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Furniture industry reshuffle intensifies the cultivation of brand development channels into a way out
The furniture industry has undergone significant changes this year, with a lot of discussions about its future direction. Ah Jin mentioned that this year's major shift in the furniture market is no longer just about making profits through strong sales and effective marketing models. Companies that can't adapt to the evolving market are gradually disappearing.
Whether it's the furniture industry in Shunde or the broader Chinese furniture sector, a new transformation is urgently needed to overcome the current sluggish conditions. Industry experts believe that property market regulations won't change overnight. Therefore, the furniture industry must be mentally prepared for a long-term struggle and seek out new paths forward.
Furniture factories are now visible everywhere, from national highways to local streets. According to locals, only companies with an annual turnover of at least 10 million yuan can afford to build large advertising signs along the Shunde National Highway. In Shunde, there are many such enterprises, some of which have been operating for over a decade. Before 2000, most furniture factories in Shunde were profitable. "At that time, as long as you opened the factory, everything went smoothly," said Chen Sheng, a veteran in the furniture industry. Back then, there was no need to open stores or find dealers—cars from all over the country would line up at the factory door to buy goods. "Back then, gross profit could exceed 50%, but now it’s hard to reach even 20%."
As the furniture industry grows, it eventually reaches a ceiling. Many large furniture factories in the Shunde area choose to diversify their operations once they reach a certain scale. They invest in steel, textiles, real estate, credit, and other sectors, while the furniture business becomes a smaller part of their overall activities.
According to officials from the Guangdong Furniture Association, China's per capita furniture consumption is still far below that of developed countries in Europe and America, meaning there is still a lot of room for market growth. In the future, competition in the furniture market will no longer be solely about manufacturing capabilities—it will involve product development, marketing, branding, communication, and management.
Zhang Yuncheng, a furniture industry observer, believes that the industrial chain of the Foshan furniture cluster is relatively complete and efficient. However, the overall strength of the industry is not yet strong enough. To reverse the decline, the focus should be on developing brand strategies and cultivating influential big brands to accelerate regional industrial upgrading.
A marketing manager from a well-known furniture brand believes that expanding into multiple channels is an effective way to share risks. The multi-channel model typically includes domestic and international markets, direct stores combined with distributors, private brand production alongside OEMs. "Our main strategy is the dual-channel approach of domestic and international markets," the manager explained. Over the years, the brand has expanded its domestic presence while also focusing on foreign markets. "We emphasize an international perspective in our product design. At our exhibitions in March and September, more foreigners than Chinese attend." The brand's annual sales are around 200 million yuan, with foreign sales accounting for three-quarters of total revenue. This year alone, the Japanese market brought in tens of millions of yuan in orders, and the South Korean and Dubai markets also performed well. Additionally, the brand is adopting a multi-channel strategy in the domestic market, "mainly through dealers, supplemented by direct stores."