IMPORT BY REGIONWORLD FURNITURE IMPORT BY REGION.

Billion euro, 2004 .

EU15 is the most important market, followed by NAFTA; together they cover the

80% of total world import…

DEVELOPING REGIONS ARE LEADING THE MARKET GROWTH

4


Regions/Countries ValueGrowth rate in 2004 (%)

EU 15 29,4 5,5%

EU New members 2,5 19,5%

NAFTA 25,6 3,9%

Russia 1,3 22,0%

OTHERS EUROPE 3,2 7,6%

China 0,6 15,1%

Japan 3,1 -0,1%

OTHERS ASIA AND PACIFIC 2,6 15,5%

MIDDLE EAST 1,3 9,4%

LATIN AMERICA 0,2 45,1%

AFRICA 0,4 28,6%

WORLD 70,2 6,1%

…but Asia, Russia and EU10 are leading the market growth.


The main three players are China, Italy and Germany.

Traditional main playerslike, Italy and Germany show relatively low trends.

Fig. 3. WORLD FURNITURE IMPORT BY SUPPLIERSWORLD FURNITURE IMPORT BY SUPPLIERS.

Billion euro, 2000-2004.

GLOBAL FURNITURE MARKET SUPPLIERS

5


66,864,062,5

66,170,2

7,99,1

11,512,2

14,4

7,3 7,7 7,3 7,3 7,3

5,4 5,5 5,5 5,6 6,1

0,0

5,0

10,0

15,0

20,0

2000 2001 2002 2003 2004

0,0

10,0

20,0

30,0

40,0

50,0

60,0

70,0

80,0

WORLD

CHINA

ITALY

GERMANY

China, Italy, Germany WORLD

In the last five years China doubled its market share.


Tab. 2. WORLD FURNITURE IMPORT BY SUPPLIERSWORLD FURNITURE IMPORT BY SUPPLIERS.

Billion euro, 2004.

China and Poland are the more dynamic new players.

Labour cost, design and forest resources are the key-leading factor in

international furniture production specialization.

DEVELOPING COUNTRIES ARE BECOMING WORLDWIDE MAIN PRODUCERS

6


Suppliers Value % Growth rate 2000-2004

1° China 14,4 20,5% 62,3%

2° Italy 7,3 10,4% -11,3%

3° Germany 6,1 8,8% 1,9%

4° Canada 4,1 5,9% -31,7%

5° Mexico 4,0 5,7% -4,6%

6° Poland 3,5 4,9% 33,2%

7° Usa 2,9 4,1% -45,3%

8° France 1,8 2,6% -18,8%

9° Indonesia 1,6 2,3% -19,3%

10° Denmark 1,6 2,3% -6,9%

Others 22,7 32,4% -0,5%

WORLD IMPORT 70,2 100,0%


Tab. 3. LEADER’S FURNITURE IMPORT SHARES BY REGIONSLEADER’S FURNITURE IMPORT SHARES BY REGIONS.

Shares (%), 2004.

China is the leader supplier in NAFTA and others Asian countries.

WORLD FURNITURE LEADERSHIP BY REGIONS

7


Regions/Countries Leaders Share

EU 15 Italy 14,1%

EU New members Germany 24,7%

NAFTA (Usa, Canada, Messico) China 34,2%

Russia Italy 30,8%

OTHERS EUROPE Germany 23,3%

China Germany 33,7%

Japan China 37,7%

OTHERS ASIA AND PACIFIC China 34,8%

MIDDLE EAST Italy 20,4%

LATIN AMERICA Usa 22,9%

AFRICA Italy 20,8%

WORLD China 20,5%

Italy is the leader supplier in EU25, Middle-East and Africa.

Germany is the leader supplier in EU10, in Other Europe countries and in China.


Tab. 4. EU15’S MAIN FURNITURE SUPPLIERSEU15’S MAIN FURNITURE SUPPLIERS.

Billion euro, 2004.

China and Poland are increasingly gathering quotas on European import.

NEW PLAYERS IN EUROPE (1)

8


Suppliers Value %

1° Italy 4,2 14,1%

2° Germany 3,8 12,9%

3° Poland 2,6 8,9%

4° China 2,6 8,9%

5° France 1,2 4,1%

6° Denmark 1,1 3,6%

7° Spain 1,0 3,3%

8° Czech Republic 0,9 2,9%

9° Indonesia 0,8 2,8%

10° Netherlands 0,8 2,8%

Others 10 35,7%

EU 15 IMPORT 29,4 100,0%

Western Europe Countries play a major role in European furniture Industry.


Fig. 4. EXTRA-UE15 FURNITURE SUPPLIERS OF EUROPEAN IMPORTEXTRA-UE15 FURNITURE SUPPLIERS OF EUROPEAN IMPORT.

Per cent, 2004.

If we look at import data without considering EU15 members trade, China and Poland

have similar quotas of about 19 per cent.

NEW PLAYERS IN EUROPE (2)

9


Poland18,8%

China18,7%

Czech Republic6,1%

Indonesia5,8%

Romania5,0%

Slovenia3,6%

Turkey2,8%

Switzerland2,9%

South Africa3,0%

Vietnam3,2%

Others30,0%

Main followers are Czech Republic, Indonesia and Romania.


Tab. 5. LEADER’S FURNITURE IMPORT SHARES BY EU15’S COUNTRIESLEADER’S FURNITURE IMPORT SHARES BY EU15’S COUNTRIES.

Shares (%), 2004.

Poland is the leader supplier in Germany.

MAIN EUROPEAN PLAYERS

10


Countries Leaders Share

1° Germany Poland 21,1%

2° United Kingdom Italy 20,9%

3° France Italy 22,5%

4° Belgium Germany 23,5%

5° Netherlands Germany 28,1%

6° Austria Germany 48,1%

7° Spain France 17,6%

8° Sweden Denmark 15,1%

9° Italy Germany 13,5%

10° Denmark Sweden 17,2%

11° Portugal Spain 37,4%

12° Ireland united Kingdom 41,1%

13° Greece Italy 34,7%

14° Finland Sweden 31,3%

15° Luxembourg Germany 59,3%

EU15 Italy 14,1%

Germany is the leader supplier in Central Europe.

Italy is the leader supplier in France, United Kingdom and Greece.


Fig. 5. WORLD FURNITURE IMPORT BY PRODUCTSWORLD FURNITURE IMPORT BY PRODUCTS.

Per cent, 2004

Parts and Upholstered furniture have the most important quotas.

PRODUCTS

11


Special furniture1,7%

Parts27,7%

Others10,6%

Chairs12,9%Office furniture

4,4%

Upholstered12,5%

Other wood furniture19,4%

Kitchens3,7%

Bedroom furniture7,2%


Tab. 6. LEADER’S FURNITURE IMPORT SHARES BY PRODUCTSLEADER’S FURNITURE IMPORT SHARES BY PRODUCTS.

Shares (%), 2004.

Traditional players win in more specialistic products

LEADERS BY PRODUCTS

12


Products Leaders Shares

Bedroom furniture Cina 26,6%

Kitchens Germania 28,0%

Other wood furniture Cina 22,8%

Upholstered Italia 23,7%

Office furniture Canada 16,7%

Chairs Cina 29,9%

Special furniture Germania 19,8%

Parts Messico 16,2%

Others Cina 35,7%

Tot Furniture Cina 20,5%


Traditional players aim at lowering their costs, increasing the

added value, opening new markets (i.e. to have a better access

to third country markets).

A NEW GLOBAL VALUE CHAIN

13


New players aim at increasing theirs weight on international

trade and to upgrading the quality of their productions.

These forces, via FDI, are defining a new global value chain in

the world furniture market.

Documents

Centre for wood and furniture industry studies Versailles, 04/11/2005 THE GLOBAL FURNITURE MARKET European Hardwood Conference Versailles, Friday 4 November