Furniture firms set up joint company to increase exports
Engin Esen - ISTANBUL
Seven Turkish prominent furniture brands have gathered under a single name and established f-tr Furniture Partners, a company that will provide consultancy and research services to Turkish exporters in developed markets such as the United States, Germany, France and Britain.
“While we compete with each other in the domestic market, we have decided to create a strong synergy in order to cope with strong competition in foreign markets,” company chair Muzaffer Çelik told Hürriyet Daily News.
The incorporated company, which brings together Adore, Çilek, Doğtaş Kelebek, Gündoğdu, İşbir, Kilim and Nurus, has an initial capital of 10 million Turkish Liras (nearly $935,000), he said.
Overall, those companies have an annual revenue of around $530 million.
“Our group will conduct research and development [R&D] works and market research in the world’s large-scale importers such as the United States, Germany, Britain and France, where market penetration is quite difficult,” said Çelik.
In those selected countries they wish to engage in activities in areas such as joint logistics and after-sales services.
The joint company will also work to overcome the “scale problem,” which is a main obstacle for the Turkish furniture sector particularly in competing against China, he added.
“When it comes to exports, we believe that uniting our scales will bring various advantages. With this exports’ partnership, we will unfold our strong aspects. Our main purpose is to increase added value in our products and to improve our capacity utilization.”
The Turkish furniture sector has expanded rapidly in the last two decades. In terms of furniture exports, Turkey ranked eighth in the world in recent years.
In the first 11 months of this year, Turkey exported furniture exports worth $3.9 billion, up 25 percent year on year. In the same period, furniture imports stood at $500 million.
According to these latest figures from the Ankara Chamber of Furniture Merchants, Turkey has climbed to the rank of six with a share of 3 percent in global furniture output.
“Our growth target is to be among the top five countries. We have been developing extraordinary strategies to get there. We are learning what can be sold in the target markets and analyze their needs. Instead of trying to sell our products, we are planning to make products that could be sold in those markets easily,” Çelik said.
The United States was the top importer of furniture products last year paying $75 billion, and the majority of those products - worth $55 billion - came from China.
Because of the pandemic-related supply chain disruptions and increased freight costs, Turkey has gained some market share from China in the U.S. market, according to Çelik’s remarks.
Turkey also has a big advantage in the European markets because of its proximity to the region and the wide array of road, railway, sea and air transport opportunities.
f-tr Furniture Partners will take part in the five-day Istanbul Furniture Fair which will launch on Jan. 25, 2022.