How to break the bottleneck in the furniture industry
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July 18 12:10:23, 2025
From an international perspective, the U.S. continues to impose anti-dumping duties on Chinese wooden furniture, with tax rates ranging from 43.23% to 216.01%. Although the implementation of these taxes is deferred for five years, the overall export outlook remains bleak. Domestically, the furniture market faces challenges due to a prolonged economic slowdown and strict real estate regulations, leading to a sluggish consumer demand. In addition, inflation has caused widespread price increases, pushing up production costs for furniture manufacturers. This combination of factors has made the industry’s situation increasingly difficult.
Over the past few years, export growth has stagnated, prompting many Chengdu-based furniture brands to shift their focus toward the domestic market. As the economy slows down, consumption in first-tier cities has been significantly curbed, forcing companies to target second- and third-tier cities instead. While this move has created new opportunities, it has also led to intense competition in these regions. Many enterprises are rushing into the market, but the demand in these areas is not always sufficient to support such rapid expansion. Despite the challenges, this trend seems irreversible. Industry experts believe that the furniture retail expansion will remain a defining feature of the industry for the foreseeable future. While it may be tough, this process of natural selection ultimately benefits the sector in the long run, driving innovation and sustainable growth.
In today's highly competitive market where product homogeneity is common, furniture companies must clearly define their brand positioning. Whether targeting the high-end, mid-range, or budget segment, having a clear direction is essential for long-term success. Without a defined strategy, companies risk being lost in a crowded market. A strong brand identity and unique product offerings are key to standing out and gaining a loyal customer base.
As the saying goes, “water flows downward, people go upward.†Many furniture companies are now aiming to move up-market, hoping to capture a share in the high-end segment. However, this transition is not without risks. While some have succeeded, many have struggled. Jumping too fast without the necessary quality and brand recognition can lead to failure. If a company wants to enter the high-end market, it must ensure its products meet the standards expected by discerning customers.
Additionally, some firms have tried to boost their image by entering high-end furniture stores, believing this would elevate their brand value. However, in an era of shrinking profit margins, this may not be the most effective strategy. For example, Red Star Macalline opened over 40 new stores in 2010 alone, surpassing the total number of stores opened in previous years. At first glance, this seemed like a sign of booming growth. In reality, the rapid expansion led to increased vacancy rates and rising rental costs. What used to be a 200-square-meter space costing 20,000 per month now requires 300 square meters at 40,000 per month, with profits remaining stagnant or even declining. As a result, many dealers find themselves working harder than ever, yet seeing little improvement in their bottom line.