Ms. Wang, a white-collar worker, is getting ready to move into her new home. Over the past couple of months, she’s been busy shopping around at various furniture stores and comparing prices. What surprised her was that the prices of brand-name furniture this year seemed more affordable compared to previous years. Even her favorite solid wood furniture wasn’t as costly as it used to be.
"In the past, purchasing solid wood furniture from larger furniture stores often meant spending anywhere from 10,000 to 20,000 yuan on items like wardrobes, beds, or dining tables," Ms. Wang explained. "And sofas could easily cost tens of thousands." But this year, many large pieces of solid wood furniture are priced under 10,000 yuan, and numerous merchants are offering special products. For instance, some pieces are available for as low as five or six thousand yuan, which would have been quite rare just a couple of years ago." This affordability has led many consumers to opt for solid wood furniture. Ms. Wang herself ordered two wardrobes and two beds for a total of 20,000 yuan, averaging out to just 5,000 yuan per piece.
Miss Wu from Yuzhu Timber Network also concurs that the price of solid wood furniture has dropped this year. Taking more expensive options like dark hardwood and mahogany furniture as examples, prices have indeed decreased. For instance, a set of seven-piece dining tables made from small-leaf red sandalwood from Sri Lanka, if purchased directly from the Zhongshan production base, now costs around 10,000 yuan, whereas it might have been priced at 12,000 yuan a couple of years ago.
It's worth noting that the ex-factory prices of high-end solid wood furniture have generally fallen by about 10% this year, with even bigger discounts seen in furniture stores. Reporters have observed that it’s not uncommon to see solid wood furniture discounted by 30-40%, while mahogany furniture can drop to as much as 50% off.
In addition to price drops, furniture stores seem particularly keen on solid wood furniture this year. At a large furniture store in Haizhu District, two of the six floors are dominated by solid wood furniture. In a mid-sized store in Tianhe District, solid wood furniture occupies the first and second floors. A salesperson mentioned, "Many customers these days want everything to be solid wood, especially families with children."
This year’s solid wood furniture is also more authentic. Previously, the norm was to label furniture as solid wood if it contained more than 70% wood. Now, many manufacturers emphasize “all solid wood†and “pure solid wood,†promising to clearly state these guarantees in sales documents.
The reporter noticed that Qu Mei Furniture, known for its sheet metal bending technology, has also launched a new Chinese-style solid wood series, with prices being quite high. Qu Mei confirmed to the reporter that this series was launched earlier this year. "Sheet furniture remains popular, but the positioning and pricing of solid wood series products are higher than those of sheet metal." Qu Mei added that their sales of another high-end solid wood series, which has been on the market for over a decade, have been strong. "In recent years, the sales growth rate of this series has surpassed that of sheet furniture."
In response, Wang Ke, president of the Guangdong Furniture Association, noted that this is the result of furniture manufacturers undergoing transformation and upgrading. "Over the past five years, the rapid development of panel furniture in the Yangtze River Delta has put greater competitive pressure on panel furniture manufacturers in Guangdong." Wang Ke pointed out that some pure panel furniture manufacturers in Guangdong have started shifting towards producing panel wood and solid wood furniture.
One significant reason for the drop in solid wood furniture prices is the decline in raw material costs for furniture machinery purchases," Wang Ke highlighted. Recently, the China Timber Price Index (TPI) released by the China Timber and Wood Products Circulation Association showed that in September 2012, the comprehensive price index for imported wood in China was 108.9%, down 10.4% year-on-year.
At the Yuzhu International Timber Market, a well-known timber distribution center in the country, there’s a noticeable lack of activity. Many shops are closed, and some vacant spaces are filled with only a few short stacks of wood, giving the place a desolate look. According to Miss Wu from the Yuzhu Timber Market, business is slow this year, with sluggish demand and businesses reluctant to stockpile large inventories. Additionally, storing excessive inventory is costly.
The price index released by Yuzhu Timber Network shows that domestic sawn timber prices have only slightly increased since 2011. The domestic sawn timber index reached a high of 139.47 points at the end of March 2011, before dropping slightly to reach a high of 144.43 points at the end of May this year, an increase of less than 4%.
Analysts also noted that due to the sluggish furniture export market, many export furniture manufacturers had to redirect part of their business to the domestic market, intensifying competition. Naturally, businesses have responded with certain discounts. Some merchants’ special products have driven the prices of large pieces of solid wood furniture down to just a few thousand yuan. These affordable solid wood furniture items are primarily produced in Russia and Northeast China, including basswood, oak, and birch. While the price of imported wood has also dropped, the price remains significantly higher than domestic solid wood furniture.
"Market competition has squeezed factory profits and pushed solid wood furniture prices down," Wang Ke emphasized. In recent years, the mechanization level of furniture production has increased, reducing the labor hours required for producing individual solid wood furniture pieces and improving the overall material utilization rate to around 90%, promoting the popularization of solid wood furniture and reducing prices. Qu Mei also mentioned that since they offer various types of products including solid wood, board wood, and board furniture, they can reduce product costs.
Despite the price drops, solid wood furniture still isn’t the mainstream in the market. "Solid wood furniture is the traditional mainstay of Chinese furniture, and its sales are stronger domestically," noted Yang Zhihua, secretary general of the Lecong Furniture Association. He pointed out that solid wood furniture carries more cultural heritage, appealing to younger, educated buyers who value the appreciation potential of furniture. However, Yang Zhihua also noted that panel furniture remains dominant in the Guangdong furniture market.
"Saying solid wood is always high-end isn't accurate," Wang Ke reminded consumers. Generally, the cost of raw materials and manufacturing processes for solid wood furniture is higher than for panel furniture, but panel furniture has its own advantages. "Panel furniture is stable and easy to shape, avoiding issues like decay and insect damage." Manager Wu from Guangdong Yonglong Furniture Factory pointed out that many panel manufacturers have already produced E0-grade panels, fully meeting environmental standards.
Regarding pricing, Yang Zhihua noted that based on consumer positioning, the price trend of solid wood furniture varies greatly. "In recent years, the preservation and appreciation value of mahogany furniture has been prominent, attracting many buyers and driving prices up. However, currently, other types of solid wood furniture remain largely functional." Yang Zhihua reminded that the domestic furniture market is heavily influenced by the real estate market, and it will take time for the furniture market to fully flourish and see price increases.
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