Dedon to retain Cebu plant

CEBU, Philippines - Despite being hit by the global economic crisis, one of Cebu’s largest furniture exporters Dedon Manufacturing vowed to retain its plant in Cebu.

Dedon president Herve Lampert said in an interview that the company is here for long term owing to Cebuanos’ good skills in craftsmanship and design.

This German-owned furniture company employs about 3,500 direct workers, excluding thousands of sub-contractors.

Because of the weakening furniture demand, Dedon has retrenched over 300 people in the last few months, leaving the company now with a little over 3,000 workers.

“We had been in different countries like Vietnam, but we decided to settle here in Cebu,” Lampert said.

He said Dedon, which has been able to carve its furniture brand in the world market, has not been spared from the dwindling demand brought about by the global recession, however, he said the company is fighting to sustain its business here, and with these “trying times” it hopes to gain immediate support from the government.

In a position paper submitted to PhilExport-Cebu, Lampert said that this time calls for drastic measures on the part of the business sector, to counteract the effects of the global financial crisis.

“Businesses cannot stand on their own, for they are regulated by laws and policies that govern trade, crafted to boost the economy of the country, and therefore must interface with the government, suppliers, and customers,” Lampert’s letter to PhilExport-Cebu reads.

Although, the company has promised to stay in Cebu, he said extraordinary support from the government should be implemented, even just for a temporary time.

Lampert sought the help of PhilExport-Cebu, the support umbrella organization of the export sector here.

“As a business, we have implemented cost-cutting measures, to increase and ensure our chances of surviving the crisis. However, these measures are not enough. If the prognosis of many observers is on track, then definitely, the business sector must turn to government for help. Perhaps, not in terms of funds infusion, but in terms of putting provisions that could cushion the blow of a crisis that threatens to snuff the life of businesses across sectors,” Lampert stressed.

PhilExport-Cebu led by chairman Allan Suarez and president Jay Yuvallos, carried over the concerns identified by Dedon, during the sector’s special meeting with Department of Finance (DOF) secretary Margarito Teves.

According to Suarez, Dedon’s concern speaks all through the export industry sector, as they are in the same difficulty, may it be big or small company.

Lampert specified some areas wherein the government could bend their support to the bleeding industry, including proposed incentive on importation of raw materials, scrap long documentary processes, taxes on sales, among others.

 “We hope that our concerns will be taken into serious consideration by the Philippine Government, with the support of PhilExport, to advocate for a business enabling environment through good governance,” Lampert said in his letter.

The entire furniture industry in Cebu, had already retrenched close to 20,000 workers in the last few months. Industry players said that if the market will not show recovery, a 30 percent further contraction of labor pool is expected this year.