Local demand not enough to sustain industry growth

CEBU, Philippines - Although the furniture industry acknowledged that the active domestic market have been able to serve as the “industry’s savior” during the difficult global market situation, industry players said local demand cannot sustain the life of the business.

“We really have to go out there and look for more markets abroad. Domestic market is only a ‘band-aid’ solution especially that local sales come from institutional clients and demand is not constant,” said Cebu Furniture Industries Foundation Inc. (CFIF) president Angela Paulin.

Paulin however, admitted that the shift of other furniture companies to entertain local clients had made the industry survived, but focusing on local market alone, can not sustain the industry’s life-long survival.

At the height of the global crisis, most furniture companies in Cebu were able to get good orders from local institutional clients, such as new hotels and resorts in famous tourism destinations, like Boracay, and big clients in Manila, and in Cebu.

Besides, she said there are also a lot of furniture companies in Manila that have already penetrated the local market that makes the competition much tougher, given the limited scope of market.

On the other hand, while the economy is expected to pick up this year, Paulin said furniture companies are continually investing on looking for other alternative export markets, and at the same time strengthening its presence in the recovering US market.

While the general outlook is sunnier for furniture industry starting this year, Paulin said the industry players still have see the real “market pulse” in the first three months of 2010.

“While there has been slight activity- with orders coming in during the last quarter of this year- furniture players are taking a conservative stance. We need to see how the industry will perform”said Paulin.