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Furniture makers adapt to new trends

Booming local market and demand for uniqueness softens blow of lost OEM contracts to China

By Sujintana Hemtasilpa

With growth in Thailand's property market projected at 20% next year, major players in the furniture and interior decorating businesses see prosperity in their future, despite moves by international furniture brands to shift their original equipment manufactures (OEM) orders to China.

Banking on the current property boom in Bangkok and other major cities, Bangkok Interfurn Group, a furniture manufacturer and operator of the Index retail chain, expects total sales this year to hit five billion baht, a substantial gain over last year's sales, which were 4.5 billion baht.

Pisith Patamasatayasonthi, the group's president and chief executive officer, said half of the company's sales went to the domestic market and with the rest exported.

Modernform Group Plc, a leading manufacturer of knocked-down furniture, has projected that its revenue will grow by 18% to 3.3 billion baht next year from 2.8 billion this year.

Major retailer Robinson Department Stores Plc has also announced a plan to expand its furniture, home products and decoration section, citing the expectation that Thai people are likely to spend more of their leisure time at home due to skyrocketing fuel prices.

Consequently, Robinson expects consumers to spend more on products that could make their time at home more pleasant, according to Preecha Ekkunagul, the company's president.

Thailand's furniture and home decoration market is estimated to be worth more than 250 billion baht, with around 9,000 players. More than half of all locally produced furniture and home decorative items are exported.

Growing alongside the furniture market is a trend toward hiring professional interior designers.

Thinakorn Rujinarong, president of the Thailand Interior Designers Association, said the interior design market was worth several billion baht a year and was growing by about 20% a year.

However, due to the fact that many international brand owners have begun shifting their OEM orders to countries offering a labour cost advantage over Thailand, several manufacturers have been left with no choice but to attack the local market more aggressively and build up their own brands.

Increased competition among local manufacturers seeking to tap a greater share of the the domestic market can be seen in the recent establishment of Ekko, a weekend furniture bazaar on Bangkok's Ekamai Road.

Somlak Hutanuwatr, assistant to the president of Furniture Market Place, the operator of Ekko, said several tenants at the company's weekend bazaar were furniture manufacturers seeking to sell off stock that exceeded production orders or was rejected. Ekko makes an alternate distribution channel available to them, she said.

However, according to the Department of Export Promotion, only a few manufacturers in Thailand have begun designing their own products. But without distinctive or original designs, they predict that it will be difficult for local manufacturers to make their house brands succeed.

Officials say it will take time for local manufacturers to transform themselves from OEM contractors into original designers, and eventually original brand manufacturers.

As a furniture-exporting country, Thailand's designs have traditionally been dominated by world design trends set by international giants, said Apirom Kongkanan, an industrial designer and lecturer at King Mongkut's University of Technology Thon Buri.

To help Thai manufacturers keep ahead of future global design trends, the Department of Export Promotion has hired as consultants a number of global firms, including Carlin International and Nelly Rodi from France.

In a more developed market, such as Italy, design trends are used as guidelines to help all businesses in the furniture supply chain adjust their operations in the same direction, by stocking the most up-to-date materials in an efficient and coherent manner. In this way, the whole industry is able to grow at the same pace," said Ms Apirom.

Since interior design trends are tied in closely with what's hot in furniture, a similar move locally would allow designers to find what they need on the local market, which would in turn spark more interest in made-in-Thailand products.

According to the DEP, Carlin has predicted that next year's furniture designs will emphasise relaxation and wellness, both physically and spiritually.

Designs for the spring and summer of 2005 are likely to fall under the themes of Quintessence, Jubilation, Presence and Symbiosis, the DEP said, citing Carlin's work.

Quintessence designs will touch on emotions and feelings using "raw-look" materials, such as unfinished wood, stones and millboard. Underpinning the theme is the increasingly stressful environment in major cities which has prompted many to perceive their home as a "personal cocoon".

Jubilation, the report said, evokes a playful style of decoration that conjures up happy feelings of childhood and intimacy. It is intended to serve the need to be carefree and freely express oneself. Furniture will be more customised, it added, which will allow customers to make their own adjustments, by drawing on the fabric cover, for example.

Designs in the Presence theme, meanwhile, are aimed at creating a more elegant and refined world to serve the individual's need to perfect his or her image.

Designs of this theme are likely to be influenced by the Art Deco style from the 1930s. Furniture will cater to the desire for comfort, with sofas in a fashion similar to deck chairs and club armchairs in rattan.

Symbiosis designs will be based on nature, inspired by its tendency to alarm. Furniture will therefore imitate nature, with shapes and colours following natural themes reinterpreted in unique designs and decorative ideas. Sofas, for example, will be more organic and appear in rounded shapes. Armchairs could convey the influence of ethnic styles with colourful woven stripes.


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