The rise of Polish furniture: Will it catch up with Germany and become the world's second largest furniture producer?

Text/Compiled by Thomas Russell/Gao Dandan

In the past few years, Poland has become an increasingly important source of supply for the US civilian furniture market. In 2019, the total value of Polish furniture exported to the U.S. market was approximately US$265 million (the figure for mainland China was US$9.713 billion). Although it dropped 13% from US$304 million in 2018, it still ranks among the top 10 sources of furniture imports in the United States. One of the countries/regions, ranking 9th after India and before Taiwan, China. (For details, see "U.S. Furniture Imports and Exports in 2019: Imports fell by 8%, but Vietnam increased by 35%!")

Among the furniture categories exported from Poland to the United States, miscellaneous wood furniture, wooden bedroom furniture and wooden furniture Bed-making is the three categories with the largest export volume, followed by wooden frame upholstered seats and metal frame upholstered seats. The other five categories with the highest export volume are: wooden frame upholstered seats, wooden dining tables, wooden kitchen furniture, non-upholstered metal seats and non-upholstered wooden seats. (See Table 2)

Poland’s advantage as a furniture exporter is closely related to its long-term supply to IKEA. In order to better produce RTA (Ready-To-Assemble) quick-assembly furniture, the factory invested millions of dollars in purchasing it. Advanced equipment enables highly automated production to meet the standards required by IKEA.

1 Seeking direct-to-retailer channels

In order to no longer be limited to large furniture suppliers (such as IKEA), Polish furniture manufacturers are seeking breakthroughs in other markets, such as at the same time For retailers who wish to purchase direct. In fact, 2020 will be a huge challenge for furniture manufacturers around the world, and Poland is no exception.

"Mid-March this year was almost an earthquake for Polish furniture manufacturers, and all usual transactions were suspended almost overnight. The most difficult thing is that this situation affected all of them at the same time. Export market countries, but also the local Polish market,” said Michal Strzelecki, director of the Polish Chamber of Furniture Manufacturers.

According to statistics, the slowdown in exports and domestic markets has led to a sharp 35% drop in sales across the Polish furniture industry compared with last year, while Michal Brown, founder and managing partner of TATFA (Trans Atlantic Trad For ALL) Michal Blonski, head of the Polish furniture industry, said that in March and early April, the production of the entire Polish furniture industry dropped by as much as 50% to 75%. However, as orders gradually recovered after May, June has basically reached the level of the same period in 2019.

2 Important players in the global furniture production landscape

Poland’s furniture manufacturing industry is booming. According to data from the Polish Furniture Manufacturers Chamber, the country’s furniture exports reached 13.6 billion euros in 2019. (This figure was approximately 6.4 billion euros in 2013) and will surpass Germany in the next two or three years to become the world's second largest furniture exporter after China. In fact, in 2014, Poland surpassed Germany and became the second largest exporter of wooden furniture in Europe. (See "Germany relies on imports, Italy is fragmented, understand the European furniture market in one article!"

In 2016, Poland ranked fourth among global furniture exporters, and China, which ranked first, accounted for about 10% of the global furniture export market. 37%. The second and third places are occupied by Germany (7.2%) and Italy (5.6%). According to data from the Italian Wood and Furniture Industry Federation, the export volume of the Italian wood and furniture industry in 2017 was 16.3 billion. Euro, employing approximately 320,000 people. Today's Polish furniture manufacturers are not only satisfied with the EU markets such as the United States, Canada, India, and the Middle East, but are also eager to export their products to more countries and regions.

Although in 2020. The annual furniture export volume dropped by about 25%, but Poland still plays an important role in global furniture production. Michal Blonski, founder and managing partner of TATFA, said that through rapid development in recent years, Poland’s Furniture products have been able to meet the design and other requirements of specific markets, mainly due to investment in production equipment.

"In the past three years, many customers from the United States have visited the production base and compared it with factories in Asia. Without exception, they were impressed by the highly automated, clean and well-organized production site. Profound." Tomasz Wiktorski, a consultant to the Polish Chamber of Furniture Manufacturers, provided a set of data: According to estimates, Poland has 80 large furniture manufacturers with an average of 249 employees; there are 310 medium-sized ones Furniture manufacturers have an average of 50 to 249 employees; 1,400 small businesses have an average of 10 to 49 employees.

The total number of employees in the industry is approximately 160,000. In addition, there are 26,000 microenterprises in Poland, employing approximately 200,000 people. These micro-enterprises are mainly supply chain enterprises such as timber suppliers. Among them, 80% of manufacturers mainly produce civilian furniture, and the other 20% mainly produce hotel, restaurant and cafe furniture (i.e. HoReCa furniture).

3 The efforts of Benix and Gala

Benix, a famous Polish upholstered furniture manufacturer, was founded in 1993 and has been supplying the US market for the past five years. Despite a certain drop in production, the company was able to maintain stable production under high pressure.

"Currently, we are already in full production capacity, and the order volume is higher than in the initial stage of 2020." said Nicole Mazur, marketing director of Benix. "Currently, 1% to 2% of the company's output is exported to the U.S. market, so there is still a lot of room for growth. At present, the company is mainly focusing on establishing cooperative relationships with American furniture chain stores. We focus on both physical retail and e-commerce retail. ”

Gala is another Polish furniture company with a history of more than 20 years. Its products are currently exported to more than 30 countries around the world. The company began exporting to the US market in 2018. The special circumstances in 2020 did not cause the company's production to completely stop, and ensured the continued operation of the four factories. "We are not only responsible for our four companies, but also for all our supplier partners. Our export business to many countries around the world allows us to have orders ready at any time."

Gala Company Soft Decoration Furniture products

Since this spring, as many retail stores have reopened, the company's business has increased by 30%. In order to continue its positive growth in the US market, the company is preparing to participate in the High Point Show this fall, although this may be affected by travel restrictions.

4 Actively seek to participate in the US market

Founded in the 1980s, BRW (Black Red White), a family-owned company in eastern Poland that started out as a carpenter, now products include upholstered furniture, beds Pads, cloakrooms, living room furniture and kitchen furniture, etc. The company has 19 factories and employs nearly 9,000 people. The company currently exports to 57 countries around the world, and began exporting to the U.S. market in 2010. Like many other businesses, the company was closed for two weeks due to government mandates. But since May, the company has quickly resumed production and reached full capacity.

BRW Company’s production workshop

Kamil Kaczmarek, the company’s director of export business, said, “Orders in June, July and August have exceeded last year’s At the same level. It is our strategic goal to establish cooperative relationships with large American companies, and we hope to demonstrate our capacity, flexibility and rapid production capabilities to customers, provide self-designed products, or develop new series of products in response to customer needs. ” < /p>

Szynaka Meble, another Polish furniture company founded in 1957, currently has 8 factories and mainly produces adult and youth bedroom furniture, leisure and soft furniture, and office furniture. The company has exported to the US market for For 10 years. At the beginning of 2020, the company maintained minimum production capacity and mainly sold inventory products. At present, with the rapid growth of business demand, the company is ramping up its efforts to start work. At the upcoming High Point Furniture Show, the company will showcase its latest and best-selling product lines to expand its presence in the United States.

Szynaka Company’s production workshop

In any case, many Polish furniture manufacturers are showing active attention and participation in the US market. Its advantage lies first in its foundation in the furniture manufacturing industry for many years, and secondly in its long-term experience in Europe and its market. For Poland, whether it can achieve the export volume of US$13.6 billion in the same period last year in 2020 remains a challenge. Industry insiders said that if everything runs well, growth of 4% to 6% may be achieved in 2020.