Thai furniture and parts export’s situation
Thai furniture and parts exports’ growth rate in the first half year of 2011 is likely to slow down from last year from 17.4% to 3-5 %, accounted for $ 1,140-1,160 billion. Since Thai’s major market, USA and Europe still have faced the economic crisis, the investments have been slowed and ceased. Moreover, USA tends to invest and expand furniture manufacture in Mexico for domestic consumption instead of direct imports. Because Mexico has low labor wage and is near USA, It will reduce transportation cost when compared to exporting furniture from Thailand.
New market for Thai furniture and parts industry
Japan and India markets will replace USA as new opportunity to increase furniture exports rate for the second half year. Especially, India has imported Thai furniture for 14% due to its high economic growth rate. India has expanded its construction business, tour business, shopping stores, and other sectors. Since Indian furniture manufacturers cannot meet customers’ needs in fashionable and modern design in products, India seems to imported Thai furniture in a high amount. Thai furniture is accepted in India due to its fashionable and modern design and ability to meet customers’ needs.
Both giant and small Thai entrepreneurs who want to break in to furniture and parts market in India should display his/her products in exhibition in both Thailand and India. This method will introduce your products to India consumers without making publicity or advertising which costs pretty much. There is diversity in attendants, major importers, department stores, franchise shops, and other groups. Your company will be able to hit all target groups, from low to high-end target group and also be able to expand market in India rapidly in the shorter period.
All Thai entrepreneurs should monitor for government’s labor minimum wage policy that may boost the cost of production higher. Also, pricing for furniture and parts may rise too. It could affect the ability to compete with other competitors of Thai furniture exporters in India market. Because price is a major factor that Indian customers consider for buying products.
Reference Kasikorn Research Center, August 2011