Furniture exports down on lack of research
For family-owned furniture producer CV Yudhistira, understanding market demand has proven to be a recipe for getting more orders.
After conducting thorough research on global demand, the firm now exports 25 to 30 containers of wooden chairs and tables every month, a jump from the roughly 20 containers it sent out monthly in 2015.
“Communication with clients on what the market likes is the key to getting more orders. Visiting expos in Italy and France is also important, as the European market is the world’s trendsetter in the furniture industry,” said the firm’s general manager, Yohatam “Gatot” Suparto.
Yudhistira is among a small number of firms that understand the power of market research, as the government has blamed a lack of such knowledge for contributing to the decline in furniture exports.
Indonesian Furniture Entrepreneurs Association (Asmindo) chairman Mugiyanto acknowledged that a lack of market knowledge had contributed to declining exports. For this year, the association has set a target of US$1.9 billion worth of furniture and craft exports, but it has only achieved 40 percent of that figure as of June.
Furniture and craft exports declined to $1.6 billion last year, down 15.7 percent from $1.9 billion recorded in 2015.
As the government is aware of the problem, the Creative Economy Agency (Bekraf) has stepped in to help.
The agency has launched a program called KOPIKKON to train furniture makers in understanding market demand and staying up-to-date on international trends in furniture design.
Aside from that, the agency also helped producers market their products in creative ways, Bekraf deputy head of research, education and development Boy Berawi said recently.
This year, the program focuses on training furniture makers in Banyuwangi and Bojonegoro in East Java; Banjarmasin in South Kalimantan; Belu in East Nusa Tenggara (NTT) and North Toraja in South Sulawesi.
The agency also recently launched a workshop linking furniture producers and artists with big furniture traders and producers, so that the former can be informed about current tastes, ranging from furniture design to the sizes preferred in various countries.
Besides a lack of market insight, the decline in exports is also blamed on the government requirement that companies be certified under the Indonesian timber legality assurance system (SVLK) for exports to Europe, Indonesia’s largest furniture market.
“Furniture producers have also been confronted with high interest rates on loans, making it hard for them to buy machinery for mass production,” said Society of Interior Designers (HDII) chairman Lea Aviliani Aziz.
Producers have also complained about a decision by stateowned forestry company Perhutani to increase its wood price by 10 percent per year, thereby burdening the local industry with higher production costs.