Ms. Wang, a white-collar professional, is preparing to take possession of her new home. Over the last couple of months, she’s been on the go, visiting furniture stores and comparing prices. What surprised her was that this year's prices from brand-name furniture agents seemed more reasonable than in previous years. Even her beloved solid wood furniture wasn’t as expensive as it used to be.
"In the past, some of the larger solid wood pieces in big furniture malls—like wardrobes, beds, or dining tables—often cost between 10,000 to 20,000 yuan," Ms. Wang explained. "Sofas could easily run into tens of thousands of yuan. But now, many of these big solid wood items are under 10,000 yuan, and a lot of merchants have introduced special products. You can get a large piece of furniture like a wardrobe or bed for as little as 5,000 to 6,000 yuan—something that was rare just a couple of years ago." The 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 just 5,000 yuan per piece.
Miss Wu from Yuzhu Timber Network also agreed that the price of solid wood furniture has dropped this year. "Take our more expensive dark and hardwood furniture, like mahogany, for instance. Prices this year have definitely decreased," she noted. "For example, a set of seven-piece dining tables made from small-leaf red sandalwood from Sri Lanka, if purchased directly from the Zhongshan production base, would cost around 10,000 yuan this year, whereas it might have been around 12,000 yuan just a couple of years ago."
It’s reported that the ex-factory prices of high-end solid wood furniture have generally fallen by about 10% this year, and the discounts in furniture stores have been even more significant. Reporters have noticed that it's quite common to see solid wood furniture being discounted by 30%-50%, and mahogany furniture has even dropped to 50%.
"From sheet furniture to solid wood furniture," manufacturers seem to be showing a particular preference for solid wood furniture this year. A reporter visiting a large furniture mall in Haizhu District found that two of the six floors were dominated by solid wood furniture. In a medium-sized furniture store in Tianhe District, solid wood furniture occupied the first and second floors. A salesperson at the store mentioned, "Many customers now want everything to be solid wood, especially families with children."
Additionally, this year’s solid wood furniture is becoming more authentic. Previously, the industry standard was to label furniture as solid wood if it contained more than 70% solid wood. This year, many manufacturers are emphasizing "all solid wood" and "pure solid wood" as key selling points, promising to clearly state "guaranteed all solid wood" or "pure solid wood" on 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 that are quite high. Qu Mei Company confirmed to reporters that this series was launched earlier this year. "Sheet furniture remains more popular, but the positioning and pricing of our solid wood series products are higher than those of sheet metal furniture," the company stated. It was also noted that sales of another high-end solid wood series launched over a decade ago 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, pointed out that this is the result of manufacturers undergoing transformation and upgrading. "Over the past five years, the rapid development of panel furniture in the Yangtze River Delta has put more competitive pressure on panel furniture manufacturers in Guangdong," Wang Ke explained. He added that some pure panel furniture manufacturers in Guangdong have started shifting towards producing panel wood and solid wood furniture.
"The drop in the price of solid wood furniture is largely due to the decline in the price of raw materials for furniture machinery purchases," Wang Ke noted. The China Timber and Wood Products Circulation Association recently released the China Timber Price Index (TPI), which showed that in September 2012, the comprehensive price index of China's imported wood was 108.9%, a year-on-year decrease of 10.4%.
At Yuzhu International Timber Market, a well-known timber distribution center across the country, there was no bustling activity or towering timber stacks. Many shops were closed, and some empty shops were filled with just one or two small piles of wood, giving the place a deserted look. According to Miss Wu of Yuzhu Timber Market, this year’s market has been slow, with weak demand and businesses reluctant to stockpile large inventories. Additionally, the cost of storing too much inventory was relatively high.
The price index released by Yuzhu Timber Network shows that domestic sawn timber has only slightly increased since 2011. The domestic sawn timber index reached a high of 139.47 points at the end of March 2011, then fell slightly to reach a high of 144.43 points at the end of May this year, increasing by less than 4%.
Moreover, analysts pointed out that due to the sluggish furniture export market, many export furniture manufacturers had to redirect part of their export business to the domestic market, leading to fiercer competition. Naturally, businesses would offer certain discounts. Some of the special products introduced by merchants have driven the prices of large solid wood furniture down to just a few thousand yuan. These affordable solid wood furniture items are primarily produced in Russia and Northeast China, such as basswood, oak, and birch. While the price of imported wood has also fallen, the cost is still significantly higher than that of domestic solid wood furniture.
"Market competition has squeezed factory profits and pushed solid wood furniture prices down," Wang Ke emphasized. He added that in recent years, the level of mechanization in furniture production has increased, shortening the time required to produce single pieces of solid wood furniture. Improved material utilization rates have generally reached 90%, promoting the widespread availability and price reduction of solid wood furniture. Qu Mei also noted that since they offer various types of products including solid wood, board wood, and sheet metal, they can reduce product costs.
"Solid wood furniture is the mainstream of traditional Chinese furniture, and its sales in the domestic market are doing well," Yang Zhihua, Secretary General of the Lecong Furniture Association, pointed out. He noted that solid wood furniture carries more cultural significance, and younger, educated buyers are paying more attention to the appreciation value of furniture. However, Yang Zhihua also emphasized that panel furniture remains dominant in the Guangdong furniture market.
"Not all solid wood furniture is high-end," Wang Ke cautioned consumers. Generally speaking, the cost of raw materials and manufacturing processes for solid wood furniture is higher than for sheet furniture, but sheet furniture also has its own advantages. "Panel furniture is stable and easy to shape, avoiding issues like decay and insect infestation," noted Manager Wu of the Marketing Department at Guangdong Yonglong Furniture Factory. He added that many board manufacturers have already produced E0-grade boards, which fully meet environmental standards.
Regarding pricing, Yang Zhihua noted that depending on consumer positioning, the price trend of solid wood furniture varies greatly. "In recent years, the value-preserving and appreciating characteristics of mahogany furniture have been prominent, attracting many buyers, and the price has risen at times. However, currently, other types of solid wood furniture are still mainly functional." Yang Zhihua reminded that domestic furniture is heavily influenced by the real estate market, which is large. It will take a long time for the furniture market to fully flourish and experience price increases.
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