furniture market in the czech republic - ditp
TRANSCRIPT
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I M P O RT S O F F U R N I T U R E T O
T H E C Z E C H R E P U B L I C A N D
P O T E N T I A L F O R T H A I L A N D
MARKET STUDY
PREPARED BY:
OFFICE OF COMMERCIAL AFFAIRS
ROYAL THAI EMBASSY
HOLEČKOVA 29
150 95 PRAHA 5
CZECH REPUBLIC
SEPTEMBER 2016
1
INTRODUCTION - SUBJECT OF THE MARKET STUDY
This market study is focused on position of the Czech Republic in furniture
trade, analysis of imports including information on customs tariffs, trade fairs
and opportunities for Thailand. Source of information were data from the Czech
Statistical Office, Ministry of Industry and Trade, Ministry of Finance and
researches carried by specialized agencies.
CONTENTS OF THE MARKET STUDY
CHAPTER SUBJECT
PAGE
INTRODUCTION - SUBJECT OF MARKET STUDY 1
1 POSITION OF THE CZECH REPUBLIC IN THE FURNITURE TRADE 2
2
2.1
2.2
2.3
2.4
SITUATION ON THE LOCAL MARKET
LOCAL PRODUCTION OF FURNITURE
FUTURE DEVELOPMENT OF INDUSTRY
TOP CZECH PRODUCERS
MEDICAL FURNITURE
3
4
4
7
3 ANALYSIS OF FURNITURE IMPORTS 10
4
4.1
4.2
MARKETING INFORMATION
TARGET CONSUMERS
CONSUMER BEHAVIOUR
11
11
12
5 CZECH RETAIL MARKET 14
6 CUSTOMS TARIFFS 16
7 TRADE FAIRS 17
8 CZECH FUTNITURE ASSOCIATION 19
9 SUMMARY 20
10 OPPORTUNITIES FOR THAILAND 21
2
IMPORTS OF FURNITURE TO THE CZECH REPUBLIC
AND POTENTIAL FOR THAILAND
1. POSITION OF THE CZECH REPUBLIC IN FURNITURE
TRADE
CZ is net exporter of furniture for homes and offices made of wood, metal
or plastics (HS 9403).
DEVELOPMENT OF IMPORTS AND EXPORTS OF FURNITURE
FOR HOMES AND OFFICES HS 9403
TO/FROM THE CZECH REPUBLIC
TOTAL VALUE
OF:
2008 2009 2010 2012 2013 2014 2015 Jan-July/
2015
Jan- July/
2016
Imports to CZ
(in mil. USD)
596,9 428,3 384,6 424,0 429,7 456,4 459,4 251,2 285,6
Exports from CZ
(in mil. USD)
767,9 549,4 563,1 600,7 658,0 737,9 732,8 413,5 474,1
Source: The Czech Statistical Office, September 2016
The table above shows development of exports and imports of furniture since
the year 2008. We can see, that both imports and exports are rising. Since the
year 2012, furniture exports from the Czech Republic are rising faster than
Czech imports of furniture. During January – July, 2016 exports of furniture
grew by 14,7 % while imports recorded growth of 13,7 %.
When we analyze the whole period since the year 2008, we can see, that positive
development was interrupted in the year 2009 by economic crisis. After few
years of slump, the situation stabilized in 2012, however value of exports and
imports have not reached the pre-crisis level yet.
Based on the above table we can conclude, that the Czech Republic mantains
position of a net exporter of furniture.
Czech Republic exports furniture mostly to EU countries, but also to U.S.A. and
Switzerland.
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2. SITUATION ON THE LOCAL MARKET
2.1 LOCAL PRODUCTION OF FURNITURE
The manufacture of furniture has had a long tradition, especially in Moravia.
Popular in Europe as well as worldwide is bent furniture, medical futniture
(hospital beds) and also kitchen furniture. Interesting solitary furniture has been
recently produced by many Czech smaller manufacturers (for halls, living rooms
etc.), which represents an assortment that used to be weakness of Czech
production.
The manufacture of furniture in the Czech Republic is at present concentrated in
small and medium sized enterprises. Furniture is manufactured in all regions of
the Czech Republic – but mainly in South Moravia and Zlín (due to a long
tradition). South Moravia accounts for more than 20 % of total furniture
production in the Czech Republic, the region of Zlín for more than 17 %. The
third place belongs to the region of South Bohemia, followed by Vysocina
Region and Central Bohemia.
Competition advantage of the Czech Republic is the domestic origin of raw
materials and at the same time raw material being a renewable source. Raw
materials are supplied to the furniture industry by the Czech woodworking
sector with the exception of tropical wood and selected variety of materials
which are imported incl. paints, varnishes, metal accessories, but their share on
total supplies is of no great importance.
The branch still faces many problems which will have to be tackled in the
coming period. This applies to the improvement of technologies and
production and their consolidation into larger entities, the improvement of
management and increase in profitability.
Concerning number of employed persons, the declining trend started in the year
2008 (economic crisis), between the year 2008 and 2014, the decrease in number
of workers in furniture industry reached -23 %.
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2.2 FUTURE DEVELOPMENT OF CZECH FURNITURE
INDUSTRY
The branch currently should focus on the modernization of factories and their
effective concentration, and improvement of organization and management.
Big advantage of Czech furniture industry is sufficient sources of the domestic
raw material – wooden mass, nevertheless, the investment activities have been
still low and insufficient. Significant problems with investing are especially in
small enterprises.
However, furniture industry as the whole have favourable prospectives to the
future, not only to maintain existing positions but also to strengthen and enlarge
them. Further expected advancement of the Czech economy will be to a great
extent a decisive driving force accordingly, which should be accompanied by
growth of standard of living as well. It should be witnessed in such a way, that
people in the Czech Republic will replace earlier especially living room and
bedroom furtniture. The average time of utilization of these kinds of furniture
is almost 20 years in CZ, whereas in advanced countries of the EU it is 10
years on average, and then the futniture is replaced by new one.
2.3 TOP CZECH FURNITURE PRODUCERS
Among biggest furniture producers in the Czech Republic are following
companies: TON, JITONA, KORYNA, and SYKORA.
TON, a.s. BYSTRICE POD HOSTYNEM
www.ton.eu
- domestic leader in bentwood furniture, chairs and armchairs
- one of biggest producers of chairs in the world
- chairs account for 95 % of production
- annual production of chairs reaches 1,5 million pcs
- 30 % of production goes to domestic market, rest abroad (to 40 countries)
- turnover in 2014: USD 50 million
- number of employees: 810
- operates network of own retail stores in CZ (13 stores)
5
JITONA, a.s. SOBĚSLAV
www.jitona.cz
- one of biggest producers of wooden furniture in CZ
- established in 1954, when state enterprise with 23 production plants was
created
- in 1991 was transformed into joint stock company
- operates 3 production plants in CZ
- number of employees: 840
- turnover in 2015: 60 mil. USD
- JITONA operates newtork of own retail stores and showrooms (7)
- JITONA uses 2 brands on Czech market: JITONA DESIGN
COLLECTION and JITONA CLASSIC COLLECTION
- more than 95 % of production is exported
- big customer is IKEA
- JITONA CLASSIC COLLECTOIN JITONA DESIGN COLLECTION
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KORYNA NABYTEK, a.s. KORYCANY
www.koryna.cz
- one of the biggest producer of kitchens
- in kitchens controls more than one third of domestic market
- 60 % of production is meant for domestic market, rest for export (mainly
to Slovakia, Russia, Bulgaria, Baltic States)
- number of employees: 100
- turnover in 2014: USD 25 million
SYKORA, s.r.o. VIZOVICE U ZLINA
www.sykora.eu www.sykora-kuchyne.eu
- one of biggest producers of kitchen units made to order (fitted kitchens)
- established in 1992
- new production plant was built in 2001 – top level of machines,
technology, computer equipment, production is fully automated
- number of employees: 120
- turnover in 2014: USD 15 million
- exports account for more than 40 % of total production
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2.4 MEDICAL FURNITURE
The Czech Republic is net exporter of medical furniture (HS 9402). Exports
from the Czech Republic in the year 2015 reached 141 mil. USD, while imports
to CZ 13 mil. USD. Main export destinations are E.U. countries, U.S.A., Saudi
Arabia, United Arab Emirates, Switzerland.
Market leader in medical furniture is Czech company LINET (www.linet.cz) .
Czech company LINET CO., LTD., manufacturer of hospital and nursing beds,
became No. 1 in Europe in the year 2015. The turnover in the year 2015
recorded 25 % growth and reached the volume of EUR 218 mil. The fastest
growth in Europe was reached especially in Germany, Italy, Spain and Sweden.
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The company´s portfolio includes solutions designed for intensive care, products
for regular in-bed treatment and also special beds for senior citizen´s homes and
long-term care facilities. The LINET range also includes a wide range of
accessories such as anti-pressure ulcer mattresses, mobile equipment, healthcare
furniture, etc.
LINET headquarters, as well as its production plant, is based in Zelevcice near
Prague, where it has been located since its establishment in 1990. The plant
manufactured 50 000 hospital beds in 2015. In the year 2016, LINET is going to
open another factory in Zelevcice. 95 % of production goes for export to 100
countries of the world. Another factory of LINET is located in Germany, in
Wickede. The total number of employees of LINET is 1 350, in the Czech
Republic it is over 900.
Total number of beds manufactured by LINET in the year 2015 reached
90 000 (50 000 of hospital beds + 40 000 of special beds for senior citizen´s
homes).
KEY MARKETS FOR LINET CO.
COUNTRY TURNOVER
in 2015 (mil. EUR)
GROWTH
in 2015
the U.S.A. 45 67 %
Germany 44 26 %
Midddle East and Africa 16,6 32 %
The highest growth in 2015 was reached in the U.S.A., where the turnover
increased by two thirds, from EUR 27 mil. to EUR 45 mil. In the market
segment of intensive care beds, LINET became No. 3 player in U.S. market
reaching the share of 20 %.
The significant growth of 26 % was reached also in German market with the
revenues reaching EUR 44 mil. in 2015.
The third most important market for LINET are countries of Middle East and
Africa with turnover of EUR 16,6 mil. and growth of 32 % in 2015. In Saudi
Arabia, the U.A.E., Qatar and Bahrain, the most exclusive range of products are
in demand. The latest order from Middle East comes from HAMAD hospital
group in Quatar – delivery of 400 hospital beds incl. special beds for intensive
care unit for children. Main competitors of LINET in Middle East are U.S.
companies Hill Rom and Stryker and british Arjo Huntleigh.
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As for the plans of LINET in the year 2016, the company wants to focus on
Asia. In April, LINET will join the biggest medical fair in China, the CMEF
Shanghai. In China, LINET started to co-operate with Chinese pharmaceutical
company XIUZHENG.
Due to high quality, long time experience and reasonable prices, LINET could
be considered as supplier of hospital beds for Thailand. Currently, LINET is
considering to invest in Thailand (FDI).
Major competitors of LINET in Europe are FAMED of Poland and VOKER Co.
of Germany. In the U.S. market, it is HILL-ROM Co. and STRYKER Co.
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3. ANALYSIS OF IMPORTS OF FURNITURE
TO THE CZECH REPUBLIC
IMPORTS OF FURNITURE FOR HOMES AND OFFICES HS 9403
TO THE CZECH REPUBLIC
COUNTRY IMPORT VALUE
( thous.USD)
MARKET SHARE (%)
GROWTH
(%)
01-07/ 2015
01-07/ 2016 2014 2015
01-07/ 2016 2014 2015
01-07/
2016 2015
Poland 58,500 69,168 105,522 111,745 24.22 23.12 24.32 18.24 5.90
Germany 52,695 66,613 89,980 101,592 23.32 19.71 22.11 26.41 12.91
China 34,476 37,155 59,391 57,030 13.01 13.01 12.41 7.77 -3.98
Italy 17,618 16,499 35,640 28,521 5.78 7.81 6.21 -6.35 -
19.97
Slovakia 18,459 18,563 35,342 34,650 6.50 7.74 7.54 0.56 -1.96
Austria 14,064 15,083 24,182 26,010 5.28 5.30 5.66 7.25 7.56
Sweden 5,825 6,037 15,000 10,320 2.11 3.29 2.25 3.64 -31.20
Lithuania 6,287 8,396 14,743 12,886 2.94 3.23 2.80 33.55 -12.60
Thailand 475 815 796 942 0.29 0.17 0.21 71.58 18.34
Other countries 42,837 47,264 75,816 75,711 16.55 16.61 16.48 10.33 -0.14
TOTAL 251,236 285,593 456,412 459,407 100.00 100.00 100.00 13.68 0.66
Source: The Czech Statistical Office, 2016
Major suppliers of furniture to the Czech Republic are EU countries (advantage
of border-free trading). Market leader is Poland with stable market share of 24
%, followed by Germany (market share in 2015 reached 22 %). The third most
significant supplier of furniture to Czech market is China. Market share of China
in the year 2015 reached 12,4 %.
Market share of Thailand is less than 1 %, in the year 2015 furniture in the total
value of 942 thous. USD was imported to CZ from Thailand.
From Asian countries, China is leading supplier of furniture to Czech, its market
in the year 2015 reached 12,4 %. From China, mostly wooden indoor furniture,
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metal furniture and furniture parts of metal are imported. Market share of other
Asian countries, such as Malaysia, Indonesia, India, Vietnam and Thailand, on
Czech market is lower than 1 %. Imports from Vietnam in the year 2015 reached
3,9 mil. USD., main items are: furniture parts, metal furniture, wooden kitchen
furniture and rattan/wicker furniture Volume of imports of furniture from India
reached 2,8 mil. USD, main item is wooden furniture for living and dining
rooms. From Indonesia, volume of imports in 2015 was 1,7 mil. USD, teakwood
furniture for both indoor and outdoor, rattan and bamboo furniture was
imported. From Malaysia, mostly wooden furniture for homes is imported,value
in 2015 reached 0,8 mil. USD. From Thailand, major item is HS 9403 60
Wooden Furniture for Homes – made of exotic wood.
4. MARKETING INFORMATION
4.1 TARGET CONSUMERS
The decisive factor in purchasing furniture is the performance in entire Czech
economy. It relates mostly to increases in the scope of housing and industrial
constructions, larger reconstructions and to general increases in standards of
living. This would free up financial means, which could be used for purchase of
furniture.
As for the target groups for furniture in the Czech Republic, two categories can
be identified:
1. corporate sector (offices, schools, hospitals, hotels, restaurants etc.)
2. households
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4.2 CONSUMER BEHAVIOUR
Demand for furniture in the Czech Republic can be classified into two
categories:
1) low-priced furniture made from lower quality materials and
technologies and sold mainly in big shopping centres – group of
cheap furniture is not expanding. The number of customers who are
interested in new opportunities is decreasing, as they are
discovering that low-priced furniture does not correspond with the
idea of a quality interior furnishing
2) high quality furniture with attractive design, made from quality
materials using state-of-art technologies. New lifestyles are
changing the former habits for furnishing flats. Travel, exhibitions,
magazines and television contribute to the customers´ knowledge
and demands. General knowledge about materials is improving and
the demand for materials with certain properties not harmful to
one´s health is on the rise.
Furnishing new flat
When furnishing new flats, people make it step by step. Most frequently, they
start with a quality bed equipped with a quality frame and a compatible mattress.
The number of customers who realize how important a bed is for their health, is
increasing.
The kitchen, along with the bathroom, is at the forefront of interest not only in
new households, but also in the renovation of old flats. Companies KORYNA
NABYTEK (www.koryna.cz) and SYKORA Co. (www.kuchyne-sykora.cz) are
biggest producers and exporters of kitchen furniture and control more than 50 %
of domestic market in kitchens. In both cases, export accounts for more than 40
% of the total production. Competition between producers is constantly
increasing quality. The bodies of the kitchen units are made not only from
chipboard materials, but also from quality laminated wood. Materials used for
the doors and the fronts of the full pull-out drawers, which have replaced the
former, inaccessible internal shelves, are hard specially processed fibreboard,
three- and five-layer bioboard, perforated boards in frames, toughened glass in
frames etc. New designs are being sought for better utilization of space, and also
drawers and doors, that close silently. Stone, CORIAN, and other current
materials are used for the top boards, the work surfaces are lit by built-in cool
safe lights.
13
Metal is making a re-appearance in flats again (the comfortable living of the
1920s is returning in new materials) on appliances, handles, edges and legs of
kitchens, on the legs of upholstered furniture, on the visible parts of armchair
structures.
Based on the latest research of INCOMA GfK market research agency, the
breakdown of the different cathegories of furniture purchased most frequently
by Czech customers in the year 2015 was as follows:
Source: INCOMA GfK, 2016
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As for furniture accessories, the cathegory most in demand in the year 2015 was
bedclothes purchased by 70 % of customers, tableware (purchased by 65 % of
customers) and lamps + lighting (purchased by 64 % of customers).
In the year 2015, the average spendings for furniture was CZK 14 850,- per year
and CZK 4 200 per home accessories. Furniture is most frequently purchased by
age cathegories below 39 years of age.
5. CZECH RETAIL MARKET
According to latest research of INCOMA GfK market research agency, more
than two thirds of Czech customers prefer buying furniture in large
specialized stores. Key players on the Czech market are 7 large international
chains stores selling furniture and home accessories.
INTERNATIONAL CHAINS SELLING FURNITURE IN THE CZECH REPUBLIC
COMPANY TURNOVER
in 2014 (bil. CZK)
NUMBER
OF STORES
IKEA 7,22 4
KIKA 1,83 8
JYSK 1,69 79
XLMX Co.
(XXXLutz and MOBELIX stores)
1,67
2 XXXLutz
9 MOBELIX
SCONTO 1,59 8
ASKO 1,34 13
Source: INCOMA GfK
15
Market leader in terms of turnover is IKEA, leader in number of branches is
JYSK, that operates 79 stores in the Czech Republic. JYSK is famous especially
for home accessories and decoratons.
Some of big Czech furniture producers have networks of their own retail stores
and showrooms, such as companies TON or JITONA.
Big international companies import furniture directly through their purchasing
departments (centralized for whole Europe)
Among importers of furniture and accessories from Thailand (mainly teak, water
hyacinth etc.) is for example DONATE Co. (www.donate.cz) or HD NABYTEK
(www.hd-nabytek.cz). Thai furniture and accessories can be also purchased in
IKEA (IKEA is buying furniture through centralized purchasing department).
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6. CUSTOMS TARIFFS
There are no trade barriers concerning imports and exports of furniture and
parts.
CUSTOMS TARIFFS
H.S. Description EU rate
9403 10 Office furniture of metal 0,0 %
9403 20 Other metal furniture 0,0 %
9403 30 Wooden office furniture, 0,0 %
9403 40 Wooden kitchen furniture 2,7 %
9403 50 Wooden bedroom furniture 0,0 %
9403 6010 Wooden furniture for living
and dining rooms
0,0 %
9403 70 Furniture of plastics 0,0 %
9403 81 Furniture of other materials
(rattan, bamboo, etc.)
5,6 %
9403 9010 Furniture parts of metal 2,7 %
9403 9030 Furniture parts of wood 2,7 %
Source: EU TARIC
Since 1st May 2004, the Czech Republic has became an EU member and since
than EU customs legislation applies on all imports.
Details of customs duties and possible restrictions can be viewed on internet
website of EU dealing with customs tariffs:
http://ec.europa.eu/taxation_customs/dds2/taric
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7. TRADE FAIRS IN THE CZECH REPUBLIC
MOBITEX – INTERNATIONAL TRADE FAIR
OF FURNITURE AND INTERIOR DESIGN
MOBITEX fair is organized together with several other fairs: IBF –
International Building Fair, ENVIBRNO – International Enviromental Fair and
URBIS TECH – Fair of Communal Technology
Period: 25 – 29 April 2017
Venue: BVV Exhibition Grounds, city of Brno
Organizer: BVV Co. – www.bvv.cz/
LAST MOBITEX FAIR IN FIGURES
Total number of exhibitors 116 from 5
countries
Total exhibition area 3 135 sqm
Total number of visitors 43 223 number of visitors is
summary of visitors to IBF, ENVIBRNO and
URBIS fairs
Detailed information on MOBITEX fair in English can be found on the internet
websites of BVV Co., the organizer: www.bvv.cz/mobitex
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FOR INTERIOR FAIR - INTERNATIONAL FAIR OF INTERIORS
AND DESIGN
FOR INTERIOR fair is held simultaneously with FOR GASTRO & HOTEL
FAIR
Period: 29th September – 2nd November, 2016
Venue: Prague 9 – PVA Letnany
Organizer: ABF Co.
FOR INTERIOR 2015 IN FIGURES
Total number of exhibitors 487
Total net exhibition area 12 625 sqm
Total number of visitors 30 000
(together
with FOR
GASTRO
fair)
This fair is primarily focused on public – final customers (B2C event)
Detailed information on FOR INTERIOR in English can be found on the
internet website www.forinterior.cz
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8. CZECH FURNITURE ASSOCIATION
Association of Czech Furniture Manufacturers was founded in 1997. Main target
of the association is to promote and represent interests of companies involved in
development, production and sale of furniture.
The association has almost 70 members, majority of them are furniture and
accessories producers based in the Czech Republic.
Contact address of the association is:
ASSOCIATION OF CZECH
FURNITURE MANUFACTURERS
Office:
Na Poříčí 12
110 00 - Praha 1
E-mail : [email protected]
www.czechfurniture.com
Telefon : +420 222 313 640, +420 777 294 404
Fax : +420 222 313 640
Details on CZ association of furniture and directory of its members can be
viewed on the internet website www.czechfurniture.com
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9. SUMMARY
CZ is net exporter of furniture for homes and offices made of wood, metal
or plastics (HS 9403). Exports in 2015 reached 733 mil. USD while imports to
CZ 460 mil. USD.
Furniture is imported mostly from Poland (market share of 24,3 % in 2015),
Germany (22,1 %), China (12,4 %), Italy (6,2 %), Slovakia (7,5 %). Imports of
HS 9403 from Thailand reached 942 thous. USD in 2015 (mainly wooden
furtniture for homes).
According to latest research of INCOMA GfK market research agency, more
than two thirds of Czech customers prefer buying furniture in large
specialized stores. Key players on the Czech market are 7 large international
chains stores selling furniture and home accessories, such as IKEA, KIKA,
JYSK, ASKO etc.
Some of big Czech furniture producers have networks of their own retail stores
and showrooms, such as companies TON or JITONA.
Big international companies import furniture directly through their purchasing
departments (centralized for whole Europe in their countries of origin). Thai
furniture and accessories can be found in large international stores, such as
IKEA (IKEA is buying furniture through centralized purchasing department in
Sweden).
Average spending for furniture in 2015 by Czech customers was CZK 14 850,-
The average time of utilization of these kinds of furniture is almost 20 years
in CZ, whereas in advanced countries of the EU it is 10 years on average, and
then the futniture is replaced by new one. With the growing standard of living,
the period of utilization of furniture will decrease in the Czech Republic.
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10. OPPORTUNITIES FOR THAILAND
We can see opportunities for Thailand especially in wooden furniture made of
exotic wood. Currently, teak wood is getting more popular in the Czech
Republic – not only for garden furniture as in the past, but especially for indoor
furniture (furniture for dinning rooms, living rooms etc.). From cheaper
materials, in CZ we can see potential for furniture and accessories made of
rubber wood (especially kitchen tables, chairs, accessories etc.). Also rattan
furniture and water hyacint furniture have their customers in CZ, however
currently rattan furniture is imported mostly from Indonesia due to lower price.
Apart from teak wood, other kinds of exotic wood (such as rose wood) are
totally unknown among Czech consumers. More education and promotion is
necessary in order to increase consumers awarness. As exotic wood is attractive
alternative to traditional woods used in CZ (oak, pine, beech), there is potential
for Thai companies in this segment.
The first step for Thailand to take, should be connected with making furniture
from Thailand better known, for example by attending fairs held in the Czech
Republic, by co-operating with domestic importers and wholesalers, establishing
contacts with furniture associations etc.
When considering the fairs, we would recommend for Thai exporters to join the
MOBITEX INTERNATIONAL FAIR, that is held in the city of BRNO
MOBITEX is the most biggest furniture fair in the Czech Republic.
As the furniture market in the Czech Republic is dominated by 7 big
international players, we can see more chances in modern trade, such as e-
commerce (furniture e-shops).