Chinese bull scares local lions!

THE CHINESE moth is eating up the local furniture manufacturers in a big way. And there is no solution in sight to stem the rot. With a priceline on Chinese furniture lower by at least 45 per cent compared to any locally made furniture, the city?s more than 15,000 small manufacturers in the largely unorganised local furniture manufacturing industry haven?t still got a clue on where they would be heading in the next few years.

THE CHINESE moth is eating up the local furniture manufacturers in a big way. And there is no solution in sight to stem the rot.

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With a priceline on Chinese furniture lower by at least 45 per cent compared to any locally made furniture, the city’s more than 15,000 small manufacturers in the largely unorganised local furniture manufacturing industry haven’t still got a clue on where they would be heading in the next few years.

To add to the woes of local manufacturers is the fact that all the Chinese furniture is entering the Indian market legally with payment of import duties and other applicable taxes by the importers.

“Furniture production is down 50 per cent in the city. The Chinese sofas, cabinets, dining tables, chairs and the computer furniture are far superior in quality and design compared to locally made products. The huge price differential between local and Chinese furniture has opened a huge opportunity for retailers at the cost of local manufacturers still struggling with higher cost of raw material and mounting tax burden”, says Rajeev Kakkar, owner of a furniture manufacturing unit.

He says the Chinese have captured every segment of the local furniture market in the past two-and-a-half years.

The heavily subsidized furniture industry in China provides a huge low- cost manufacturing advantage to the Chinese manufacturers which is not available to the Indian manufacturers.

“Most of the time the furniture manufacturers in the city are grappling with severe power shortage problems. The entire belt of Thakurganj, Balaganj and Aishbagh where most of the small furniture manufacturers have their units have been hit badly by rising cost of raw material and the retailing push being provided to Chinese imports by the local retailers who have gained immensely from the price war in the furniture industry”, Kakkar says.