Indoor & Outdoor Furniture

Transcription

1 Sample pages only To order the full report please refer to the last page Indoor & Outdoor Furniture Essential sourcing intelligence for buyers Indonesia manufacturer profiles Detailed profiles of 30 suppliers with verified manufacturing and export credentials Banda Aceh Thailand Sumatra Malaysia Singapore Jakarta Bandung Java Brunei Malaysia Yogyakarta Surabaya Bali Sulawesi Philippines Product & price trends Prices and specifications of 91 top-selling export products Design & material innovations Coverage of the latest trends in materials, style and finish April 2008 US$100

2 Indonesia Sourcing Report

3 EXECUTIVE SUMMARY INDOOR & OUTDOOR FURNITURE Supplier capability in Indonesia Executive Summary Indonesia has made a name for itself in the global indoor and outdoor furniture industry through its exquisite craftsmanship and low minimum order requirements. The intricate weaving and woodcarving, as well as the wide range of available wood have helped the country generate export sales of more than $2 billion in The Indonesia Furniture Industry & Handicraft Association (Asmindo) expects this to increase significantly by end However, makers in Indonesia are being cautious as several challenges threaten to cut their margins. Rising raw material and transportation costs, growing demand for environmentfriendly products, and intensifying competition from other countries in Asia are some of the major issues suppliers need to address. But despite all of these, Indonesia is poised to play a more active role in the international market for wooden furniture. Suppliers are gearing up to release innovative designs that combine function and style, and reflect both cultural and modern trends. Makers are also releasing furniture with more intricate handcarved designs or weaving. The following are some of the key trends we see in Indonesia s indoor and outdoor furniture industry: Exports in the line are anticipated to increase in 2008, with the US expected to lead worldwide demand. However, many suppliers will be targeting the European market within the year. Many companies will increase export prices by Q as raw material costs continue to rise. In fact, half of the makers surveyed for this report plan to do so. The companies that are considering price increases will likely implement small changes. Seventy-three percent of the respondents that plan to raise their quotes will limit increases to about 10 percent. In the next 12 months, suppliers will focus R&D efforts on releasing furniture made of less expensive wood to keep quotes down. For instance, makers have already begun using lumber from fast-growing and fruit-bearing trees. Some suppliers, on the other hand, have started to expand their base of wood sources. Makers will continue to address the growing demand for responsible forest use by sourcing wood from FSCcertified or government plantations. This report covers all types of indoor and outdoor wooden furniture produced in Indonesia, including chairs, tables, cabinets, beds, consoles and furniture sets. Most suppliers focus on just two or three products, and tend to use just one or two materials in their furniture. The Products & Prices section in this report details the features and price ranges of furniture made in Indonesia. This includes the latest trends in style, materials and finish. The Industry Overview discusses key issues affecting exporters and elaborates on the composition of the industry, highlighting key characteristics of different types of suppliers. The majority of furniture makers in Indonesia are privately owned, while a few are foreign-invested. This report reflects the nature of the industry with 90 percent of featured suppliers wholly Indonesia-owned. Many of the foreign investors are from the Netherlands. Production of indoor and outdoor furniture is concentrated in Bali, Yogyakarta and Java, where the majority of companies interviewed for this report are based. Nearly half of surveyed suppliers have factories in Bali, while a third have facilities in Java. In this report 16 in-depth company profiles 14 short company profiles 91 top-selling export products Supplier demographics Supplier survey Industry statistics and charts OBJECTIVE & METHODOLOGY This Indonesia Sourcing Report is part of a series designed to provide buyers with information on new products from export manufacturers in supply markets that specialize in handcrafted merchandise. The Developing Country Sourcing Report series is part of Global Sources corporate social responsibility initiatives, offered in conjunction with the Kearny Alliance, whose mission is Aid Through Trade, to help create jobs in developing Asia through export promotion. To produce this report, Global Sources surveyed larger, midsized and emerging manufacturers all with substantial export experience. The selection of suppliers is designed to reflect the composition of the industry in Indonesia in terms of geographic location, materials used and range of products offered. For in-depth profiles, our researchers visited the facilities of each company and interviewed senior executives who discussed their recent performance and provided forecasts for the next 12 months. All other companies in this report were either visited or contacted by phone. In each case, companies were required to answer specific questions designed to verify their manufacturing and export credentials, including a breakdown of exports by product type and market. Suppliers also participated in a survey designed to provide insight into the industry.

4 CONTENTS CONTENTS INDUSTRY OVERVIEW... 6 Supplier summary Export value PRODUCTS & PRICES... 8 Production & export statistics Price guides SUPPLIER SURVEY Export prices Export sales Export markets Major challenges Product trends SUPPLIER PROFILES Supplier matrix Supplier profiles PRODUCT GALLERY Top-selling export products SUPPLIER CONTACT DETAILS Copyright 2008 Trade Media Limited. All rights reserved. Reproduction in whole or in part in any form or medium without express written permission of Trade Media Holdings Limited and Trade Media Limited is prohibited. Published by Publishers Representatives Limited (on behalf of Trade Media Limited) P.O. Box 219 GT, Strathvale House, North Church Street, George Town, Grand Cayman, Cayman Islands c/o 22/F Vita Tower, 29 Wong Chuk Hang Road, Aberdeen, Hong Kong Printed in Singapore ISBN Disclaimer: Any recommendation contained in this report may not be suitable for all investors or businesses. Moreover, although the information contained in this report is obtained from sources believed to be reasonably reliable, the accuracy or completeness of such information cannot be guaranteed. The author and the publisher of this report (and the publisher s affiliates, agents, sales representatives and service contractors) do not make any representation or warranty whatsoever (whether express or implied) in relation to any of the contents of this report (including any information, opinion, recommendation or conclusion contained in this report) (collectively, Contents ), whether as to the accuracy, completeness, quality, fitness, suitability or reliability of such Contents (or any portion thereof ) or otherwise, and shall not be liable under any circumstances whatsoever for any error, omission, defect or deficiency in, or for any use of or reliance on, such Contents (or any portion thereof). All product images are provided by the companies interviewed and are for reference purposes only. Those product images featuring products with trademarks, brand names or logos are not intended for sale. Products that are not the specific topics of editorial articles are shown for illustrative and/or demonstrative purposes only. We, our affiliates, and our affiliates respective directors, officers, employees, representatives, agents or contractors, do not accept and will not have any responsibility or liability for product images (or any part thereof) which infringe on any intellectual property or other rights of a third party. Indonesia Sourcing Report

5 InDUSTRY Overview INDUSTRY OVERVIEW Indonesia is known for its rich tradition of woodcarving. Made from skills that have been handed down from generation to generation, handcrafted furniture produced by Indonesia s artisans has enabled the country to literally carve a niche for itself in the global wooden furniture market. Aside from exquisite craftsmanship, other factors that have enabled Indonesia to become one the top five exporters globally of wooden furniture are low minimum order requirements, acceptance of mixed orders and abundant supply of wood and other natural materials. In addition, the growing demand for wooden furniture has given the sector a boost, pushing export sales to more than $2 billion in And, with demand for wooden furniture expected to further increase, Indonesia suppliers anticipate more growth in the coming years. In fact, 77 percent of companies interviewed for this report expect their export sales to rise in 2008, with 23 percent anticipating an increase of more than 20 percent. However, despite promising market conditions, suppliers are being cautious as various challenges threaten to eat into their margins. One of the major problems furniture makers in Indonesia have to address is the rising cost of lumber. Wood prices have been on an upward trend for the past few years, mainly due to low supply and high demand. The rise in petroleum prices worldwide has also contributed to the price increase. For instance, the cost of wood, specifically teak and mahogany went up between 10 and 20 percent in 2007, with further increases expected. As costs of raw materials rise, suppliers are forced to increase export prices as well. However, the supplier survey done for this report indicates that price adjustments will be minimal. Seventythree percent of interviewed companies that plan to raise their quotes will do so by a maximum of 10 percent. In addition, the cost of other materials such as steel, aluminum, metal fittings, foam, paint and finishes has also risen considerably since mid To deal with rising production costs, many suppliers are exploring the use of other types of wood. Some companies have turned to engineered wood such as MDF and HDF, which are less expensive and more environmentfriendly, while others are using wood from fruit-bearing trees such as mango and durian, and from fastgrowing trees such as suar, white teak, eucalyptus and nyatoh. Although these types of wood are of lower quality, makers compensate with better design and production techniques. Another alternative material to wood is bamboo. Although technically a type of grass, bamboo is increasingly being accepted by buyers in the international furniture market. It used to be synonymous with low-end and inferior furniture, and is relatively more susceptible to termites and wood-boring insects. However, recent advancements in material processing and finish have enabled bamboo to be used in furniture targeted at the midrange and high-end markets. When treated appropriately, bamboo forms a material that is both lightweight and exceptionally tough. Another effect of escalating petroleum prices is the rising cost of transportation. To deal with this issue, many companies are streamlining their packaging and delivery systems. Jakarta-based Bokdesindo, for example, ships ready-to-assemble or knock down furniture pieces whenever possible to save on transportation and shipping costs. The growing demand for environment-friendly products has also resulted in more pressure on furniture makers in Indonesia. Various environmental groups and nonprofit organizations are lobbying for governments to sign agreements Supplier summary Suppliers surveyed 30 Export sales $37.2mn Export ratio 95% Capacity utilized 63% Full-time employees 4,407 Data: All surveyed suppliers with Indonesia on not purchasing products made from illegal timber. In fact, Norway, Finland and the EU have already signed such agreements. However, wood bought from legal sources such as government plantations is more expensive by 20 to 30 percent than that sourced from unverified producers. Furniture makers are also responsible for procuring the needed clearances, which translates to additional cost for them. Aside from government plantations, makers are also sourcing raw materials from companies certified by the Forest Stewardship Council (FSC) and the Indonesian Eco-labelling Institute. An FSC label certifies that 50 to 100 percent of wood used in the product was harvested by sustainable methods. For example, Jakarta-based Timbercraft Ecolestari, which specializes in timber products, uses only raw materials from FSC-certified forests and plantations. Another problem furniture makers in Indonesia are facing is the growing competition from suppliers from China, Malaysia and Vietnam. China s high degree of automation allows suppliers there to mass produce furniture at lower costs. Aside from this, China competes with Indonesia for raw materials supply. In fact, it is the biggest importer of Indonesia s hardwood, shipping in more than 120,000 tons of hardwood in In an effort to distinguish themselves from China suppliers, many companies in Indonesia are 6 Indonesia Sourcing Report

6 SUPPLIER PROFILES Arjuna Jati Furniture Arjuna Jati has been in the business of manufacturing and exporting indoor and outdoor furniture since It offers mainly low-end and midrange garden furniture, with 80 percent of production on outdoor pieces. Furniture accounts for more than 90 percent of output, with models shipped mostly to Europe and the US. In 2007, more than $1.2 million worth of furniture were exported. Aside from furniture, the company makes home furnishings such as lamps, chandeliers, flowerpot stands and outdoor parasols. Products are made mainly of teak. However, bamboo and rattan are also applied. Wood is sourced from government plantations, which guarantee that timber was legally harvested. Quotes range from $8 to more than $200. Pricing depends on size and complexity of design. A 500mm-high table made from teak is available for around $10, while a folding table that can fit six chairs is priced at an average of $85. The company also makes rattan tables with glass tops, as well as extension tables. Among its best-selling items are folding chairs and garden benches that are priced between $20 and $80. Manufacturing is carried out at the 6,000sqm factory in Jepara in Central Java. There are 500 fulltime employees and 250 part-time workers. Majority of production is done in-house, including cutting, baking, planing, assembly and finishing. Members of the QC team conduct inspections on each piece s color and finish before packing and shipping. Additional QC requirements are available request. Corrugated paper or single face paper are used as packaging, although other materials, such as foam, are available at cost to buyers. Meanwhile, delivery time for TEU and FEU orders are five to Contact details Business contact HASIM Mohammad Phone (62-291) Fax (62-291) sales@arjunajati.com arjuna_jati@hotmail.com URL Address Bulungan RT01/V, Jepara, Central Java, Indonesia six weeks and six to eight weeks, respectively, after receipt of 50 percent down payment. Arjuna Jati anticipates its export sales to increase by 10 to 20 percent in the next 12 months. It will be targeting the EU market during that period. To attract orders, the company plans to participate in more trade shows and exhibits. Profile Company facts Year established 1992 Head office location Jepara (Central Java) Ownership Locally owned Factory location(s) Jepara (Central Java) Full-time employees 500 Part-time employees 250 Total annual sales (all products) $1,500,000 Capability Materials used Acacia Bamboo Natural fiber (banana, water hyacinth, etc.) Rattan (real/synthetic) Teak Other natural materials No Yes No Yes Yes No Sales & output: Indoor & outdoor furniture Annual sales $1,400,000 Share of total sales 93% Annual export sales $1,250,000 Total monthly capacity 10,000 pieces Average monthly output 6,000 pieces Capacity utilized 60% Average monthly exports 5,400 pieces Export ratio 90% Exports by product Indoor furniture 20% Outdoor furniture 80% Exports by market North America 10% European Union 60% Eastern Europe 10% Middle East/Africa 10% Asia 5% Other 5% 22 Indonesia Sourcing Report

7 SUPPLIER PROFILES Popular export models Image file name: ID No. 312 Image file name: ID No Image file name: ID No Model: AJT 3010 Minimum order: 10 pieces Packaging type: Single face wrapper or box Delivery time: 14 days Indicated price: $20 Description: Folding table; round; sun design; 60x75cm Model: AJT 357 Minimum order: One piece Packaging type: Single face wrapper or box Delivery time: 14 days Indicated price: $85 Description: Folding table; oblong; sun design; can fit six chairs under table; 150x100x75cm Model: AJTB 309 Minimum order: One piece Packaging type: Single face wrapper or box Delivery time: 14 days Indicated price: $160 Description: Bench and table; can seat up to six people; 140x95x140 Image file name: ID No C Model: AJ-BA011 Minimum order: 10 pieces Packaging type: Single face wrapper or box Delivery time: 14 days Description: Banana-shaped bench; teak; 86x152x60cm Information not disclosed 23

8 PRODUCT GALLERY PRODUCT GALLERY Indoor furniture Image file name: 2602.jpg Image file name: 2604.jpg Image file name: 2605.jpg Model: BB 0003 Minimum order: One piece Description: Dresser; bamboo; 100x50x90cm; available in different styles, colors and measurements Model: BB 0017 Minimum order: One piece Description: Night table; bamboo; 45x45x45cm; available in different styles, colors and measurements Model: BB 0029 Minimum order: 12 pieces Description: Wardrobe cabinet; bamboo; 120x60x190cm; available in different styles, colors and sizes Image file name: 2606.jpg Image file name: 8018.jpg Image file name: 1818.jpg Model: BB 0041 Minimum order: One set Description: Four-piece sofa set with table; bamboo; available in different styles and colors Model: BB 0200 Minimum order: 12 pieces Description: Bed; bamboo; 90x200cm; available in different colors and sizes Model: BB 0300 Minimum order: 12 pieces Description: Bed; bamboo; 140x200cm; available in different colors and sizes Information not disclosed 61

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