Solid Wood Furniture Prices Rise Again And Again The Price Increase Rate Is 3%-5%

- May 31, 2018 -

The continuous rise in raw material costs and labor costs has once again affected the sales of furniture terminals. The reporter recently visited a number of furniture stores and learned that, in addition to some manufacturers that have long signed supply agreements can maintain the original price unchanged in the short term, some solid wood furniture brands ushered in the second price increase this year, the price increase rate of 3% ~5% or so.

Rising costs are the main reason for price increases

"If you look at the oak bed, you can place an order early. We received a factory notice a few days ago. We have to raise the price this week. We must spend a few hundred dollars more to buy it." Days, Chongqing, a solid wood furniture salesman Shuguang Mei one after another informed the intended customers, after entering in June, the company's product prices will be increased by 5%.

Yang Shanrong, head of a solid wood furniture factory in Chongqing, told reporters that furniture companies are labor-intensive industries. The increase in labor costs has led to an increase in manpower costs for companies; prices for wood, paint, and hardware accessories have also risen significantly, leading to increased material costs. Under such cost pressures, product prices are inevitable. “We have risen 5% before and after the Spring Festival this year and are now up about 3%.” Yang Shanrong said that last year it cost only 5,000 yuan to buy one ton of oak, but now it’s more than 6,000 yuan. The labor cost has also increased a lot compared to last year. Guaranteed prices can only increase prices.

The reporter learned from the China Timber Distribution Association that Southeast Asia, Africa, North America, and Russia have always been China's major sources of timber imports, but under the combined effects of reduced resources, national policy restrictions, exchange rates, and rising transportation costs, Wood prices have increased significantly over the past two years. Rising wood prices, coupled with the ever-increasing purchase and transportation costs of factories, have finally contributed to recent price increases for some solid wood furniture brands.

The reporter made a cursory statistics. So far, at least two solid wood furniture brands have increased their prices, and there are six other companies that are preparing to raise prices in late June.

However, the reporter learned from the interview that most consumers did not change their buying plans because of the price increase of solid wood furniture. Zhang Junqin, who lives in Shapingba, said that he does not rule out that individual brands will ease the pressure of price hikes by means of shoddy or cutting corners. Therefore, they should not only look at the price, but must recognize the brand and quality.

Worried about the loss of customers due to price increases

In the interview, the reporter found that many sellers and manufacturers are very cautious about price increases in a bad market environment. They all said that the most worrying factor was the loss of customers due to price increases.

Gao Jun is an agent of a solid wood furniture brand in Chongqing in Guangdong. She believes that price increases are a double-edged sword. If the price does not increase, the profit will decrease if the cost increases; and if the price rises in the market, the consumption enthusiasm will be dampened. “I only made a few orders for this month, and I have to remove rent, utilities, and labor costs. There is no profit at all. I am afraid that after the price is raised, the days will be even more sad.” Gao Jun said, but if manufacturers want to raise prices, The agent, she also only followed the price increase.

In the interview, the reporter learned that some solid wood furniture manufacturers have risen once in the beginning of this year. This is the second price increase, but the current increase in raw material costs by 15% and the general increase in labor costs by 20% are the status quo. The price increase rate of 3% to 5% still appears to be more cautious.

Yang Shanrong told reporters that this is because manufacturers must not only consider cost pressures, but must also consider market conditions comprehensively. "I will choose to reduce some of the cost by compressing the internal cost method. At the same time, the stores will try to reduce the frequency and magnitude of profit sharing to protect costs, and the impact of price increases will be handled in a low-key manner, so that consumers are also more likely to be psychologically acceptable." Say.

The industry believes that with the further increase in costs, the solid wood furniture industry will be more intense competition, some small and medium-sized enterprises in the face of fierce competition or will be difficult to maintain the industry's reshuffle will be further intensified.

Good composition of furniture replacement

According to news recently, on July 1, Beijing is expected to release its old-fashioned furniture replacement policy. Subsequently, the Ministry of Commerce stated that the trade-in of furniture is expected to be promoted throughout the country.

For this possible policy, the furniture manufacturers in our city have different opinions.

Gao Jun said that the furniture market is far less popular than before. If a preferential policy is introduced at this time, it will surely stimulate the furniture market. This is undoubtedly a "strengthening". The owner of a furniture sales mall in Jiangbei said that it is difficult to accept old furniture collection. “Our company is headquartered in Guangdong. If the old furniture is recycled, the cost is too high to implement it.”

Li Chengda, secretary general of the Chongqing Furniture Association, told reporters that if the furniture replacement policy is really introduced, it will be a good thing for the furniture industry as a whole. It will not only stimulate domestic demand but also solve the problems of many citizens. However, because the current old furniture is generally difficult to handle, the logistics, warehousing, and secondary use of used furniture are all problems. Only powerful large-scale furniture companies can do, at least it is necessary to establish an old furniture industry chain.


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