TURKEY INCREASES ITS SHARE OF GLOBAL FURNITURE

18
08
Fueling economy out of wood:
a tale of the Turkish furniture
industry. Page 04
“We are producing furniture of
European quality standards but
for Asian prices,” says MOSDER
President Nazif Türkoðlu.
The Aydýnlý Group is rapidly
taking a share in Turkey's
vast furniture market shortly
after launching sales.
A SPECIAL SUPPLEMENT ON TURKYE’S FURNITURE INDUSTRY
JULY 24, 2009 WWW.TODAYSZAMAN.COM
TURKEY
INCREASES
ITS SHARE
OF GLOBAL
FURNITURE
EXPORTS
DAVID NEYLAN, ÝSTANBUL
Despite the effects of the
global economic crisis on
the country, Turkey's furniture
exports remain one of the world's
more dynamic export industries.
The Turkish furniture export
industry has not only proven to be
relatively resistant to the significant contractions experienced by
other sectors, but it has also continued to expand its lead in comparison to other top furniture
exporting countries. In the months
and years ahead, the Turkish sector appears poised to expand this
position as Central Asian and
Middle Eastern target countries'
economies make a quicker recovery than other countries and as
Turkish furniture exporters continue to capture an increased
market share in these regions.
CONTINUED ON PAGE 06
CONTENTS03
FURNITURE
JULY 24, 2009
Refurnishing the world
Cities such as Kayseri and Ýnegöl, renowned for their strong furniture industries, did not mean much to foreigners only a decade ago.
However, today, it is very likely for a housewife in Canada to rest on a couch that was manufactured in Ýnegöl or for a manager in
Shanghai to sign papers on a table produced in Kayseri. Students in Damascus sit on chairs made in Turkey while friends in a Paris
café sip on their tea and chat around a Turkish-made coffee table.
A shift similar to one experienced in the textile sector two decades ago is now taking place in the furniture industry. Europeans
are no longer the largest furniture producers of the world as they are gradually shying away from this area, placing more emphasis
on design rather than quantity.
However, even in design, Turkish furniture makers are challenging their European rivals and even surpassing them. The fact
that Germany, Europe's largest economy, is the number one customer of Turkish furniture exporters is an indicator of Turkey's ability to answer the needs of Europe, a notable market focusing on quality and design.
Aside from these positive implications for external markets, the industry also means much to the domestic market. It was among
the three major sectors for which the government opted to introduce tax incentives to boost production and domestic demand, considering its vital role in terms of employment and added value.
Today's Zaman wants to put this burgeoning industry under the spotlight. In the pages that follow, you will find insightful
opinions from the sector's prominent players, analyses about the most recent developments in the industry and a good deal of the
most up-to-date news from a number of major companies in the business.
Owner on Behalf of Feza Gazetecilik A.Þ
Ýbrahim Türkmen
Ali Akbulut
Chief Executive Officer
Ekrem Dumanlý
Editor-in-Chief
Bülent Keneþ
PICTURE: The furniture industry in Turkey started in small workshops and
Editor
has developed into a strong sector which currently includes both large-scale
Ýbrahim Türkmen
factories and workshops, offering high-quality products in a wide range of
styles such as modern, classic, traditional and modular furniture.
Chief Copy Editor
Helen P. Betts
04
Chief Marketing Officer
Yakup Þimþek
EXPANSION:The Turkish furniture export industry
has not only proven to be relatively resistant to the
significant contractions experienced by other sectors,
but it has also continued to expand its lead in comparison
to other top furniture exporting countries.
Advertising Sector Managers
Sabahattin Sürmen
Emel Davarcý
Melike Doðrular
F. Betül Fýndýkoðlu
Responsible Manager and
06
TAX INCENTIVES BOOST SALES: A 10 percent
reduction in value-added tax (KDV) on furniture
and home appliances has had a remarkable effect
on the furniture market in Turkey and cheered
everyone within: producers, stores,
consumers and notably the state.
Representative of the Owner
Ali Odabaþý
10
A SINGLE ROOF: The furniture sector is now
close to establishing a federation of unions, giving
the sector a more powerful voice both in domestic
and foreign markets, a project that has been in the
works for the past few years.
14
OBSTACLES AND GRIPES : Office Furniture
Industrialists' and Businessmen's Association
(OMSÝAD) Chairman Ercan Ata criticized the
government's tax reduction, saying it was not
sufficient to solve the problems of the sector and
was far from meeting expectations.
Today’s Zaman
July 24, 2009
Public Relations Contact Information: +90 212 454 84 54
Publication Type: Periodical,
Daily Headquarters: Today’s Zaman, 34194 Yenibosna,
ISTANBUL. Phone Number:
+90 212 454 1 444 Fax: 0212 454 14 97,
Web Address: http://www.todayszaman.com,
Printed at: Feza Gazetecilik A.Þ. Tesisleri. Advertisement
Phone: +90 212 454 82 47,
Fax: +90 212 454 86 33.
Today's Zaman abides by the rules of press ethics.
26
FOCUS04
JULY 24, 2009
FURNITURE
Fuelýng economy out of wood: a tale
of the Turkýsh furnýture ýndustry
ZEYNEP KALKAVAN ÝSTANBUL
sign has become one of the most important aspects
of furniture, Turkish furniture firms have begun to
employ more designers to develop new styles and
meet the ever-changing tastes of customers. In this
respect, Turkey's strong textile industry, which offers a wide range of colorful fabrics, is a major advantage for Turkish furniture manufacturers to introduce new designs, says the ÝGEME report.
Turkey has an important manufacturing sector
for furniture components, such as metal parts, timber
products and chemical components. As the main furniture sector develops, furniture subsectors are also
improving. The export levels of furniture components
and raw materials have seen an upward trend in the
last 10 years, increasing from $217 million in 1998 to
$1.99 billion in 2008, according to the ÝGEME report.
Turkey's furniture subsectors export to over 160
countries, including Germany, Iran and Russia.
The Turkish furniture industry is currently showing signs of contraction, especially in the world market, due to the ongoing global economic crisis.
According to the “Furniture Sector Report of 2008,”
published by the Furniture Industry Businessmen's
Association (MOBSAD), exports fell to $85 million in
January 2009 compared to $102 million during the
same period last year, creating a roughly 20 percent
drop. Imports also decreased by more than 40 percent during the same period. In the domestic market, on the other hand, the sector is trying to weather the effects of the crisis with the help of reductions
in the value-added tax (KDV). Thanks to these reductions, in the last three months a roughly 35 percent rise was seen in domestic sales figures, reported
Barýþ Görgüç, secretary-general of MOBSAD.
PHOTO
CÝHAN
In recent years, the Turkish furniture industry has become one of the driving
forces behind the Turkish economy.
Thanks to globalization, innovative improvements
and brand marketing strategies, furniture production in Turkey has improved its international reputation and has expanded into new markets.
The furniture industry in Turkey started in small
workshops and has developed into a strong sector
which currently includes both large-scale factories
and workshops, offering high-quality products in a
wide range of styles such as modern, classic, old fashioned and modular furniture. The sector comprises
29,346 manufacturing companies and 32,382 retailers,
according to the 2003 data provided by the Turkish
Statistics Institute (TurkStat). These figures are estimated to be 35,000 and 40,000 in 2008, respectively.
The industry, which is dominated by small enterprises, has only 40 companies with more than 250 employees and 150 companies with more than 100 employees, according to a report from the Turkish Union
of Chambers and Commodity Exchanges (TOBB).
The domestic market volume of the furniture
sector, which has an 8 percent growth rate annually, totaled $7.5 billion in 2008 based on retail
sales prices. Approximately 260,000 employees
are directly involved in furniture production,
while the sector generates roughly 500,000 positions when side industries are taken into account.
According to data provided by the Foreign
Trade Ministry, Turkey's furniture industry has
seen rapid growth in exports over the past 10
years, increasing from $137.5 million in 1999 to
$1.331 billion in 2008, which also accounts for a 30
percent increase over the previous year. Turkey imported $738 million of furniture goods in 2008, an
8 percent increase compared to the previous year,
enabling the sector to be one of the rare sectors in
which Turkey has a positive balance of trade.
At present Turkey is ranked 21st in worldwide
furniture exports, with a 1 percent share in the
world's total furniture exports. Turkish businesses
export to 160 countries; of them the main markets
are Germany, Iraq, France, Iran and Greece.
Imports, on the other hand, come primarily from
China, Germany, Italy, France and Poland.
Geographically, Ýstanbul, Ankara, Ýzmir, Bursa
(Ýnegöl) and Kayseri are the regions leading production in the sector. Ýnegöl is an important production district due to its rich forest areas.
Kayseri, on the other hand, accounts for approximately 50 percent of production in Turkey, even
though it has no forest resources -- essential for
furniture production. The reason behind
Kayseri's dominance of the sector lies in the entrepreneurial spirit of its citizens, says Ercan
Sarýkaya, general secretary of the Kayseri
Chamber of Furniture Manufacturers and
Woodworkers. Currently 11 of Turkey's 20 largest
furniture manufacturers are established in Kayseri.
Investment in new technology has been increasing in the sector to meet international quality standards since 1990, as a report from the Export
Promotion Center of Turkey (ÝGEME) notes. Most of
the companies have already obtained ISO 9000 certification and other required quality certificates. As de-
A furniture exhibition in Kayseri showcases the products of 150 Turkish firms in addition to those of six foreign ones.
ANALYSIS06
JULY 24, 2009
PHOTO
REUTERS, ANDREW WINNING
FURNITURE
A factory worker assembles a wooden chair at a workshop. Turkish companies are fast on the road to becoming one of the leading furniture exporters globally.
Turkey ýncreases ýts share
of global furnýture exports
contýnued from page 1
According to statistics provided by the
General Secretariat of Ýstanbul Exporters
Associations (ÝÝB), Turkey ranks as the 16th
largest exporter of furniture in the world in terms
of revenue, having brought in an impressive
$1.331 billion in 2008. This is a striking figure
given the sector's humble beginnings and given
the fact that in 2003, the sector was barely on the
map with exports totaling a mere $435 million.
In between then and now, the Turkish furniture
sector has grown at an outstanding pace, experiencing an average growth rate of approximately 32 percent per year. Contrast this with other major growth
sectors, such as the automotive sector, the flagship
of Turkey's exports whose annual growth averaged
21.5 percent in the same period, and the dynamism
of the furniture sector becomes all the more clear.
In fact, when compared to the other top 20
furniture exporting countries, Turkey was in the
forefront in terms of growth, averaging an annual growth rate of 29.1 percent last year. The
nearest rival was China, the leading global furniture exporter, which experienced a growth
rate of 21.1 percent during the same period.
Although the crisis has resulted in a considerable drop in exports in 2009 as Turkey's traditional
export markets have been wracked by the recession,
Turkey is poised to increase its market share further.
Not only does the country benefit from a unique geographic position, serving as a bridge between East
and West, but of equal importance, the country's
long history and reputation for producing classic
oriental designs, popular with Turkey's immediate
eastern neighbors, suggests that the country will be
best placed to extend its reach into neighboring
Middle Eastern and Central Asian markets whose
disposable income is increasing at a much more
rapid rate than those of the European markets.
Already, Turkey's exports to Iraq, the second
largest importer of Turkish furniture, has almost
doubled in the last two years, from about $58 million in 2006 to over $104 million in 2008. Iran is also
absorbing increasing amounts of Turkish imports,
moving up on the list from a distant number eight
of the top 10 importing countries, to number four.
And Azerbaijan, a country that was not even ranked
amongst the top export recipients in the furniture
industry in 2006, witnessed a dramatic increase in
imports from Turkey, climbing from just $29 million
in 2007 to $47 million in 2008 and landing itself in
ninth position of Turkey's top 10 export markets.
“These classical designs are absolutely amazing” said Chantelle Oliver, an antique and classi-
cal furniture expert, speaking to Today's Zaman
at Tepe Home in Þiþli. Oliver, who was on a
buying trip in Turkey from North America, said
that Turkey has the best classical eastern-style
furniture: “In North America you can find only
cheap imitation furniture in this style which is
marketed to lower income groups originating
from this region. The affluent bring their furniture with them from Turkey, Iran or wherever.
What little quality there is, is second-hand and
is, for the most part, furniture that is being traded in by those same affluent people who brought
it with them when they immigrated. … The silk
brocades, the gilded wood, it's simply beautiful.”
But it's not only classical styles that Turkish
furniture is known for. An increasing amount of
the furniture that is being exported to countries
such as Germany is now in direct competition
with established producers like the Italians and
Poles for spots in contemporary homes and offices. Turkey's market share is increasing at a
faster pace than those established producers.
It is hoped by many that once economies return
to normal and the smoke clears, Turkey's inroads
into Europe and North America and the gains in
market share that they have gotten over their competitors will hopefully help them to extend this lead.
SECTOR08
JULY 24, 2009
PHOTO
TODAY’S ZAMAN
FURNITURE
AHMET SAÝD KAVURMACI
Pýerre Cardýn targets
the wealthy wýth move
ýnto furnýture
ABDULHAMÝT YILDIZ ÝSTANBUL
The Aydýnlý Group, Pierre Cardin's only authorized distributor in Turkey and also one of
its biggest licensees in the world, is rapidly
taking a share in Turkey's vast furniture market although only a few months have passed since it
launched furniture sales in the domestic market under
the world's third most renowned brand.
Aydýnlý established a partnership with the
Kayseri-based Özkar Group and opened its first
Pierre Cardin Mobilia concept store in Ankara
last year. Although it received several hundred
franchise applications, it turned down many of
them since it was planning to have a maximum
of 25 stores in Turkey. Currently, it has two
stores in Gaziantep and one in Azerbaijan.
Aydýnlý's short-term projection is to open new
furniture stores in Ýzmir, Ýstanbul and Kayseri. The
group is also planning to research the potential of
25 other countries, including Russia, Ukraine and a
number of Central Asian Turkic republics among
others, in two years. Products prices vary from between TL 7,000 and TL 10,000 for general furniture
sets and up to TL 5,000 for children's room sets.
Aydýnlý Group Vice Chairman Ahmet Said
Kavurmacý says his company initially focused
primarily on children's room sets and some basic
furniture groups for household use but that the
scope of the company's production later in-
Aydýnlý Group Vice
Chairman Ahmet Said
Kavurmacý says his company
initially focused primarily on
children's room sets and
some basic furniture groups
for household use but that
the scope of the company’s
production later increased
to cover all major
furniture products
creased to cover all major furniture products.
Kavurmacý Said Aydýnlý has been selling
Pierre Cardin products in the Turkish market for
15 years. Its license agreement initially only covered menswear, but based on its success and
growing mutual trust it expanded to include
ready-to-wear collections for women and children,
too. Later the coverage of the Pierre Cardin license
agreement was extended to encompass home textiles, furniture, accessories and much more.
Aydýnlý has always tried to work with the best
companies in each field to get Pierre Cardin products and designs manufactured for the domestic
market. For example, it chose the Zorlu Group for
home textiles and Royal Halý of Naksan Holding
to manufacture carpets. Mentioning that Pierre
Cardin's nephew himself heads the furniture design team, Kavurmacý explained that the Özkar
Group is an integral part of the process as it is
adds its skills to these designs, rendering them
quality products with a higher added value.
‘We preferred cooperation
instead of a new brand’
Özkar Group board member and General
Manager Fatih Özcan says the partnership with
the Aydýnlý Group on the production of Pierre
Cardin furniture was the product of a two-year effort. "Instead of creating a new brand, we chose
the association with a strong brand to get off the
ground," Özcan said. He also reiterated the intention of keeping the number of stores limited, saying
they are not concerned about being everywhere
and responding to every customer. They would
rather attempt to address wealthy customers who
don't mind paying more to get the best.
The Özkar Group was established in 1974 and
currently has five companies under its roof. Its
annual turnover was over TL 300 million in 2008,
and it has approximately 4,000 employees.
TILIA to welcome customers
to ýts fýrst store ýn Ýstanbul
Savaþ Plastic, a leading firm in
the contract and garden furniture sector, plans to exhibit
the indoor furniture and outdoor furniture it has produced under the
TILIA brand name since 1990 in its
first brick-and-mortar store, to be
opened in Beylikdüzü later this year.
TILIA, expanding its collection
with imported furniture, aims to exhibit its wide product range in the
1,000-square-meter store. It is possible to find both indoor furniture and
outdoor furniture in its wide product
range of chairs, outdoor sets, dining
tables and sun lounges. Aside from
classical furniture, TILIA has put a
new face on interior design, with a
range of color options for its durable,
modern and easy-to-use furniture.
TILIA products, keeping up with
world trends and innovations, always
attract attention. Their Barbados sofa
set is one of TILIA's most popular
products: It is an outdoor furniture
SECTOR09
JULY 24, 2009
FURNITURE
set, attracting attention with its aluminum and plastic frame and rattan
pattern. This sofa set, with several
color options for its cushions, is made
of three single armchairs, two ottomans and a sofa for three people.
TILIA's Flash armchair model is a
product that can be used both indoors
and outdoors. The armchair is foldable, and its fine fabric can be easily
washed. The Kardelen dining table is
another spectacular TILIA product. It
is easy to use this model, made of
synthetic rattan, anywhere thanks to
its foldable structure. TILIA's Teak
table top gives a magic touch to gardens thanks to its appearance, with
modern lines and a soft structure.
Another product in TILIA's 2009 collection is the Hawaii dinner set. This
model features chic synthetic knitting,
and the patterns on the chair backs
brighten the set. Hosting guests is a
pleasure with this spectacular and
colorful dining set. Ýstanbul Today's Zaman
Having expanded its collection with imported furniture, TILIA aims to
exhibit its wide product range in a new 1,000-square-meter store.
FOCUS10
JULY 24, 2009
PHOTO
TODAY’S ZAMANONUR ÇOBAN
FURNITURE
Both customers and dealers were buoyed with the arrival of a 10 percent reduction in value-added tax (KDV) on furniture and home appliances.
KDV reductýon ýn furnýture
leads to huge boom ýn sales
PHOTO
A 10 percent reduction in value-added tax (KDV) on furniture and home appliances has
had a remarkable effect on the furniture market in Turkey and cheered
everyone within: producers, stores,
consumers and notably the state.
Speaking to Today's Zaman, leading figures of the Turkish furniture industry hailed the bold initiative taken by
the government and underlined that
there would be no harm in permanently
applying this reduced tax rate.
The Justice and Development Party
(AK Party) government issued a second
economic package in late March and
announced that KDV rates would be reduced from 18 percent to 8 percent for
three months starting from March 30.
However, as highly positive reactions
kept coming from the industry and since
the state itself has been increasing its tax
revenues even if the rates are dramatically lower than they used to be, the
government decided to extend the reduced KDV period for another three
months. This good news pleased everyone in the sector and prompted them to
ask for an extension since this would
benefit everybody including the state.
“The decision had a highly positive effect on the market, and we saw
that very clearly,” said the chairman
of Ýnegöl Furniture Manufacturers
Union, Hamdi Ýdil. He represents
one of the largest sections of the fur-
CÝHAN
MUSTAFA EDÝB YILMAZ ANKARA
niture industry in Turkey, a position
achieved with the huge leap Ýnegöl, a
medium-sized township in Bursa,
has made in the last 15 years.
Ýdil said they saw the change immediately. “Only 10 days after the decision
was implemented, we had a fair in
Ýnegöl and it turned out to be a great
success, yielding a huge volume of trade
just because of the reduction in KDV.
We are extremely grateful to the decision makers for this initiative,” he explained. Ýdil added that before April,
Ýnegöl was producing 50,000 sets of furniture a month, but for the last three
months their level of production has
reached around 140,000 monthly. “It
has had not only an economic healing
effect but also a social one. Please, just
imagine, people were wasting time on
the streets with no prospect of finding a
proper job. Now the industry is working
at full capacity, and everybody's returning home each day with hope for
a better tomorrow,” stated Ýdil.
Extension common wish
“Look, I am not just saying the initiative
was good, it was literally excellent,”
were the first words of Kemal Gürel,
chairman of the Chamber of Ýstanbul
Furniture Tradesmen, evaluating the
outcome of the government's step.
Complaining, however, that if the purchasing power of consumers were as
strong as it used to be, the impact would
have been much better, Gürel asked for
a more comprehensive approach embracing the demand side of the market
as well. “But first, the steps that have already been taken should be praised because before then this market was going
through a very hard time. I cannot tell
you how many stores and craftsmen
were forced out of the market in the six
months prior to April,” he said.
Agreeing with Gürel, Mustafa Kara,
his counterpart in Ýzmir, the third largest
city in Turkey, said this initiative provided employment for about 10,000 people
countrywide in the furniture industry
alone, which is why, he added, 8 percent should be the permanent KDV
rate. “Everyone is happy now. The sector produced more than three times the
work it was doing before April; the state
is increasing its tax revenues, too. So I
cannot but ask why we should stick
with 18 percent again. It would be
harmful for all of us, and the state is not
immune to that, either,” he indicated.
Association of Turkish Furniture
Manufacturers (MOSDER) Chairman
Nazif Türkoðlu underlined the initiative's impact on employment, especially
while the global financial crisis still
maintains its grip on the country's economy. “The harsh climate of the crisis
caused the loss of 25,000 people's jobs
in the furniture industry alone. With the
government's initiative 10,000 of them
were brought back on track again. If this
reduction continues until the beginning
of 2010, the other 15,000 will also be
able to return to their jobs, too. We
can certainly beat the economic turmoil within this industry then.”
The government may well listen to
this widespread appeal and take the
necessary measures to continue the
honeymoon period, not only in the furniture industry but also in other sectors
to fight and ultimately beat the economic crisis, which has had such a devastating effect on the real economy.
Nevertheless, in the furniture market
there are still three more months to take
advantage of the reduced-KDV period.
With our contemporary designs, we introduced
thousands of people to comfort and happiness in 59 countries.
We wait for you to come this world.
'IPEP9QYV'EH2S8SVFEPÓĐ^QMV896/)=4LSRITF\*E\
www.alfemo.com.tr
FEATURE12
JULY 24, 2009
FURNITURE
Weddýng season brýngs smýle
to face of furnýture sector
‘Couples getting married
should act quickly’
Ramazan Tokmak of Çetmen-Konfor Furniture
Sales said his company was offering dining
room sets, sitting room sets and bedroom sets
starting at TL 2,800 and that depending on the
characteristics and quality of these products,
prices went up to TL 3,500 and TL 5,500.
Tokmak also mentioned significant discounts of up to 20-30 percent along with the
tax discounts and up to 40-50 percent on cash
payments. He noted: "Right now we are in the
middle of one of the best months in which to
marry. After this month is over, prices will go
up a bit." He also noted that the end of the tax
discount from the government would affect
prices in the furniture sector.
Sales representative Sude Güleç of Ýstikbal
Furniture said her company had added the government's KDV discount to discounts of between 2040 percent that are already available. She noted,
"When combined, these discounts present a great
advantage for our customers." Güleç also noted
COLLAGE
ABDÜLKERÝM KESKÝN
As part of special discount campaigns
being offered by furniture companies for
couples planning to get married -discounts that come on top of the
value-added tax (KDV) cuts
applied by the government
to this sector -- prices on
three-piece dining room,
sitting room and bedroom
sets have been reduced as
low as TL 2,250.
Oya
Hepönal
of
Difanni Furniture's Izmir
Karabaðlar store told the
Anatolia news agency that
the decision to offer special
prices for couples getting
married came in the wake
of a recent lack of activity in
sales in this sector.
Hepönal said that not
only were prices on threepiece furniture sets currently as low as between TL
2,250 and TL 2,750, but
there were also 10 percent
plus 10 percent discounts
being offered on cash sales.
Hepönal also underscored how advantageous the
current conditions are for
people wishing to buy for the
first time or change their existing furniture. She said: "Our
customers are aware of the current advantages available. For
example, couples who are getting married in September and
October are buying their furniture now and leaving it with us."
Hepönal also pointed to the government-backed tax discounts as playing a role in the general dropping of
prices. "We don't want this tax discount to end
because it has brought action to our sector."
A four-piece white goods
set including an oven,
washing machine,
dishwasher and
refrigerator is being
offered at TL 2,390 as part
of a wedding
campaign currently
that credit card payments are included in these discounts. "When a customer wants to install quality,
well-built furniture in his or her house, it's possible
to do this with around TL 4,000-6,000. This
includes items like bedroom sets and dining room
sets. If the customer prefers more luxurious
items, filling the home with furniture can be
done for between TL 8,000 and TL 10,000."
Güleç noted that sector representatives believe
the current KDV discount will continue in a similar fashion until the period after bayram. "Because
it is really giving not only us, but the people who
work with us and also the customers a great
advantage. We are eagerly awaiting news that the
reduction in KDV will be continued," she said.
White goods sets TL 2,390
Özgür Yalçýnkaya, who works in sales for Alfemo
Furniture, says his company is offering a "wedding
campaign" that boasts three-piece furniture sets
for only TL 2,550.
A four-piece white goods set including an
oven, washing machine, dishwasher and refrigerator is offered at TL 2,390 as part of the wedding campaign currently under way, said
Yalçýnkaya. "The present prices are the lowest
we have seen. I think couples getting married
should act fast because it's not yet clear whether
these tax discounts will last. Also, the price of
raw materials is set to go up soon. The price of
items such as steel and foam is rising, so people
planning on marrying need to act quickly before
the end of July." Ýstanbul Today's Zaman with wires
INTERVIEW14
JULY 24, 2009
FURNITURE
Furnýture sector to unýte
under one roof, form federatýon
ERGÝN HAVA ÝSTANBUL
The furniture sector is now close to establishing a federation of unions, giving the
sector a more powerful voice both in
domestic and foreign markets, a project that has
been in the works for the past few years.
“Representatives from the five unions in the
sector are currently conducting studies to ultimately establish a federation that will shortly
take its final shape,” Furniture Industry
Businessmen's Association (MOBSAD) head
Nuri Gürcan told Today's Zaman.
Evaluating the latest developments in the Turkish
furniture sector, Gürcan said the sector desperately
needs to form a single voice so as to both surmount
difficulties due to the ongoing global financial crisis
and also improve its position in the global arena. He
recalled that the sector's unions had played a major
role in convincing the government to implement a
value-added tax (KDV) cut. “If we had not taken our
chances and met with government officials, it could
have taken longer for the incentives to be introduced,” he said, adding that they had also made an
extra effort to maintain confidence in the market.
“The Turkish furniture market has achieved
considerable growth within the past five years and
has attained such success in a short period with the
help of all its sector representatives. … It is the only
sector with no foreign trade deficit, and it reached
$1.5 billion in exports last year,” Gürcan emphasized as he drew an optimistic picture of the sector,
saying factories have started working again and
many people are returning to their jobs.
“The adverse impacts of the ongoing global
financial crisis on the Turkish furniture sector were
relatively few,” he noted, adding, however, that the
sector had not been completely immune to the
destructive waves of the crisis. The major problem
that had emerged amid the crisis was unemployment
because a large amount of people have lost their jobs
in the furniture sector. In particular, large companies
found a solution in dismissing employees and
then cutting production, Gürcan continued, noting that small and medium-sized enterprises
(SMEs) had sustained only slight damage when
compared to the “big players” in the sector.
One prominent factor that Gürcan stressed
was that growth in the furniture sector depends
one way or another on the real estate sector.
“Developments in both sectors affect one another directly. The more the number of new apartments increases, the more demand for new furniture jumps to trigger growth,” he said.
According to Gürcan, another key factor that
affected the furniture sector was the declining number of newly established businesses. “When you look
at the sector, it can clearly be seen that office furniture
manufacturers and dealers are in serious trouble.
Their orders have shrunk considerably following the
emergence of the crisis, and many had no choice but
to close down workshops or switch to other types of
furniture manufacturing,” he said. There will be a
slight increase in sales, but numbers are not expected
to skyrocket following the latest extension in tax
incentives, he stated, adding: “All in all, the furniture
sector is slowly surmounting the difficulties. The
bleak atmosphere that had prevailed for the past few
months has now dispersed.” Gürcan said furniture
Representatives from five furniture sector unions are currently working to establish a federation
to address the sector's problems, MOBSAD head Nuri Gürcan said.
Evaluating the latest
developments in the
Turkish furniture sector,
Gürcan said the sector desperately needs a united
voice in order to overcome
difficulties caused by the
ongoing global financial
crisis and to improve its
standing in the global arena
sector representatives expect the government to
make the KDV discount permanent and specify a
fixed rate of 8 percent. “Also, the KDV on raw materials is still 18 percent, a fact that puts a considerable
burden on manufacturers, and it should be reduced,”
he continued, noting that it would be a wise move for
the government to take care of such problems, particularly in solving unregistered economic activity in the
sector. “People will be encouraged to register in tax
offices; hence, the furniture sector will get a boost,
given the chance,” he explained. The latest official figures show there are 65,000 manufacturers and
250,000 workers in the Turkish furniture sector; however, the real figures concerning the unregistered
activity in the sector still remain a mystery.
With regard to the competitive power of the
Turkish furniture sector in the global arena, a very
major problem that Gürcan underlined was the lack
of effective promotion. “We have conveyed our concerns to the government on this issue. Turkish furniture is only represented by big firms, which only represent Turkey abroad in international fairs. More
Turkish firms, large and small, should take part in
such fairs, which is the only way we can diversify our
products.” Underlining that MOBSAD plans to take
its members to as many fairs abroad as possible, the
union head said there are fairs in Iraq, Syria and
Greece on their list within the next few months.
Gürcan said the current crisis atmosphere has
created new investment opportunities for the sector
and they are looking to benefit from this. “We are
planning to open stores in four big shopping malls
across Turkey. MOBSAD has been conducting market research on this and has seen that there is a
demand,” he said, noting that the member manufacturers' products will be sold in these malls, which will
cover an area of more than 5,000 square meters. He
said they expected to introduce a trademark as part of
this project. Gürcan said the very first malls will be
opened in Ankara and Gaziantep; Antalya and Ýzmir
will follow later, and the last will be in Ýstanbul.
On the issue of problems businesses face in
obtaining bank loans, he said SMEs in particular
have had difficulties. “We can see such problems
among our members, and the government has
done little here. There is a lack of confidence in
the market, and banks are reluctant to extend
loans to certain firms whose financial structure
has been battered by the crisis,” he said.
The head of MOBSAD also called on authorities
to lend an ear to the sector's demand to establish a
free trade zone in Ýstanbul. “We urgently need a free
trade zone. We have conveyed our demands to the
government and are tired of repeating ourselves,
but we need to protect furniture craftsmanship;
otherwise it will completely disappear,” he said.
PHOTO
TODAY’S ZAMAN
Ýstikbal’s new ‘Sýmply You’
collectýon: Made especýally for you
Ýstikbal, whose distinctive concepts leave a definitive mark every year on the furniture sector,
presents its 2009 “Simply You” collection, with
designs that can be shaped to fit every taste. The simple
but chic furniture highlighted in the “Simply You” collection make home life ever more pleasurable, with
pieces from the Vera, Monaco, Delta, Karel Product
Group, Diva Bedroom Set, and Moda Baza lines.
The classically stylish “Simply You” calls out
to those ready to embrace a new decorative style
and reflect their innovativeness in home life. You
feel the elegance of this collection in even its
smallest, finest details. This is a collection that
values design as well as functionality, giving users
the chance to create whole new design concepts
of their own with different product groups.
For those who want to make room for change in
their lives, the first concept of this new collection circulates around the harmonious lines and colors of the
Conrad salon set. With the sparkle and shine of its
stones, striking fabrics and the stitching and fine detailing on the piping, the Conrad salon set is a wonderful
example of the pleasure of careful hand workmanship.
The sheer comfort and style of this sitting room furniture design attract the eye. Also at the forefront of chic
SECTOR15
JULY 24, 2009
FURNITURE
mixed with functionality are the Vera dining room and
bedroom sets, which bring innovation, comfort and chic
to every corner of your home. The Vera dining room set
combines wood and leather for a memorable and striking look for mealtimes, while the Vera bedroom set introduces aesthetics and comfort on new levels, while al-
so including many details to simply make life easier.
The new “Simply You” collection awaits those
interested in the latest apex of home decoration
and the stunning simplicity and functionality that
furniture can provide at the nearly 1,000 Ýstikbal
stores throughout Turkey. Ýstanbul Today's Zaman
SECTOR16
JULY 24, 2009
FURNITURE
TODAY’S ZAMAN
‘We are contýnuýng to grow ýn
2009 by enterýng new markets’
Mehmet Akkaþ, deputy chairman of the board of directors at
Serhat Furniture, a well-known
Turkish furniture firm that manufactures
its products in the Kayseri Organized
Industrial Zone, has stated that they
have discovered new markets by being
flexible and active during the ongoing
global economic crisis. Speaking to
Today's Zaman, Akkaþ said, “We were
not affected adversely by the economic
crisis; on the contrary, we continued to
grow.” He added that taking different
cultures into consideration made it very
easy for them to find new markets.
Emphasizing that it is necessary to
find alternatives to the European market, which has contracted to a great extent because of the economic crisis,
Akkaþ said untouched African markets
may be an important alternative to the
European market. Describing the fact
that products consumed in African
countries are similar to products consumed in Turkey as an advantage,
PHOTO
MUSA ÖZYÜREK KAYSERÝ
Mehmet Akkaþ, deputy chairman of Serhat Furniture's board of directors, says his
firm has not been affected negatively by the crisis, on the contrary, continued to grow.
Akkaþ said firms making use of this advantage will be more successful in attaining their objectives. Stating that
Africa is underdeveloped economically
and technologically, Akkaþ said,
“Furniture producers especially will successfully operate in these countries
thanks to the experience and technological knowledge acquired in Europe.”
He argued that outmoded designs
and a shortage of qualified staff are the
leading problems of the furniture sector.
Underlining that firms that manufacture
imitation products and evade paying
taxes undermine firms that operate
legally, Akkaþ said: “Well-known firms
in this sector employ qualified staff and
establish R&D [research and development] units in order to design new
products. On the other hand, blackmarket firms imitate these products
without making an effort, undermining
the established firms.”
Stating that the furniture sector in
Turkey has gained momentum with its
quality and design in recent years,
Akkaþ said, “Turkey began exporting
furniture 10 years ago and is nowadays
competing with furniture giant Italy.”
Underlining that furniture sector
plays an integral role in the in the economy of both Kayseri and Turkey as a
whole, Akkaþ said the sector has not received the necessary support from local
authorities, who provide support to encourage investment in certain sectors in
a region. Noting that 20 percent of employees in Kayseri are employed in the
furniture sector, Akkaþ stated: “The furniture sector was only a cottage industry in the past, but now it is a huge sector. We have been deprived of support
from local authorities. There is no
building complex for furniture producers. We should solve such problems
with the efforts of local authorities and
NGOs that are involved in these issues. Otherwise, the success of this
city, which has a great potential in
world furniture production, will be ignored and prevented from growing.”
INTERVIEW18
JULY 24, 2009
FURNITURE
Turkýsh furnýture: European
qualýty for Asýan prýces
PHOTO
Despite the damage caused by the ongoing financial crisis, entrepreneurs in the
Turkish furniture sector have sought to
utilize the sectors unique assets, such as its quality, geographical advantages and low labor costs,
to increase furniture exports.
“We are producing furniture of European quality standards but for Asian prices and yet we struggle to expand our place in world markets,” said
Nazif Türkoðlu, head of the Turkish Furniture
Manufacturers' Association (MOSDER) in a phone
interview with Today's Zaman.
MOSDER was founded in 2001 with the aim of
pursuing the interests of furniture manufacturers and
developing the furniture sector by promoting products
to potential customers and creating strategies to
improve the quality of products. The association comprises 30 leading companies in the furniture sector,
including Ýstikbal, Doðtaþ, Yataþ, Kilim and Ýpek.
The association has been working on many
important projects that will certainly contribute to positive developments in the furniture sector. Establishing
fairs, organizing design competitions among university students and visiting foreign countries to expand
Turkey's furniture exports are three of the important
activities MOSDER has undertaken.
Having underlined the Turkish furniture sector's
high export potential, Türkoðlu said MOSDER has
taken steps to increase the number of countries
Turkish companies export furniture to by going
abroad to introduce and promote Turkish products,
working in cooperation with the Foreign
Economic Relations Board (DEÝK) and
the Turkish Exporters' Assembly (TÝM).
Working to promote the furniture sector abroad, MOSDER paid its first visit
to Greece because of the proximity of
the two countries, allowing for easy
and economical furniture transportation. Türkoðlu emphasized the advantages Turkish entrepreneurs can reap
from doing business in Greece and said
they aim have a significant place in the
Greek furniture market in the near future.
After visiting Greece, the MOSDER
council, made up of representatives of 20 firms,
flew to India to promote Turkish products and establish trade deals with Indian firms. Türkoðlu stated
that they met with Indian businessmen in hotels and
introduced them to Turkish products by showing
them examples of Turkish furniture, which they had
brought with them. “We were welcomed in both of
the countries we visited, but noticed that investors
were not well informed about Turkish furniture. I
believe that if an effective marketing strategy is pursued, nobody can stop a boost in the Turkish furniture sector.” He added that MOSDER representatives would continue their international efforts by
paying a similar visit to South Africa in August.
When he was asked to analyze the positive and
negative aspects of the Turkish furniture industry
when compared to the international arena, he highlighted two factors of the Turkish industry -- quality
and labor costs. “Since the furniture sector is a laborintensive sector, our costs are strictly dependent on
labor costs. In European countries, due to strong labor
rights, the working hours are shorter, but the wages
are comparatively higher and there are also high
TODAY’S ZAMAN
MÝNHAC ÇELÝK ÝSTANBUL
Nazif Türkoðlu, head of the Turkish Furniture Manufacturers' Association, says Turkey is eyeing a better standing in the global furniture arena, producing furniture of European quality standards but selling at Asian prices.
social security costs in these countries. In Turkey,
labor costs are not as high as in Europe. The lower
costs create a remarkable advantage when competing
in the European market,” Türkoðlu said, adding that
whereas Turkish furniture manufacturers can profit in
Europe, they have faced some difficulties in Asian
markets, stemming largely from China, which has
one of the lowest labor costs in the world. However,
Türkoðlu drew attention to the poor quality of
Chinese products, which do not generate consumer
loyalty, unlike Turkish products.
For five years, MOSDER has organized a furniture fair in Ýstanbul. The fair is considered a very
effective method of attracting attention to the sector
and boosting the trade relations of Turkish furniture
companies, both within the country and in foreign
countries. The last fair, which was visited by more
than 80,000 people, was deemed as successful as the
world-famous Cologne Furniture Fair and better
than the exhibition in Paris. The sixth fair will take
place on Feb. 2, 2010, at the Ýstanbul World Trade
Center. “The fair in Ýstanbul has provided an opportunity to create business contacts both within the
domestic sector and with foreign investors. There
were more than 10,000 foreign visitors at the last one.
I expect the number of foreign participants will
increase in coming years,” said Türkoðlu.
Furthermore, MOSDER is very interested in
education and provides information about the sector to university students studying in related departments. Every year the association holds a design
competition for university students. Noting that the
association aims to raise the design quality of furniture in Turkey and lead to awareness of the furniture
sector, Türkoðlu stated, “With these contests, we
attempt to help students develop their creativity and
discover their talent, from which the furniture
industry will benefit.” He added that the students
who win the competition are sent to fairs abroad to
experience being in an international arena and to
get a closer look at other furniture producers.
Discussing the problems of sector and the effects
of the ongoing financial crisis, Türkoðlu stated that the
big furniture companies have not been badly damaged
by the crisis, but new investments have been delayed
in general due to the uncertainty in the markets.
Drawing attention to transportation problems, which
Türkoðlu considered to be one of the biggest obstacles
to exporting Turkish furniture, he thanked the government for its support of furniture investors, especially in simplifying legal procedures and providing
financial backing in their travels to foreign countries.
COLLECTION
NEW
JULY 24, 2009
Condýtýons to ýmprove
ýn last quarter of 2009
Ýpek Furniture owner and Chairman Saffet Aslan thinks the current uncertainty in markets, stemming
from the ongoing global financial crisis, has been prolonged because of international financial centers’
desire to make large profits. He argues that the bleak outlook will be dispersed by the end of the year
The global financial crisis is continuing because international finance centers are still trying to make
huge profits, Ýpek Furniture owner and Chairman
Saffet Aslan has said, adding that financial centers will overcome this desire toward the end of the year, allowing the
economy to improve in the final quarter of 2009. Ýpek
Furniture first entered the furniture market with the production of inner-spring couches in Kayseri 18 years ago. Today
it manufactures more than 1,000 items of furniture and exports to almost 30 countries. Ýpek Furniture owner Aslan
spoke to Today's Zaman about the sector and the economy.
Noting that the global financial crisis has had an effect
on the entire world, including Turkey, Aslan said sectors
that manufacture consumer goods have been more resilient
to market contractions. He pointed out that the crisis had
been prolonged because international financial centers
wanted to maximize their profits from interest. “It is the desire to get a LIBOR [London Interbank Offered Rate] plus 6
or 7 percent interest rate instead of a LIBOR plus 0.25 percent interest rate that caused this. They need to forego this
desire. Obviously it cannot continue like this forever. If the
markets collapse, that money will have no value,” he said.
He also shared his views on the government's valueadded tax (KDV) cuts for some sectors. Noting that the incentives had a positive effect on the market, Aslan said
there had been positive developments since the introduction of the tax cut and in order to sustain these developments, the government would need to introduce additional
stimulus packages. He argued that the government would
be able to compensate for its loss of tax income if consumption increased. “The discount appealed to consumers. We
had already been selling our goods at the lowest price possible. But this discount made it more appealing,” he added.
Noting that the tax cuts had encouraged people to use
their rainy-day savings, Aslan said this would have a butterfly
effect and would eventually generate positive results for the entire economy. He explained that the only way companies could
survive the contraction in the market was by having a good organizational plan. “If we look at the crisis from the perspective
of entrepreneurs, this time the crisis is much harder. But we
must not be crushed by it. We have to keep our efforts alive and
discuss what additional steps we can take to survive,” he said,
expressing his opinion that complaining isn't the solution. He
said the crisis could be turned into an advantage if research and
development projects are launched, if innovative research is
conducted and if companies are restructured to be more productive. These steps will not only bring companies back to life
but allow them to overcome the effects of the crisis more easily.
“The focus should be on outward-looking efforts. New markets should be sought. We must find new customer countries and regions,” he said. Noting
that Ýpek Furniture had set new targets during the crisis such as expanding into new
markets, he said that in addition to Europe,
they are preparing to export their goods to
North Africa, Russia and the Middle East.
“We have taken three regions in particular
onto our agenda. We want to enter the market
in North Africa, Iran, Iraq, Russia, Kazakhstan
and Uzbekistan. We want to export semi-finished goods from a Russian-based store to those
markets and do the assembly there,” he said.
TODAY’S ZAMAN
FATMA BETÜL FINDIKOÐLU ÝSTANBUL
PHOTO
SECTOR20
FURNITURE
Noting that government incentives have had a positive effect on the market, Aslan said
recent tax cuts encouraged people to use their rainy-day savings.
SECTOR22
JULY 24, 2009
PHOTO
TODAY’S ZAMAN
FURNITURE
Having increased its exports by 40 percent last year despite the global financial crisis, Donat Mobilya expects to see its exports increase by another 35 percent this year.
Desýgnýng for European
market, Donat Mobilya ýncreases
exports by 40 percent
ZÝYA YILDIRIM BURSA
Donat Mobilya, which received an EU Quality
Award as well as the Ýstanbul Exporters Union's
(ÝÝB) 2008 Export Award, increased its exports by
40 percent last year despite the global financial crisis.
The company aims to see its exports increase by 35 percent this year. Company directors explain their secret thusly:
"Our success abroad is hidden in our strategy of entering
into different countries' markets with different products. We
design and produce according to the expectations, styles
and price levels expected by that country's customers."
Donat Mobilya is an Ýnegöl-based company that refuses to make concessions on its growth goals in spite of
global financial turbulence. With $3.3 million in exports
in 2008, Donat Mobilya won the ÝÝB's 2008 Export
Award. The company also won an EU Quality Award at
the 2009 International EU Quality Summit.
In early June, Donat Mobilya offered members of the
press a tour of its factory in Ýnegöl, where officials explained how their firm has continued to grow despite the
ongoing crisis. Assistant General Manager Abdullah
Boztepe described his company's strategy, saying: "We
did not experience any decline in 2008, despite the fact
that many EU countries were badly affected. Last year,
we achieved exports on the level of $3.3 million. We
have increased the $1.2 million in exports we enjoyed
during the first five months of 2008 to $1.9 million in exports during the first five months of 2009. So in fact, despite the global crisis, we have seen our exports grow by
58.3 percent in the first six months of this year. We expect our export figures by the end of this year to be 38
percent higher than last year, around $4.5 million."
Donat Mobilya
General Manager
Irfan Aydýnlý said they
expect to see a 20
percent increase in
growth volume
compared to
last year.
Boztepe underscored the strong ties the company
maintained with foreign countries as being essential to export success, noting: "We have established important trade
ties and sales points in Belgium, Germany, France, the
Central Asian republics, the Balkans, Saudi Arabia and
Middle Eastern countries such as Iran. In fact, we have
opened up a 6,000-square-meter storefront in Tehran
through distributor ties we have in Iran. And in Belgium,
we've formed a partnership with a marketing firm. Thanks
to this, we are aiming to form even stronger ties throughout Europe and grow within the European market."
General Manager Irfan Aydýnlý noted that their factory
size had grown in parallel with general sales growth, explaining: "While our production area in Inegöl's Yenice
was 11,000 square meters in 2005, we increased this size
to 28,000 square meters in 2007. The completion of a production area we began in 2008 will mean that this year,
we will possess a total of 70,000 square meters in production area. We are also aiming to increase our number of
employees from the current 360 to up to 500."
Aydýnlý, who said the company aims to see a 20 percent
increase in growth volume compared to last year, stated
that Donat Mobilya makes important contributions to the
Turkish economy through both its employment figures and
its export volume. He noted that while Donat advances
through sustainable, profitable growth, it also brings innovation and solid research and development techniques to
the sector. "Along these lines, we have even designed a
very unique 'remote-control' bedroom set. We have new
products coming out every week. We never stop our research and development efforts. One of the most important reasons for the leaps and bounds we are making is all
our investment in research and development," he said.
SECTOR24
JULY 24, 2009
PHOTOS
TODAY’S ZAMAN
FURNITURE
Bellona showcases contemporary dining and living room displays.
A modern Bellona livingroom set unit is displayed.
Home trends for 2009:
the new Bellona collectýon
Bellona not only brings chic and harmony to every corner of the home this year,
it also puts an end to problems of bringing together harmony in color, style and design
with its latest 2009 collection.
The new product groupings from Bellona
bring about unity in home style and offer customers some very unique designs in the
process. In fact, Bellona calls out to customers
with furniture designs that will transform every
corner of your home, from your living room to
your dining room to your bedroom, into one
harmonious vision of style and chic.
Bellona has been offering aesthetic and functional designs to the furniture sector for the past 12
years, and has gone ahead to design its new 2009
collection based on the themes of "happiness and
harmony." Boasting unique interpretations of the
classic and modern approaches to home design,
the Bellona Retro and Zen designs allow customers
to reflect their own styles and approaches in the
various corners of their home.
The Bellona Retro collection reflects an interpretation of classic design in your home, with
beautiful details that underscore this design approach. In fact, the very nobility and grandeur of
this style is felt in Bellona-decorated dining rooms,
sitting rooms and bedrooms with the Retro line.
The Retro line features a focus in this year's trend
in furniture: rounded, convex lines. It also relies
heavily on another favorite of this year: coppery
colors and tones, which are very popular in furniture. And the Swarovski crystals used to give this
line some sparkle will surely dazzle you!
As for the simplicity and chic of elegance, you
will feel it in Bellona's Zen line, which boasts mod-
ern profiles in their most elegant forms. This style
is reflected in the plain simplicity of white and the
chic of brown that decorate the furniture sets for
bed, dining and sitting rooms. The light and dark
bamboo wood used in Zen bring a certain breezy
freshness to all rooms of the home, while the sitting room set boasts the functionality of pieces that
are able to be used as a bed or a chest for storing
possessions. Some of the more hidden specialties
of the Zen bedroom set are details such as motionsensitive lights on the bed frame, or wavy lines
embellished on the wood of many of the pieces.
So, embrace the maximum approach to home
decor in 2009 with Bellona's Retro and Zen collections, and allow innovation to sweep over you as
your reflect your style in your home. Look for these
products and more at the nearly 800 Bellona stores
throughout Turkey. Ýstanbul Today's Zaman
Eurodecor present new kitchen styles
featuring meticulous craftsmanship
Eurodecor, whose products exceed consumer
expectations in terms of function and aesthetics,
is offering kitchens in a variety of colors and finishes
to those who are looking for something different.
The Carina model, which combines the
warm ambiance of wood with contemporary
lines, is an elegant design featuring meticulous
craftsmanship in wood with enriched natural
cherry cabinet doors. The model comes in three
colors: natural cherry, American cherry and
American walnut. A large, effectively lit shelf and
counter complement the cooking section. The
unit interiors are specifically designed to support
the functions of the cooking area, maximizing the
cabinet space. The island features a sink and deep
drawers and is designed to offer a useful center
section between the kitchen table and work area.
The kitchen also has plain and simple half-size
cabinets, which are perfectly designed without being too high. The units and cabinet doors are designed in the same color and the overall layout is
brought together by a table that serves as the focal
point of the kitchen. Ýstanbul Today's Zaman
Eurodecor kitchens offer stylish new designs that make spending time in the kitchen a pleasure.
INTERVIEW26
JULY 24, 2009
FURNITURE
Offýce furnýture producers unhappy
wýth ‘ýnsuffýcýent’ tax ýncentýves
ESMA TEKÝN ÝSTANBUL
The government's value-added tax
(KDV) cut on furniture, slashing the
rate from 18 to 8 percent in an attempt
to boost domestic demand amid the ongoing
global economic crisis, has not been welcomed
by all businessmen in the sector.
Although the majority of furniture manufacturers applauded the incentive, some still
have reason to remain discontent. Office
Furniture Industrialists' and Businessmen's
Association (OMSÝAD) Chairman Ercan Ata
criticized the government's tax reduction, saying
it was not sufficient to solve the problems of the
sector and was far from meeting expectations.
"It is not so easy to claim that these tax reductions were beneficial to the producers. On
the contrary, they had a negative effect on us
since raw materials and intermediary goods for
furniture production were excluded from the
coverage of the incentives," he stated in an interview with Today's Zaman.
Therefore, Ata opined, the government must
consider introducing more comprehensive measures that include raw materials and intermediary
goods for the industry, as well, if it really aims to
alleviate the burden on the shoulders of the sector.
Ata further discussed the major problems
office furniture producers face these days.
According to him, the number one problem is
the high cost of employment, which he believes
cripples the industry's competitiveness, espe-
cially against producers in the Far East. The
burden of the KDV levied on raw materials and
imported intermediary goods used in manufacturing office furniture is also a serious problem, he said.
Ata listed the high cost of energy as another obstacle preventing the industry from enjoying success.
The government's failure to take measures
to increase public expenditure and domestic demand is another deficiency that needs to be
solved immediately to put office furniture production back on track, he underlined.
According to Ata, what has made this picture
gloomier is the increasing cost of production, particularly energy prices. Besides, he noted, the
chances of finding financial resources to fuel new
investments and production have also declined,
rendering the situation much worse for producers.
The figures provided by Ata show that the
Turkish furniture industry earned 47.4 percent
of its export revenue from sales to the 27 member countries of the European Union. In addition to this, the share of surrounding and
neighboring countries in Turkey's total furniture exports was 54.8 percent. "The share of exports to the traditional markets in Europe has
been on a declining tendency for the last three
years while that of surrounding and neighboring countries steadily increased," he noted, going on to say that this is a positive development
in terms of market diversification.
Analyzing furniture export figures, however,
Germany still tops the list of Turkey's best customers, with purchases worth $155.3 million in
2008. On the other hand, Iraq leads the list in terms
of the rate of increase in the amount of furniture
purchased from Turkey. France, Iran, Greece,
Britain, the Netherlands, Romania, Azerbaijan and
Russia are other "good customers" of Turkish furniture manufacturers, he acknowledged.
When it comes to the exports of office furniture, on the other hand, Germany is again at
the top of the list with $44 million. It is followed
by Iraq ($34.2 million), France ($27.3 million), the
Netherlands ($23.6 million), Russia ($13.8 million),
Greece ($12.1 million) and Iran ($9.4 million).
Ata's list of complaints continued. He further pointed to high rent and other overhead
costs at production facilities. In addition to
these, Ata claimed, the lack of protective measures against imports from rival Chinese producers makes it possible for them to flood the domestic market with cheap, low-quality furniture,
thus rendering local producers unable to cope with
the competition even in their own market.
The lack of qualified workers available for
employment in furniture manufacturing is another major obstacle to the industry's competitiveness, the OMSÝAD chairman said. The final
problem that prevents the industry from growing, he argued, is the government's failure to
prevent unregistered production in the sector.
Although he listed it as the last item in his list
of difficulties, Ata noted that the high level of
unrecorded production in the sector is a very
critical problem not only for the sector but also
for the economy as a whole.
SECTOR28
JULY 24, 2009
PHOTOS
TODAY’S ZAMAN
FURNITURE
Alfemo's new furniture line Corner Concept introduces new designs to suit evergy taste, demand and age group.
Alfemo growýng
strong wýth new stores
SABAHATTÝN SÜRMEN ÝSTANBUL
Alfemo, a Turkish furniture company
manufacturing uniquely designed
products, continues its steady growth
in the furniture arena, having added new
branches to a wide store network in both domestic and foreign markets.
Süleyman Zoral, Alfemo's marketing manager, picked out the store in Baku and a distribution center launched in Damascus in
February 2009 as recent examples of new
branches, as he evaluated the latest developments in the market to Today's Zaman.
Zoral explained that Alfemo welcomed the
wedding season because of the great advantages
stemming from the decreasing impact of the ongoing global crisis, as well as the overall seasonal upturn in the furniture sector. “But the most prominent advantage was thanks to the recent reduction
in value-added tax (KDV),” he highlighted. The
Barcelona, Alfemo's recently launched dining room set, reflects the magical flavor of the Mediterranean world.
government has recently lowered KDV on furniture in an attempt to lend impetus to the ailing
sector amidst the crisis.
line with the latest furniture fashion trends.
times. The Cleopatra collection, which was deIn addition to these advantages, Zoral added,
signed in a neoclassical style this year, is one of
Unique collections for different tastes the new products under the limelight. Comprising
they have embarked on a new campaign, offering
the essential furniture for setting up a house such
bedroom and dining room sets, the collection
Following modern technology, interpreting the
as dining room, bedroom and livmerges classic elements with a modern touch.
world's design trends and incoring room groups at “affordable”
porating authentic Turkish furniA stunning evening in Barcelona
prices. “Alfemo experienced a
ture fashion, Alfemo offers unique
higher-than-anticipated increase
products. The fast-growing firm
Alfemo's recently launched bedroom, living room
in its sales thanks to the opportuplaces great emphasis on cusand dining room suites, Barcelona, represents the
nities offered at the right time,”
tomer satisfaction both in domesmagical world of the Mediterranean. There are
Zoral said, noting that the comtic and foreign countries.
numerous aesthetic features that are instantly
pany would maintain the same
Alfemo introduces new devisible as well as those in hidden details. Crystal
pace of growth in the coming
signs for each taste, demand and
accessories and high-gloss black surfaces add to
months. With 24 stores in 59
age group within its product line
the elegance of the sets. Embellished with many
countries, Alfemo offers a wide
Corner Concept -- the most predetails, the Barcelona collection awaits cusrange of products designed in
Süleyman Zoral
ferred corner sets of recent
tomers seeking a different style.
FOCUS30
JULY 24, 2009
PHOTOS
TODAY’S ZAMAN
FURNITURE
Crýsýs offers furnýture
refýnýshers huge benefýts
Turkish furniture refinishers have seen a remarkable increase in orders and are navigating
the ongoing global economic crisis well while
the rest of the furniture sector's manufacturers are striving to keep the adverse impact of the crisis at bay.
As purchasing power nosedives further, many
Turkish customers are choosing to have their old furniture refinished rather than buying new sets -- the
main reason why things are going so well for refinishers. Speaking to the Anatolia news agency, Necati
Eraslan of the Konya Furniture Manufacturers
Industrial Zone said their orders have increased by
almost 100 percent since the advent of the crisis.
“Before, people would rarely get their furniture
refinished; however, with the arrival of the crisis
many have changed their minds. The inclination to
save has increased remarkably among our people.
They do everything to spend less money than before so that they can bring home their daily bread,”
he noted, adding that this has become more visible
particularly within the past year.
Underlining that furniture dealers have introduced many promotions, including sizeable discounts, to attract customers, Eraslan said this has
not helped them increase sales. Eraslan said a new
sitting room set costs customers some TL 5,000
while the cost of refinishing old furniture ranges
between TL 800 and TL 1,500. This means people
can refinish their furniture for less than half the
price of a brand new set, he emphasized. One of
the reasons people choose refinishers, Eraslan
went on to say, is that refinishers use quality fabric
and material. “On the contrary, new furniture is
made these days with relatively less durable fabric,” he said, emphasizing that an atmosphere of
cutthroat competition drives manufacturers to use
cheap materials when designing furniture. “They
are doing their best to offer the cheapest price,” he
added. Ýstanbul Today's Zaman with wires
Furniture companies seek new
incentives to boost exports
Hasan Karcý, the general manager of
Masko, a large complex of furniture stores
in Ýstanbul's Ýkitelli district, has called on the
government to introduce extra incentives for
furniture producers to fuel their exports, saying that increased exports will allow furniture
sellers to showcase their strength in international markets and turn the global economic
crisis into an opportunity for growth.
In a written statement yesterday, Karcý said
the furniture industry has been seeking alternative markets to stem the negative effects of the
crisis on business, but despite these efforts, it
was unable to save itself from a 40 percent contraction in the first quarter of the year.
However, after bottoming out in the first
three months of the year, the furniture industry
started to rally by April and has enjoyed a
boom in sales since then thanks to reductions
in the tax rates, Karcý explained. In April, sales
were as much as 25 percent higher than the
same month of the previous year, he noted.
The same upwards tendency continued in
the following two months, but if the government decides not to support the industry with
extra incentives, it is very likely that furniture
producers will sustain a harsh blow, Karcý
claimed. The furniture industry will likely enter its normal track by 2010, he stated.
He further underlined that the sector's exports had amounted to $1.3 billion last year,
adding that this figure shows how underdeveloped the sector's weight in the international markets is, considering that the size of
the domestic market was $7.5 billion in the
same year. Ýstanbul Today's Zaman with wires
Hasan Karcý, general manager of Masko, has
called on the government to introduce extra incentives for furniture producers to help fuel exports.