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Furniture

Executive Summary
This sector fact sheet provides key trade and investment related statistics for the furniture sector. Specifically, it
shows global trade and investment flows including an analysis of top markets and products for South Africa and
the Western Cape highlighting the largest and fastest growing products and sub-sectors. The key highlights in the
furniture sector are provided below:

SECTOR OVERVIEW

In the last 10 years, world trade of furniture has grown faster than furniture production, and has
consistently amounted to about 1% of the world trade of manufactures.

Current trends in the South African furniture sector include major retailors providing e-commerce services
such as online buying as well as increased consumer confidence and increased value sales.

TRADE

Global trade in furniture was worth ZAR1.18trn in 2012, growing by 18% from 2011.

South Africas exports of furniture was worth ZAR4.26bn in 2013 and grew 50.3% from 2012.

Western Capes exports of furniture was worth ZAR282m in 2012 growing by 4.4% from 2011.

Parts of seats are the Western Capes largest furniture export in value terms, reaching ZAR107m in 2012
and a compound Annual Growth Rate (CAGR) of 7% was experienced in this sub-sector from 2004 to
2012.

The Western Cape used to be a net exporter of metal furniture but from 2006 become a net importer with
an import CAGR of around 24%.

Germany was the leading destination market for furniture products from South Africa in 2013 (ZAR1.1bn),
and from the Western Cape in 2012 (ZAR70m)

Seven out of the top ten South African export destination markets for furniture are other African countries.

Six out of the top ten Western Cape export destination markets for furniture are other African countries.

INVESTMENT

Foreign Direct Investment (FDI) into the South African furniture sector between 2003 and 2013 reached
ZAR649.71m, which is an average investment of ZAR129.78m per project.

South Africa is the 21th largest source market for global FDI projects in this sector and the 49th largest
destination market.

Poltrona Frau invested ZAR300m in the Cape Town in March 2012 for a furniture retail project.

1.

Sector Overview

The global furniture sector includes all movable articles that are used to make a room or building suitable for living
or working in, such as tables, chairs, or desks. The definition used in this sector analysis also includes mattresses
and parts of furniture that are not yet compiled. It specifically excludes medical, dental or veterinary furniture as
well as all rotating, reclining and elevating seats. This sector review will look at the retail sale of furniture globally
and particularly in South Africa and the Western Cape.
The products assessed in this sector are classified under domestic or household furniture, including office furniture.
Furniture is usually divided by function into the following sub-sectors:
SUB-SECTORS OF DOMESTIC AND OFFICE FURNITURE
SUB-SECTORS
Upholstered seating
Non-upholstered seating
Dining and living room furniture

Kitchen furniture
Bedroom Furniture
Office furniture
Other furniture
Furniture parts

PRODUCT GROUPS
Armchairs, reclining chairs, couches, sofas, divans,
footstools, seating elements upholstered with leather, wool,
synthetic material, cotton etc.
Seats, armchairs, rocking chairs, seats convertible into
beds, stools
Dining sets (tables and chairs), dressers, coffee tables,
sideboards, shelf systems, room dividers,
television/video/music system storage units
Fitted cabinets and kitchen units, kitchen tables and chairs,
free-standing pieces such as movable trolleys and butcher
blocks
Beds, headboards, bedside tables, dressing tables, chests
of drawers, wardrobes (fitted or free standing)
Desks, chairs, drawer units, filing cabinets, integrated
workstations
Cupboards, bookcases and wall units, mirrors, hall stands,
bathroom furniture such as baskets
Parts of furniture or seats, including semi-finished furniture

Source: cbi, 2014

In addition to its function, furniture can also be defined by material or content or by style. Furniture by raw material
can be classified as:

Wood

Cane, osier, bamboo, etc.

Metal

Plastic/synthetic

Stone

Glass

Combination of materials
The materials used in the furniture manufacturing process affects the prices and profit margins in the furniture
sector. The global commodity prices that can be analysed include cotton, iron, steel and aluminium. The graphs
below show the prices of the commodities and the percentage change in price from year to year. All of the
commodities experienced large dips in 2009 due to the financial crisis as well as in 2012 due to many developed
economies experiencing a double-dip recession, US dollar appreciation and a slowdown in global demand.
Interestingly, none of the metal commodity prices are forecast to rise above pre-crisis levels and all the commodities
below are forecast to stabilise to a certain degree.

Cotton prices range between 57USc/lb and 138USc/lb, with quite a high volatility. From 2014 the price is
forecast to average around 80 to 90USc/lb.

Iron prices range between 84USD/tonne and 176 USD/tonne, with quite a high volatility. From 2014 the
price is forecast to average around 90 to 100 USD/tonne.

Aluminium prices range between 1704USD/tonne and 2425USD/tonne, with quite a high volatility. From
2014 the price is forecast to rise steadily from 1800USD/tonne to 2200 USD/tonne in 2018.

Steel prices range between 612USD/tonne and 935USD/tonne, with quite a high volatility. From 2014 the
price is forecast to average around 690USD/tonne.

GLOBAL COTTON PRICES, 2008-2018


160

80

140

60
40

100

USc/lb

20
80
0
60
-20

40

Percentage change (%)

120

-40

20
0
Cotton Price, USc/lb, ave

2008
63,6

2009
57,1

2010
94,1

2011
137,5

2012
79,7

2013
83,4

2014f
82,0

2015f
84,0

2016f
86,0

2017f
89,0

2018f
91,5

Cotton price, ave, % y-o-y

11,2

-10,2

64,8

46,1

-42,0

4,6

-1,6

2,4

2,4

3,5

2,8

-60

Source: BMI, 2014

GLOBAL IRON PRICES, 2008-2018


200,0

100

180,0

80
60

USD/tonne

140,0
120,0

40

100,0

20

80,0

60,0

-20

40,0
20,0

-40

0,0

-60

2008 2009 2010 2011 2012 2013 2014f 2015f 2016f 2017f 2018
Iron Ore Price, USD/tonne, ave 152,5 84,5 153,4 175,5 128,6 135,2 108,0 100,0 95,0 90,0 85,0
Iron ore price, ave, % y-o-y

25,6

-44,6

81,5

14,4

-26,7

5,1

-20,1

-7,4

-5,0

-5,3

Percentage change (%)

160,0

-5,6

Source: BMI, 2014

GLOBAL ALUMINIUM PRICES, 2008-2018


3000

40

20

USD/tonne

2000

10

1500

0
-10

1000

-20
500
0
Aluminium Price, Three-month,
USD/tonne, ave

-30
2008 2009 2010 2011 2012 2013 2014f 2015f 2016f 2017f 2018
2623 1704 2193 2421 2053 1887 1850 1900 2000 2100 2200

Aluminium price, three-month, ave, %


-1,5
y-o-y
Source: BMI, 2014

-35,0 28,7

10,4 -15,2

-8,1

-2,0

2,7

5,3

5,0

4,8

-40

Percentage change (%)

30

2500

GLOBAL STEEL PRICES, 2008-2018


1000

30

900

USD/tonne

700

10

600

500
400

-10

300

-20

200

-30

100
0

2008

2009

2010

2011

2012

2013 2014f 2015f 2016f 2017f 2018

Percentage change (%)

20

800

-40

Steel Price, Global Carbon Steel


935,0 612,3 733,4 854,3 757,2 708,1 695,0 690,0 685,0 690,0 690,0
Composite, USD/tonne, ave
Steel price, Global Carbon Steel
Composite, ave, % y-o-y

-34,5

19,8

16,5

-11,4

-6,5

-1,8

-0,7

-0,7

0,7

0,0

Source: BMI, 2014

1.1

The Global Furniture Sector

In 2013, the world furniture market was worth USD463bn and forecasts from CSIL, a leading Italian independent
research center, expect furniture consumption growth to exceed 3% by the end of 2014. This growth is expected
to vary in different regions of the world. Western Europe is expected to remain stable with moderate growth in North
and South America and fast growth in emerging market economies, particularly in Asia. The nature of furniture
sales has changed from ready-assembled pieces to more ready-to-assemble (RTA) pieces from 1970 onwards
with the expansion of IKEA.
Traditional furniture-making countries continue to account for over 70% of the global market, for example the EU
accounts for around half of the worlds furniture production. This is possible because of their long established
production capacity, advancement in science and technology, funds and rich management experiences.
Developing countries and regions like China, Southeast Asia, Poland and Mexico, have built upon their competitive
advantages and have gradually obtained around 30% of the world market.
In the last 10 years, world trade of furniture has grown faster than furniture production, and has consistently
amounted to about 1% of the world trade of manufactures. The global import penetration for furniture (measured
as the ratio between imports and consumption) rose from 27.8% in 2003 to 30.6% in 2007. In 2008 and 2009, it
decreased as a consequence of the recession, and remained below the pre-recession maximum thereafter.
According to the Forbes 2000, the list of worlds biggest public companies, the furniture companies that are in the
top 2000 include Steinhoff International, Mohawk Industries and Jarden. Steinhoff International is headquartered
in Johannesburg and employs 79,818 people. It is an integrated retailer, which manufactures, sources and retails
furniture and household goods in Europe, Africa and the Pacific Rim. Its diversified industrial businesses in southern
Africa provide supply chain and logistics services, timber products and other raw materials. African listed
subsidiaries, include KAP Industrial Holdings and JD Group Limited. Mohawk Industries, Inc. manufactures and
distributes residential and commercial flooring. It offers a carpet, ceramic tile, wood, stone, laminate, vinyl, rugs
and other home products. The company operates through three reporting segments: Mohawk, Dal-Tile and Unili.
TOP PERFORMING FURNITURE COMPANIES, 2014
FORBES 2000
RANKING

COMPANY

COUNTRY

MARKET VALUE

672

Steinhoff International

South Africa

USD10.5bn

1371

Mohawk Industries

United States

USD10bn

1578

Jarden

United States

USD8bn

Source: Forbes, 2014

1.2

South African Furniture Sector

When considering the South African consumer spending on furniture over time we have used the broad definition
which is the sum of spending on household furniture for all household rooms such as chairs, sofas, tables, beds,
cupboards, ornaments, mirrors, baby furniture, bedding, ceramics, etc. It also includes carpets and other floor
coverings and furniture repairs which are not included in the trade and investment analysis.
According to Euromonitor, business conditions saw a significant improvement during 2012 for furniture and
homeware stores. Consumer confidence improved during the first quarter of the year, leading to improved value
sales for the year. Stricter credit evaluation policies by retailers offering credit also led to improved value sales, as
the number of defaulting customers declined. This led to improved growth forecasts for the period 2012 to 2018 of
around 6%. A vast improvement from the negative growth of around 3% from 2007 to 2011. Although there has
been negative spending from 2007 to 2011 in furniture spending, strong growth rates have been forecast for private
final consumption across South Africa of above 5%. This is expected to trickle down positively across all 13 areas
of household spending including furniture and furnishings spending.

14

12

10

-2

-4

0
Furniture and furnishings spending, ZARbn
Furniture and furnishings spending, ZAR % y-o-y

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
10,8
0

9,5

10,0

10,5

11,0

11,6

12,3

12,9

-3,24 -3,35 -3,46 -3,59 -3,72 5,36

10,4

10,1

9,7

9,4

9,0

4,97

4,80

5,43

5,45

5,43

5,68

% Growth

Value (ZARbn)

FURNITURE AND FURNISHINGS SPENDING IN SOUTH AFRICA, 2006-2018

-6

Source: BMI, 2014

Growth in the furniture sector was encouraged due to the rapidly growing popularity of the internet for retail which
has attracted furniture retailers towards e-commerce. South Africa-based website Nevada Furniture has built a
business by sourcing Swedish furniture retailer IKEA's products and delivering them to local customers. High-end
furniture makers, such as Wetherlys, have also launched e-commerce portals to tap into the potentially huge
market. The JD Group, a South African furniture retailer and financial services provider is also planning to open at
least 50 stores in rural areas. Their stores include Russels, Joshua Doore and Bradlows furniture.

1.2.1 South African Furniture Associations


SOUTH AFRICAN FURNITURE ASSOCIATIONS
ASSOCIATION
Forest Industries Education
and Training Authority

Furntech

FOCUS
The creative challenge for all people in the forest
industries is to optimise the beneficiation of trees.
FIETA helps to develop the skills to meet this
challenge.
Furntech's mission is to be a globally competitive,
outcomes-based training provider that offers
comprehensive and innovative business incubation
services in order to assist in job and wealth creation in
South Africa's furniture and wood products sector.

CONTACT

http://www.fieta.org.za/

http://www.furntech.org.za/about-us/aboutus

The wood and paper industries in South Africa also have a Competitiveness Enhancement Incentives (ECA)
managed by the IDC. These are investments which facilitate increased competitiveness, sustainable economic
growth and development in a specific sector. Focus areas are projects and investments in forestry, pulp and paper,
furniture, saw milling, board production and renewable energy. The applicability is competitive risk-related interest
rates based on the prime bank overdraft rate.

1.3

Western Cape Furniture Sector

The manufacture of furniture in the Western Cape is depicted in the graph below. The graph shows that over time
the percentage contribution of furniture and other manufacture is declining as a percentage of GDP from 2.04% in
2003 to 1.66% in 2011. The value of the furniture manufacturing sector in the Western Cape peaked in 2008 at
ZAR3.4bn and has since declined to ZAR3.08bn in 2011.

FURNITURE MANUFACTURING IN THE WESTERN CAPE: CONTRIBUTION TO GDP, 2003-2011


4,0

2,5%

3,5
2,0%
3,0

VALUE (ZARbn)

1,5%

2,0
1,0%

1,5
1,0

0,5%
0,5
0,0
Furniture and other manufacturing
(ZARbn)
% of total GDP

2003

2004

2005

2006

2007

2008

2009

2010

2011

2,74

2,83

2,98

3,13

3,24

3,40

3,07

3,09

3,08

2,04%

2,00%

1,98%

1,96%

1,91%

1,92%

1,76%

1,71%

1,66%

0,0%

Source: Quantec, 2014

1.3.1 Western Cape Furniture Associations


The Western Cape has a few associations that provide support to the furniture sector in the Province. They can
be seen in the table below:
WESTERN CAPE FURNITURE ASSOCIATIONS
ASSOCIATION

FOCUS

CONTACT

Cape Furniture
Manufacturers Association
(CFMA)

Provide support for collective bargaining and


representation.

http://www.cfma.org.za/

Western Cape Furniture


Initiative

To develop and grow the furniture industry in a


sustainable manner through the implementation of
programmes and interventions that will improve the
industry skills and making the furniture industry
globally competitive

http://www.capefurniture.za.org/about.htm

Furniture Bargaining Council


for the Western Cape

Representation, mediation and administration

http://www.furniture.org.za/about.htm

% CONTRIBUTION TO GDP

2,5

1.3.2 Western Cape Furniture Sector Value Chain


Companies in the furniture value chain in the Western Cape are presented below. These are the companies
registered under the Companies and Intellectual Properties Commission (CIPC) under furniture manufacture
[SIC931], furniture and requisite wholesale [SIC6139] and furniture retail outlets [SIC6233].

MANUFACTURE [SIC931]
CARLIZE ELS INTERIOR
DESIGN CONSULTANT
COTTAGE FURNITURE
MANUFACTURERS
DREAMWORKS KITCHENS
JUAN ARCHITECTURAL
INTERIOR DESIGN PROJECTS
MILO'S CABINET WORKS
RENSILVLEI
BC WOODWORKS
CCC MANUFACTURING
DIENER CUPBOARDS
MAVERICK TRADING 399

Source: BFA, 2014

WHOLESALE DISTRIBUTORS
[SIC6139]
360 DEGREE BLINDS AND
PROJECT SOLUTIONS
A AND E FURNITURE
A AND G FURNITURE
SUPPLIES
ADESSO WHOLESALE
AMABANE AIRCONDITIONING
BHOFOLO FURNISHERS
BRICKFIELD OFFICE
FURNITURE AND TRADING
CONTRAFURN
CRAFTWELL KITCHENS AND
INTERIORS
DAVE WATLING AGENCIES
FUTURE FURNISHERS
GOUROUX
HOT TUNA PROPS
HUNTERS AIR
INTERNATIONAL FURNITURE
HOUSE
J AND B SATELITES
KZN KITCHEN CUPBOARDS
LATIF FURNISHERS
LEZMIN 2748
LOW PRICE FURNISHERS
MAGNUM MEUBELS
MAP FURNITURE
WAREHOUSE
NATALIA FURNISHERS
SEAWOLF MARINE
SEN-AD
SHAINE AMIKA TRADING
SUPER PRICE FURNISHERS
VARI-VEST FOURTEEN

RETAIL OUTLETS [SIC 6233]


CHEAP SLEEP
LE JACQUES BEACH HOUSE
D'COR
LIGHTHOUSE LOUNGE
OFFICE MAD LIQUIDATION
CENTRE
THE BEDROOM SHOP

2.

Trade

2.1

Global Trade in the Furniture Sector

Global exports of furniture products increased steadily from 2004 to 2008, before a dip in 2009. However increases
in exports were recorded from 2010 to 2012, with 2012 recording the highest exports of furniture products over the
ten year period. Global exports of furniture increased from ZAR606bn in 2004 to ZAR1.18trn in 2012. In 2012,
exports of furniture products increased by 18%, the highest growth since pre-crisis levels.
GLOBAL FURNITURE TRADE, 2004-2012
1 400

25
20

1 200

15
10

800

600

% growth

Value (ZAR bn)

1 000

-5

400

-10
200
0
Trade (ZARbn)
y-o-y Growth (%)

-15
2004
606

2005
661

2006
768

2007
930

2008
1 110

2009
911

2010
926

2011
1 002

2012
1 184

16

21

19

-18

18

-20

Source: TradeMap, 2014

As can be seen below, China was the leading source market for furniture products in 2012, valued at ZAR455bn,
followed by Germany and Italy valued at ZAR92bn and ZAR87bn respectively. Other top source markets were
Poland (ZAR69bn) and the United States (ZAR57bn). Four of the top 10 source markets are European markets.
South Africa is ranked 40th, exporting furniture to the value of ZAR2.8bn.
TOP 10 EXPORTING MARKETS FOR FURNITURE, 2012
RANK

SOURCE MARKETS

VALUE
2012
(ZARbn)

%GROWTH
2011-2012

China

455

42.9%

Germany

92

5.8%

Italy

87

6.1%

Poland

69

5.1%

United States of America

57

28.1%

Mexico

47

36.4%

Viet Nam

40

79.4%

Canada

31

17.7%

Malaysia

22

17.5%

10

France

20

3.5%

40

South Africa

2.8

-13%

1 721

25.6%

TOTAL
Source: TradeMap, 2014

The top 5 export products from each of the top 3 export markets are listed below:
China (HS10)

Metal furniture (ZAR76bn)

Wooden furniture (ZAR71bn)

Other upholstered and metal framed seats (50bn)

Furniture parts (ZAR47bn)

Articles of bedding with man-made stuffed fibre (ZAR39bn)


Germany (HS10)

Fitted kitchens (ZAR19bn)

Non-wooden seat parts (ZAR17bn)

Metal furniture (ZAR13bn)

Parts of metal furniture (ZAR7bn)

Wooden furniture for bedrooms (ZAR6bn)


Italy (HS10)

Wooden furniture (ZAR16bn)

Upholstered seats with wooden frames (ZAR14bn)

Non-metal and wood parts of furniture (ZAR10bn)

Wooden parts of furniture (ZAR9bn)

Fitted kitchen units(ZAR7bn)


The United States was the leading global destination market for furniture products in 2012, valued at ZAR310bn,
followed by Germany and France valued at ZAR105bn and ZAR64bn respectively. Other top source markets were
the United Kingdom (ZAR59bn) and Japan (ZAR55bn). South Africa is ranked 34th, furniture importer worth
ZAR5.5bn.

TOP 10 IMPORTING MARKETS FOR FURNITURE, 2012


RANK

DESTINATION
MARKETS

VALUE
2012
(ZARbn)

% GROWTH
2011-2012

United States

310

24.7%

Germany

105

4.7%

France

64

7.8%

United Kingdom

59

13.4%

Japan

55

25.9%

Canada

53

23.5%

Netherlands

28

4.1%

Switzerland

27

9.2%

Australia

24

18.7%

10

Belgium

24

3.9%

34

South Africa

5.5

16%

1 184

18.1%

TOTAL
Source: TradeMap, 2014

The top 5 imported products from each of the top 3 import markets are listed below:
United States (HS10)

Wooden furniture (ZAR44bn)

Seat parts used for motor vehicles (ZAR43bn)

Household seats that are upholstered with wooden frames (20bn)

Wooden bedroom furniture (ZAR19bn)

Household chairs upholstered and wooden framed chairs (ZAR15bn)

Germany (HS10)

Non wooden seat parts (ZAR37bn)

Household seats that are upholstered with wooden frames (ZAR14bn)

Wooden furniture for dining room and living room (ZAR10bn)

Wooden furniture (ZAR9bn)

Metal furniture (ZAR7bn)


France (HS10)

Upholstered seats with wooden frames (ZAR9bn)

Non- wood parts of seats (ZAR8bn)

Wooden furniture (ZAR7bn)

Metal furniture (ZAR5bn)

Wooden furniture for dining room and living room (ZAR5bn)


Parts of seats was the largest globally imported furniture product in 2012, valued at ZAR215.3bn. Wooden furniture
is the second largest furniture product with trade valued at ZAR190.2bn, other products include upholstered seats
with wooden frames and metal furniture valued at ZAR115.1bn and ZAR104.9bn respectively. High growth in value
from 2011 to 2012 was seen in upholstered seats with metal frames (35.1%) as well as in other metal furniture
(24.4%).
TOP 10 GLOBALLY TRADED FURNITURE PRODUCTS, 2012
RANK

PRODUCT

VALUE
2012
(ZARbn)

%
GROWTH
2011-2012

Parts of seats other than those used for surgery, elevation, swivelling or reclining

215.3

19.6%

Furniture, wooden, nes

190.2

14.2%

Seats with wooden frames,upholstered nes

115.1

19.6%

Furniture, metal, nes

104.9

24.4%

Furniture parts nes

93.1

14.4%

Bedroom furniture, wooden, nes

77.7

19.3%

Articles of bedding/furnishing, nes, stuffed or internally fitted

69.0

15.8%

43.0

13.3%

37.9

35.1%

36.2

14.0%

1183.8

18.1%

8
9
10

Seats with metal frames, nes, other than those used for surgery, elevation, swivelling
or reclining
Seats w metal frames,upholsterd nes,oth than those used for surgery, elevation,
swivelling or reclining
Kitchen furniture, wooden, nes

TOTAL TRADE
Source: TradeMap, 2014

10

2.2

South African Furniture Trade

South African exports of furniture has been volatile over the past decade. Imports rose sharply from 2012 to 2013,
increasing by 16%. Exports declined from 2011 to 2012, increasing the negative trade balance experienced by
South Africa. South Africa has not always been a net importer of furniture, for example from 2004-2007 South
Africa was a net exporter as well as in 2009 and 2010. The change in South Africas trade position is due to an
increase in imports from emerging markets such as China, as their competitive advantage in this industry is
increasing.

SOUTH AFRICAN FURNITURE TRADE, 2004-2013


6
5

Value (ZARbn)

4
3
2
1
0
-1
-2
-3
Import (ZARbn)

2004
1,53

2005
2,30

2006
3,04

2007
3,58

2008
4,06

2009
3,15

2010
3,81

Exports (ZARbn)

4,08

3,50

3,24

Trade balance (ZARbn)

2,54

1,20

0,20

2011
4,06

2012
4,80

2013
5,58

3,73

4,04

3,27

3,96

3,27

2,83

4,26

0,15

-0,02

0,12

0,15

-0,79

-1,96

-1,32

Source: TradeMap, 2014

Germany was the leading destination market for furniture from South Africa in 2013, with a value of ZAR1.15bn,
the largest export to Germany is parts of seats other than medical and dental furniture. This is also the greatest
imported product from Germany to South Africa. Germany is one of the worlds largest manufacturers and global
exporters of furniture and South Africa also imports from Germany (ZAR489m). Namibia and Botswana are South
Africas second and third largest destination markets valued at ZAR557m and ZAR427m respectively. Seven out
of the top ten destination markets for furniture products are other African countries, with three other European
markets.
China was the leading source market for furniture to South Africa in 2013, valued at ZAR2.88bn, making up 52%
of all South African imports. China is followed by Germany and Thailand valued at ZAR489m and ZAR321m. Five
of the top 10 source markets are Asian markets. The top 5 imported products from China are wooden furniture
(ZAR442m); household chairs upholstered and wooden framed chairs (ZAR397m); metal furniture (ZAR281m);
articles of bedding stuffed or internally fitted (ZAR245m) and parts of seats other than those used for surgery,
elevation, swivelling or reclining (ZAR232m).

11

SOUTH AFRICAS TOP 10 IMPORT MARKETS OF


FURNITURE PRODUCTS, 2013
VALUE
%
RANK
PRODUCT
2013
GROWTH,
(ZARm) 2012-2013

SOUTH AFRICA'S TOP 10 EXPORT MARKETS OF


FURNITURE PRODUCTS, 2013
VALUE
%
RANK
PRODUCT
2013
GROWTH,
(ZARm)
2012-2013
1

Germany

1 151

-14.1%

China

2 883

11.7%

2
3

Namibia

557

Botswana

427

Germany

489

27.0%

Thailand

321

43.8%

Swaziland

223

Italy

212

35.5%

Lesotho

197

Malaysia

189

-2.7%

Zambia

192

1.2%

Poland

170

15.7%

7
8

Spain

170

39.7%

Indonesia

126

-0.9%

Mozambique

166

23.1%

United Kingdom

103

94.1%

Bulgaria

155

-10.6%

United States of America

96

13.3%

10

Zimbabwe

136

7.2%

10

India

94

21.8%

4 259

50.3%

5 578

16.3%

TOTAL EXPORTS

TOTAL IMPORTS

Source: Trademap, 2014

Parts of seats were the leading furniture export from South Africa, valued at ZAR1.739bn, followed by wooden
furniture (ZAR426m) and other seats (ZAR274.5m). Three of the top 10 exports are seats or parts of seats. Mattrass
supports showed strong growth in exports of 659.5% in 2013.
The leading furniture import into South Africa was parts of seats valued at ZAR1.536bn, followed by wooden
furniture (ZAR797.8m) and seats with wooden frames (ZAR475.6m). There has been high growth in the import of
articles of bedding in 2013 with 53% growth, other furniture parts have also grown by 52.4% in 2013.
SOUTH AFRICA'S TOP 10 EXPORTS OF FURNITURE PRODUCTS,
2013
VALUE
%
RANK
PRODUCT
2013
GROWTH
(ZARm)
2012-2013
Parts of seats other than those used
1
for surgery, elevation, swivelling or
1 739.7
-4.6%
reclining
2
3
4

Furniture, wooden, nes


Seats nes, other than those used for
surgery, elevation, swivelling or
reclining
Articles of bedding/furnishing, nes,
stuffed or internally fitted

SOUTH AFRICA'S TOP 10 IMPORTS OF FURNITURE PRODUCTS, 12


2013
VALUE
%
RANK
PRODUCT
2013
GROWTH
(ZARm)
2012-2013
Parts of seats other than those used
1
for surgery, elevation, swivelling or
1 536.6
24.8%
reclining

426.0

172.6%

Furniture, wooden, nes

797.8

0.6%

274.5

54.7%

Seats with wooden frames,


upholstered nes

475.6

8.5%

222.6

272.0%

Furniture, metal, nes

421.8

6.8%

Furniture, metal, nes

204.8

61.4%

Articles of bedding/furnishing, nes,


stuffed or internally fitted

413.2

53.2%

Mattress supports

202.7

659.5%

Bedroom furniture, wooden, nes

299.6

3.9%

235.7

19.3%

208.8

-5.6%

175.4

45.5%

175.2

52.4%

5 578.1

16.3%

Bedroom furniture, wooden, nes

194.2

310.4%

Seats with wooden frames,


upholstered nes

164.0

98.8%

Office furniture, wooden, nes

157.6

134.0%

10

Mattresses fitted w
springs/stuffed/internally fitted w/any
material

119.5

422.5%

10

4 258.9

50.3%

TOTAL EXPORTS
Source: Trademap, 2014

Seats with metal frames, nes, other


than those used for surgery,
elevation, swivelling or reclining
Seats nes, other than those used for
surgery, elevation, swivelling or
reclining
Swivel seats & variable height
adjustment other than those used for
surgery and veterinary
Furniture parts nes

TOTAL IMPORTS

Medium-term export and import growth can be seen in the figures below. The top growing export product from
2009 to 2013 was mattresses with springs (60.4%) followed by stuffed articles of bedding or furnishings (51.2%).
High medium term growth of above 50% can mainly be seen in bedroom furniture, specifically related to bedding.

SOUTH AFRICAN MEDIUM-TERM EXPORT GROWTH, 2009-2013


Parts of seats other than those of heading No 94.02

-7,6%

Seats nes, other than those of heading No 94.02

7,7%

Office furniture, wooden, nes

19,2%

Furniture, metal, nes

28,0%

Bedroom furniture, wooden, nes

31,1%

Furniture, wooden, nes

34,2%

Seats with wooden frames,upholstered nes

34,3%

Articles of bedding/furnishing, nes, stuffed or internally fitted

51,2%

Mattresses fittd w springs/stuffd/internally fittd w/any material

60,4%

-20% -10%

0%

10%

20%

30%

40%

50%

60%

70%

Source: Trademap, 2014


*seats with heading number 94.02 are those used in surgery, dental practice or veterinary (for example, operating tables,
examination tables, hospital beds with mechanical fittings, dentists' chairs); barbers' chairs and similar chairs, having rotating as
well as both reclining and elevating movements; parts of the foregoing articles

The top growing import product from 2009 to 2013 was swivel seats (46.8%) followed by furniture parts (27.8%)
and upholstered seats with wooden frames (27.4%). Most of the growth in imports above 20% was found in seating.

13

SOUTH AFRICAN MEDIUM-TERM IMPORT GROWTH, 2009-2013

Parts of seats other than those of heading No 94.02

10,8%

Bedroom furniture, wooden, nes

13,8%

Furniture, wooden, nes

14,1%

Articles of bedding/furnishing, nes, stuffed or internally fitted

14,4%

Seats nes, other than those of heading No 94.02

14,5%

Furniture, metal, nes

14,7%

Seats with metal frames, nes, other than those of heading No


94.02

26,4%

Seats with wooden frames,upholstered nes

27,4%

Furniture parts nes

27,8%

Swivel seats&variable height adjustment oth than those of


headg 94.02

46,8%
0%

Source: Trademap, 2014

5%

10% 15% 20% 25% 30% 35% 40% 45% 50%

2.3

Western Cape Furniture Trade

The Western Capes trade of furniture products has been dominated by imports over the past decade, with exports
rising to ZAR282.34m in 2012. Western Capes imports have increased by 16.86% from 2011 to 2012 to reach
ZAR1.02bn in 2012. The import of furniture into the Western Cape is likely to increase into the future at around 6%
per annum.

WESTERN CAPE TRADE IN FURNITURE, 2004-2012


1200
1000
800
600

Value (ZARm)

400
200
0
-200
-400
-600
-800
-1000

Exports (ZARm)

2004
186,17

2005
185,71

2006
217,35

2007
305,16

2008
240,34

2009
181,49

Imports (ZARm)

208,71

361,35

579,03

707,04

817,19

743,94

Trade Balance (ZARm)

-22,55

-175,64

-361,68

-401,88

-576,85

-562,46

2010
227,33

2011
270,32

2012
282,34

765,06

874,07

1021,46

-537,73

-603,75

-739,12

Source: Quantec, 2014

Germany was the leading destination market for furniture from the Western Cape in 2012, with a value of ZAR70m.
Angola and the United Kingdom ranked second and third valued at ZAR38m and ZAR33m respectively. Six of the
top 10 destination markets are fellow African markets.

14

China was the leading source market for furniture imports into the Western Cape in 2012, with a value of ZAR672m.
Indonesia and Pakistan ranked second and third valued at ZAR45m and ZAR43m respectively. Six of the top 10
source countries are Asian markets.
TOP 10 DESTINATION COUNTRIES FOR WESTERN CAPES
FURNITURE EXPORTS, 2012
VALUE
%
RANK
COUNTRY
2012
GROWTH
(ZARm)
2011-2012

TOP 10 SOURCE COUNTRIES OF WESTERN CAPES


FURNITURE IMPORTS, 2012
VALUE
%
RANK
COUNTRY
2012
GROWTH
(ZARm)
2011-2012

Germany

70.14

6.1

China

672.28

23

Angola

38.48

35.5

Indonesia

45.00

36

United Kingdom

33.07

27.9

Pakistan

43.49

80

Mozambique

22.28

13.4

Malaysia

41.84

22

Zambia

14.46

7.5

Italy

36.62

17

Zimbabwe

13.84

10.2

Germany

28.53

United States

12.86

11.0

India

27.71

29

Mauritius

11.00

114.9

Vietnam

22.88

25

United Republic of Tanzania

9.02

28.1

United States

18.02

19

10

Ghana

8.68

23.2

10

Turkey

13.58

22

TOTAL EXPORTS

282.34

6.6

TOTAL IMPORTS

1021.46

18

Source: Quantec, 2014

Parts of seats export product from the Western Cape, valued at ZAR107m, followed by wooden furniture (ZAR38m)
and metal furniture (ZAR30m). Total exports from the Western Cape grew by 4.4% in 2012. In 2012, plastic furniture
and wooden office furniture showed strong growth of 133.1% and 89% respectively.
The leading furniture import product into the Western Cape was wooden furniture valued at ZAR175m, followed by
upholstered wooden seats (ZAR126m). The highest import growth was found in seats with metal frames and
furniture parts, growing at 58.8% and 42.8% respectively.
WESTERN CAPE'S TOP 10 EXPORTS OF FURNITURE PRODUCTS,
2012
VALUE
%
RANK
PRODUCT
2012
GROWTH
(ZARm)
2011-2012
Parts of seats other than those used for
1
107
-18.1%
surgery, elevation, swivelling or reclining

WESTERN CAPE'S TOP 10 IMPORTS OF FURNITURE PRODUCTS,


2012
VALUE
%
RANK
PRODUCT
2012
GROWTH
(ZARm)
2011-2012
1

Furniture, wooden, nes

175.42

0.2%

33.6%

Seats with wooden frames,


upholstered nes

126.79

38.6%

Furniture, wooden, nes

38

Furniture, metal, nes

30

5.0%

Articles of bedding nes

104.34

20.0%

Furniture, plastic, nes

21

133.1%

Furniture, metal, nes

101.12

-2.8%

Furniture parts nes

13

-40.4%

Seats nes

88.52

37.6%

Seats with wooden frames, upholstered


nes

12

29.1%

Bedroom furniture, wooden, nes

85.40

4.7%

Articles of bedding nes

12

61.4%

Seats with metal frames, nes

56.75

28.2%

34.30

58.8%

34.05

42.8%

Bedroom furniture, wooden, nes

Office furniture, wooden, nes

10

Other

TOTAL EXPORTS
Source: Quantec, 2014

10

31.4%

Seats with metal frames,


upholstered nes

89.0%

Furniture parts nes

59.3%

10

Kitchen furniture, wooden, nes

282

4.4%

TOTAL IMPORTS

33.75

4.9%

1 021.46

16.9%

15

2.4. Trade Trends in Furniture sub-sectors in the Western Cape


Parts of seats, wooden furniture and metal furniture are the top three furniture sub-sectors that are exported from
the Western Cape. The Western Cape is a net exporter of parts of seats and a net importer of wooden and metal
furniture.
The graph below shows trade trends in the Western Cape for parts of seats. Exports for parts of seats have
fluctuated vastly, with a moving average trend-line experiencing two peaks and two dips in the 8 year period.
Exports of these products have experienced a CAGR of 7% over the past 8 years, growing from around ZAR60m
in 2004 to ZAR106m in 2012. Import values have had a larger CAGR of 22% over the 8 year period, however their
growth has been from a low base of ZAR3.59m in 2004 to around ZAR18m in 2012. There has not been the same
degree of volatility in the imports as there has been in the exports.

WESTERN CAPE TRADE OF PARTS OF SEATS, 2004-2012


250

Value (ZARm)

200

150

100

50

16

Exports (ZARm)

2004
59,63

2005
59,21

2006
126,05

2007
200,68

2008
115,44

2009
65,70

2010
103,98

2011
130,52

2012
106,88

Imports(ZARm)

3,56

12,80

21,76

30,90

31,44

24,38

26,53

13,29

17,86

Source: Quantec, 2014

The graph below shows that the import value of metal furniture in the Western Cape increased significantly from
2004 (ZAR19m) to 2012 (ZAR101m), with a compound annual growth rate (CAGR) of around 24%. In 2008, around
the financial crisis, there was a decrease in imports until 2010, with a large increase in 2011 of around ZAR40m to
maintain the clear upward trend seen in the moving average trendline. These increases are due to the increasing
competitive advantage of emerging markets such as China. In 2004, 61% of all metal furniture was imported from
China and by 2012 this had increased to 72%.
The Western Capes exports of metal furniture has a CAGR of only 1.6% over the 8 year period, increasing by only
ZAR3.5m. In 2004 and 2005 the Western Cape was a net exporter of metal furniture, however, into 2005 there was
a stark divergence where exports decreased and imports increased by around ZAR10m each. Thereafter exports
have not recovered.

WESTERN CAPE TRADE OF METAL FURNITURE, 2004-2012


120

Value (ZARm)

100
80
60
40
20
0
Exports (ZARm)

2004
26,43

2005
34,99

2006
22,51

2007
18,49

2008
16,86

2009
17,54

2010
19,98

2011
28,56

2012
30,00

Imports(ZARm)

18,58

27,54

41,33

68,09

88,10

67,75

64,77

104,05

101,12

Source: Quantec, 2014

The graph below shows that the import value of wooden furniture in the Western Cape. This does not include
bedroom, office or kitchen furniture. All categories of wooden furniture are imported mainly from Asia, apart from
kitchen furniture which is imported mainly from Europe.
This category increased significantly from 2004 (ZAR49m) to 2012 (ZAR178m), with a compound annual growth
rate (CAGR) of around 15%. In 2010, after the financial crisis, there was a decrease in imports which quickly
recovered to ZAR175m in 2011. These increases are due to the increasing competitive advantage of emerging
markets such as China. In 2004, 27% of all wooden furniture was imported from China and by 2012 this had
increased to 46%. The Western Capes exports of wooden furniture has a CAGR of only 3.5% over the 9 year
period, increasing by only ZAR314m.

WESTERN CAPE TRADE OF WOODEN FURNITURE, 204-2013

200
180

Value (ZARm)

160
140
120
100
80
60
40
20
0

2004

2005

Exports (ZARm)

36,77

28,48

23,11

24,39

27,29

23,49

26,32

28,23

37,71

50,51

Imports (ZARm)

49,36

89,19

125,67

149,99

174,90

172,98

130,72

175,07

175,42

177,67

Source: Quantec, 2014

2006

2007

2008

2009

2010

2011

2012

2013

17

3.

FDI

3.1

Global FDI into the Furniture Sector

The classification of furniture products can be found in the consumer products industry (72% of global projects),
the wood products industry (15% of projects) and the textile industry (13%). Between January 2003 and December
2013, a total of 1,537 FDI projects were recorded into the furniture sector, equating to a 0.9% share of global FDI.
These projects represent a total capital investment of ZAR365.94bn which is an average investment of
ZAR238.06m per project. During the period, a total of 308,839 jobs were created.

50

200

45

180

40

160

35

140

30

120

25

100

20

80

15

60

10

40

20

0
CAPEX (ZARbn)
Projects

2003
15,7

2004
19,6

2005
21,0

2006
26,3

2007
41,9

2008
45,9

2009
44,7

2010
32,4

2011
32,1

2012
44,2

2013
42,0

74

83

94

119

158

160

169

165

153

175

187

Projects

Value (ZARbn)

GLOBAL FDI INTO FURNITURE, JAN 2003-DEC 2013

Source: FDI Intelligence, 2014

18

The United States was the leading source market in terms of investment projects in the global furniture industry
with 373 investment projects, accounting for 24% of projects and 18% of capex. Sweden and Germany ranked
second and third with 173 projects (11%) and 112 projects (7%). South Africa was the 21st source market for
furniture FDI, with 12 projects in the period and ZAR1.89bn. South Africa is a net investor in the furniture sector.
SOURCE MARKETS FOR FDI IN THE FURNITURE SECTOR, JAN 2003-DEC 2013
RANK

SOURCE MARKETS

%
PROJECTS

PROJECTS

CAPEX
(ZARm)

% CAPEX

JOBS

United States

373

24%

67172.7

18.3

66 962

Sweden

173

11%

80097.5

21.8

51 014

Germany

112

7%

20381.7

5.5

15 242

Italy

99

6%

22276.3

6.1

18 406

Spain

97

6%

29007.3

7.9

20 493

Austria

72

5%

16249.5

4.4

11 531

Denmark

71

5%

24143.6

6.6

17 355

France

68

4%

19928.7

5.4

11 184

United Kingdom

44

3%

5887.1

1.6

5 713

10

China

40

3%

4036.3

1.1

3 823

21

South Africa

12

1%

1896.2

1 483

1545

100%

367420.9

100%

310197

TOTAL
Source: FDI Intelligence, 2014

The United States was also the leading destination market in terms of investment projects, for furniture with 282
investment projects, accounting for 18%. China and Germany rank second and third with 122 (8%) projects and

94 (6%) projects respectively. South Africa ranks 49th in terms of FDI projects with 5 projects in the period, with a
capex value of ZAR649.7m.
DESTINATION MARKETS FOR FDI IN THE FURNITURE SECTOR, DEC 2003-DEC 2013
RANK

DESTINATION MARKETS

PROJECTS

% PROJECTS

CAPEX
(ZARm)

% CAPEX

JOBS

United States

282

18%

51 943.3

14.1

43 270

China

122

8%

35 225.9

9.6

33 262

Germany

94

6%

22 495.3

6.1

10 293

United Kingdom

82

5%

8 441.3

2.3

7 778

India

62

4%

23 774.9

6.5

26 249

France

58

4%

23 225.2

6.3

11 277

Poland

56

4%

17 827.5

4.9

13 449

Spain

45

3%

14 816.1

4.0

9 948

Russia

44

3%

14 919.5

4.1

30 549

10

UAE

41

3%

5 835.0

1.6

6 096

49

South Africa

0%

649.7

4 582

1545

100%

367420.87

100%

310197

TOTAL
Source: FDI Intelligence, 2014

IKEA was the leading global company investing in the furniture sector with 104 projects, followed by Jysk and Zara
Home with 47 projects and 34 projects respectively. The largest investment made by IKEA was valued at
ZAR6.07bn. This investment was to set up 25 retail stores through a wholly owned subsidiary across India. The
second stage retail investment, which is still to come is estimated to be around ZAR9bn.
TOP 10 INVESTING COMPANIES IN THE FURNITURE SECTOR, JAN 2003-DEC 2013
RANK

INVESTING COMPANY

NUMBER OF
PROJECTS

CAPEX (ZARm)

IKEA

104

63 617.4

Jysk

47

14 788.9

Zara Home

34

13 668.8

Swedwood

22

8 647.2

Ethan Allen Interiors

19

4 714.1

Kinnarps

15

770.4

Kika/Leiner Group

15

2 666.6

Euromarket Designs (Crate & Barrel)

14

3 584.2

Conforama

14

7 603.1

10

Porcelanosa

14

3 579.2

1 545

367 420.9

TOTAL
Source: FDI Intelligence, 2014

19

3.2

FDI into the South African Furniture Sector

Between 2003 and 2013, a total of 5 FDI projects were recorded, into the South African furniture sector. These
projects represent a total capital investment of ZAR649.71m which is an average investment of ZAR129.78m per
project. During the period, a total of 4582 jobs were created. Each of the companies below invested in one project
each.
Poltrona Frau invested ZAR300m in March 2012 in Cape Town in a retail project. This Italy-based furniture
manufacturer has opened a store in Cape Town, in the design district of the city, and has opened in collaboration
with architect George Giorgio. This was also the most recent investment into the furniture industry in South Africa.
SOURCE MARKETS FOR FDI IN THE SOUTH AFRICAN FURNITURE SECTOR, JAN 2003-JAN 2014
INVESTING
COMPANY

DATE

SOURCE
COUNTRY

DESTINATION
STATE

INDUSTRY
SECTOR

Mar 2012

Poltrona Frau

Italy

Western Cape

Consumer
Products

Nov 2009

J&C Joel Limited

UK

Gauteng

Textiles

May 2009

Nam Viet Joint


Stock Company
(NAVIFICO)

Vietnam

KwaZulu-Natal

Wood
Products

Jul 2006

Lube

Italy

Not Specified

Consumer
Products

Jan 2003

Zorlu Textile

Turkey

Not Specified

Textiles

SUB-SECTOR
Furniture, homeware &
related products
(Consumer Products)
Furniture, homeware &
related products
(Textiles)
Furniture, homeware &
related products (Wood
Products)
Furniture, homeware &
related products
(Consumer Products)
Furniture, homeware &
related products
(Textiles)

TOTAL

INDUSTRY
ACTIVITY
Retail
Sales,
Marketing &
Support
Manufacturing
Sales,
Marketing &
Support
Manufacturing

VALUE
(ZARm)
300.06

194

14.05

18

101.92

4000

29.76

20

204.17

350

649.96

Source: FDI Intelligence, 2014

3.3

JOBS

South African FDI into the Global Furniture Sector

Between 2003 and 2013, a total of 12 FDI projects were recorded from South Africa into the global furniture sector.
These projects represent a total capital investment of ZAR1.90bn which is an average investment of ZAR157.88m
per project. During the period, a total of 1 483 jobs were created. All of the investments from South Africa were
made from the Gauteng province.
The most recent South African investment was by Abra, a Subsidiary of Steinhoff International Holdings. Abra
invested ZAR341m in the city of Lomza in Poland in November 2012 in a furniture retail project.

458220

SOURCE MARKETS FOR FDI IN THE SOUTH AFRICAN FURNITURE SECTOR, JAN 2003-JAN 2014
INVESTING
COMPANY

DATE

DESTINATION
COUNTRY

Nov 2012

Abra

Poland

May 2009

Freedom Furniture

New Zealand

May 2009
Nov 2008
Aug 2007
Jan 2006
Nov 2004
Nov 2004

Steinhoff International
Holdings
Protect-A-Bed North
America, LLC
Steinhoff International
Holdings
Steinhoff UK
Upholstery
Steinhoff International
Holdings
Steinhoff International
Holdings

UK
United States
Hungary
UK
Russia
Russia

Oct 2003

FurnCity

Botswana

Oct 2003

FurnCity

Zambia

INDUSTRY
SECTOR
Consumer
Products
Consumer
Products
Consumer
Products
Consumer
Products
Wood
Products
Wood
Products
Wood
Products
Wood
Products
Wood
Products
Wood
Products

SUB-SECTOR
Furniture, homeware & related
products (Consumer Products)
Furniture, homeware & related
products (Consumer Products)
Furniture, homeware & related
products (Consumer Products)
Furniture, homeware & related
products (Consumer Products)
Furniture, homeware & related
products (Wood Products)
Furniture, homeware & related
products (Wood Products)
Furniture, homeware & related
products (Wood Products)
Furniture, homeware & related
products (Wood Products)
Furniture, homeware & related
products (Wood Products)
Furniture, homeware & related
products (Wood Products)

INDUSTRY
ACTIVITY

VALUE
(ZARm)

JOBS

Retail

341.39

216

Retail

240.54

177

Retail

142.17

138

Logistics, Distribution
& Transportation

316.59

231

Manufacturing

13.47

Manufacturing

46.29

135

Manufacturing

214.92

85

70.26

11

Retail

128.95

148

Retail

128.95

148

1896.488

1483

Sales, Marketing &


Support

TOTAL
Source: FDI Intelligence, 2014
For more information on this publication and other Wesgro publications please contact research@wesgro.co.za. For more
publications like this visit the Wesgro publications portal on our website at http://wesgro.co.za/publications

21