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Boom in furniture business

August 17, 2015


OVER the last three or so decades, Gujrat has emerged as one of the major suppliers of wooden home furniture in the country.

While some of the wealthier furniture manufacturers from the city have expanded their business to different cities and set up display centres in Lahore and Islamabad, etc, several others are producing furniture for local brands with showrooms across the country.

“Furniture sales are rising on the back of a spike in consumer spending,” said Ansar Mahmood Ghumman, CEO of Trendline Furnishers.

Furniture industry in Gujrat has grown bigger on the back of domestic sales. And a majority of furniture makers has yet to venture into the global market

“The economic slowdown or security concerns have failed to impact furniture sales. The rise in remittances by overseas Pakistani workers in recent years and the construction boom has helped give the furniture industry in Gujrat and elsewhere in the country a much needed boost,” he told this writer during a recent visit to the city.

Gujrat’s wooden furniture industry is divided into cottage and small- to medium-scale industry. Out of the almost 250-300 units engaged in the production of furniture in the city, less than a score can be categorised as medium-sized producers. Since a majority of the units remain unregistered, it is hard to estimate the exact size of their annual sales. But Ghumman said the total sales could easily be around Rs7bn a year.

A vast majority of the city’s furniture factories do not have modern machinery or access to capital to modernise and expand. But obsolete machinery or small-scale production facilities are not the only problem facing the manufacturers. Factory-owners complain of fast depleting forests, the only source of shisham or Indian rosewood (a type of hardwood used to make furniture).

The furniture industry in Gujrat had emerged almost 100 years ago, said Mirza Mohammad Fayyaz, the chief executive of Decent Furniture.

“The city with two large rivers — Jhelum and Chenab — and big reserves of shisham jungles on its two sides was a perfect place to produce furniture. Moreover, wood logs from Kashmir, transported through Jhelum, were also easily available,” he added.

However, the illegal cutting of timber over time — without any new plantations to replace the trees — has led to an acute shortage of local hardwood for the city’s furniture makers. Besides, the illiterate and unskilled labour is also stunting the industry’s growth.

“We have this special gift of wasting our natural resources, be it gas, water or forests,” a frustrated Fayyaz contended.

Initially, Gujrat’s furniture makers produced for the government and the military during the pre-independence years. And growth was very slow in the first few post-independence decades.

“It was during the 1980s that the city’s furniture production picked up momentum,” Ghumman said.

“It was the time when a large number of Pakistanis were exposed to luxury living in the Gulf where they went for work. And they also had disposable income in their pockets to spend on furniture. This led to design invitation and the establishment of large display centres in major cities. Ever since, the industry has flourished despite the rising cost of production due to the use of expensive, imported hardwood and alternative raw materials,” noted Fayyaz.

The furniture industry in Gujrat — just as elsewhere in the country — has grown bigger on the back of domestic sales. And a majority of furniture makers has yet to venture into the global market.

Therefore, Pakistan’s share in the estimated world furniture trade of $25-30bn remains negligible.

Most furniture producers like Decent Furnitures, which started exporting as early as the late 1960s and dared to open display centres in the UK and elsewhere, were forced to shut down their overseas outlets because of their high cost of doing business. The expensive imported raw materials and energy costs did not allow them to compete with much cheaper imports from China and India.

Chinese furniture, it seems, is also becoming popular in the domestic market because of its low prices, displacing products from competitors like Thailand and other furniture-exporting nations.

“Our industry has no contact with any global brand or store, which is essential to boost exports,” Fayyaz added. The ‘foreign clientele’ of Pakistani furniture mostly comprise overseas Pakistanis living in the United States, Canada, United Kingdom and the Middle East, he concluded.

Ghumman nevertheless says some Pakistani furniture makers still have their sales outlets in places like Dubai and are doing well enough. “We have enormous potential for wooden furniture exports, but we require the government’s support in both acquiring cheaper raw materials and access to markets.”

“Our commercial attaches posted in foreign capitals must be trained to help their exporters and increase their business. Also, the Trade Development Authority of Pakistan should arrange roadshows to introduce our traditional, carved furniture to consumers abroad,” he stressed.

He believed that in order to increase the country’s furniture exports, the manufacturers need to be given tax and credit incentives to acquire new technologies and to grow big enough to sustain competition from their rivals in the international market.

Published in Dawn, Economic & Business, August 17th, 2015

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