Furniture makers encouraged to explore the Indian market

CEBU, Philippines - While the “bread and butter” markets of the furniture exports industry—United States and Europe, are still under-pressure, furniture makers are encouraged to seize the US$17 billion furniture market in India.Indian International Furniture Fair project manager Lindsay Teopaco said that Indian consumers for furniture is significantly growing as it could reach US$17 billion in size in the next five years.

 In a report by PhilExport, Teopaco was quoted as saying the growth drivers for the industry are tourism/hospitality, real estate and housing boon, information technology (IT) and IT-enabled services, as well as the significantly improving consumer demographics.

According to Teopaco, there is a big demand from the hospitality sector in India. “Hotels are coming up over India. And we all know that India is an IT hub. Business Process Outsourcing [BPO] are coming up, so there is a big demand for office furniture as well,” said Teopaco.

The residential segment comprises 65 percent of the Indian furniture industry, office on the other hand is 20 percent, and contract, 15 percent.

She said the high-spending of India’s middle class population, now reaching 300 million, is boosting the growth of the residential market.

The contract office segment on the other hand, is driven by the expanding growth in real estate and office construction while contract by growing hotel developments and tourism related demand, she said.

The increasing income levels and consumption are also big factors in consumer spending in India, she added.

In order to penetrate this huge and potential market, she said local furniture exporters should start a massive promotional campaign to aid, and create a strong and aspirational brand and differentiation through service and quality.

She warned that local market adaption is also crucial, considering that each country has different buying behavior.

“They [furniture exporters] have to look for the right business partner and develop local supply chain” she said adding that offering a dynamic and strategic product range is very important.

“Exporters should understand what type or product design. It maybe wood, since they are strong in wood. But exporters have to see for themselves, and test the market,” she added.

Significantly, Teopaco underscored the importance of competitive pricing structure. She said the market in India would like to bargain a lot “so you have to make sure you bring your right product,” she advised exporters.       

Based on India’s Economic Advisory Council, India is poise to be the world’s third largest economy this year, posting an economic growth of 8.2 percent.

In fact, the International Monetary Fund has projected that India’s economy will experience growth to US$3.1 trillion in real terms in the next ten years.

Meanwhile, in an earlier interview with Indian Ambassador to the Philippines Rajeet Mitter, he said that Cebu-based furniture exporters should discount the Indian market for high-end furniture, as there is now a fast growing community in India, which can afford to buy expensive home furnishings.

Out of 1.1 billion population in India, a fast growing percentage of which are going up to the middle-end ladder in terms of income. These people he said are looking for quality products, regardless of price, and Cebu’s renowned upscale furniture could easily penetrate on this growing market. (FREEMAN)