Elmar Duffner

Furniture is cultural heritage. Worldwide!

Statistically, people spend 335 days a year at home. The notion of “home” is important to them. “Coming home”, a feeling recognized all over the world, is connected to familiarity and security. Complex, rapidly changing times also steadily increase this particular desire of people.

Think about the global development of furniture, for example. At producer prices, worldwide furniture consumption amounts to 376 billion USD. Worldwide commercial linkages increase steadily. However, there is a continuous decrease in production for internal markets because exporting furniture is becoming more important. Currently, 70 percent of all furniture sold in Germany are also “made in Germany”. This percentage decreases, however, because foreign furniture are becoming a sought after commodity. This is not distressing news, however, because German furniture are desired by foreign countries and they are successful export goods. The positive outcome of this development can be seen, when considering the German furniture industry, which also had its share of economic growth. The current upward trend feeds from construction investments as well as from private consumption in Germany and abroad. The increase in opened up markets, meaning the relationship between imports and consumption, had its peak in 2004, but lost strength in 2005. Nowadays, the main import countries for the major Western economies are the USA, Germany, the United Kingdom, France and Canada. Until 2007, the import of the United States was the driving force of the increasing world furniture trade. Yet, this trend dropped since 2008. After significant declines in 2008 and 2009, the American furniture market is predicted to stabilize in 2010 and is expected to grow from 2011 onwards. At the same time, China has become the world's most important furniture exporter. Within a decade, the Chinese furniture exports increased from $ 2 billion in 1998 to $ 26.8 billion in 2009. This trend is foreseen to continue for many years to come.

Within the context of globalization and the opening up of national markets, the cross-border trade in furniture has increased steadily over the past years. However, the global financial and economic crisis in 2008 and 2009, contributed to a slowdown in growth. The crisis left its mark on the international furniture trade, as the growth rate decreased by 17% in 2007, 4% in 2008 to - 10% in 2009. Available forecasts for this year, talk of an expected “back in the black”, while a growth of around 5% is prognosticated for 2011.

In 2010, the furniture industry stagnated in many countries, such as the United States, Japan and many others (Denmark, Belgium, Switzerland, Austria, Bulgaria, Slovakia, Slovenia, Serbia, and Croatia). In countries, such as Russia, France, Sweden, Norway, Brazil, Poland, the Czech Republic, Thailand and Viet Nam, however, a 1% increase is noted. The Middle-Eastern and Chilean furniture industry increased by 2%, the Indonesian by 3% and the Chinese and Indian furniture industry by as much as 6%. Unfortunately, the furniture industry in Canada, Australia, Italy, Spain, Portugal and Hungary dropped by 1%, in the UK by 2%, in Ireland by 3% and in the Baltic countries by 5%. Nevertheless, in 2011, the furniture consumption in all major markets is expected to stabilize. 

The European Union represents the largest market in the world with 27 member states. With approximately 500 million inhabitants and a gross domestic product of €11.8 billion in 2009, the EU exceeds, measured by means of population and economic strength, the former pioneer; the USA. Most European economies except Greece, Spain, Ireland and the Baltic States will return to economic growth in 2011. However, compared to the Asian economic area, the growth rate remains relatively modest. In this economic area, China and Japan represent the largest economies. According to the results of a study in 2010, China, with a growth rate of approximately 10% a year, will overtake Japan. China, India and Korea are and remain the "emerging markets" in Asia.

The export business of the German furniture industry has become attractive again this year. After a decline in business of 15% in 2009, revenues abroad have steadily risen to about 8.4%, which equals 5.8 billion €. It is particularly pleasing to note, that the German furniture industry’s export markets in countries such as France have risen by 15.8%. Switzerland is also keen on German furniture, as a rise of 12% in export rates can be recorded. In particular the Asian countries such as China (+ 39.7 percent), South Korea (+ 73.7%) and the United Arab Emirates (+ 29.3%) have shown the highest growth rates - at quite a moderate rate. Therefore, they display their importance in an increasingly expanding market. The Russian market recovered faster from the economic and financial crisis than expected, which resulted in an increase in German furniture exports to Russia by 18.2% in the first three quarters of 2010. Whilst many markets have not fully recovered from the crisis, the German furniture industry can and should be optimistic because their starting position to conquer market shares is rather good: In some countries, furniture, which were "Made in Germany" enjoy a high market share, which can certainly be reinforced and expanded. The availability of German furniture abroad is, statistically seen, on place 17 out of 30. For example, 22% of furniture sold in the Netherlands is made in Germany. In Belgium that number rises to 25%, in Austria to 61% and in Luxembourg to a staggering 66%.

German furniture are popular worldwide. The reasons for this are manifold. The justification for the popularity of German furniture can be explained by its many advantages, such as, its superiority of quality, its longevity and its original design. In late eighteenth century Europe, the working classes were enabled to purchase crafted furniture for the first time, as this had been the privilege of the aristocracy until then. The country was slowly democratized, ownership of capital and thus the opportunity to purchase land, real estate and most significantly furnishings were made possible. Therefore, the oldest and still existing production of furniture in Germany emerged in 1790. This scenario can be compared to the so-called “emerging markets”, where the population is encouraged to participate in the thriving economic growth. The quantity of furniture that could be demanded can now easily be prognosticated. One prognosis states, that the sheer volume of furniture that could be needed, would make the global furniture production a rising business opportunity. This conclusion can be drawn when multiplying today’s average industrial countries per-capita consumption by the amount of people of the emerging economies and then to count these two together. That it does not necessarily have to be that way, is the typical flaw in a prediction of this magnitude. However, the potential exists. 

German Design

The question whether German furniture design still has its own unique signature has to be answered with NO. The question whether it is even necessary to have such a unique German signature to furniture design, has to be answered with NO as well. Within Europe, country borders are only significant when studying maps or European history. Design, however, has emancipated itself from such trivialities. German furniture is not necessarily designed by German designers. Successful and reputable designers are sought after because they are internationally recognized. Therefore, many German furniture manufacturers collaborate with internationally renowned designers. Good design is not limited to political or geographical areas, but is always designed for and inspired by people. People have and should have different tastes when thinking globally. This is not surprising, as they come from different cultural backgrounds. Yet, good designs continue to be recognized and they are valid to all. 

German quality no longer smells of “machine oil” to the world. It is intelligent innovation we produce. Sophisticated and precise production technology is only one facet of this complex craft, because intelligent innovation starts with design. The optical appearance of a piece of furniture is only part of the intelligent and innovative design. Here are some examples which illuminate this point further: Electronic drawing-in of kitchen drawers; LED lighting in glass cabinets; electrically adjustable TV chairs also equipped with a massage function; retractable flat screens in sideboards; easy folding flap hinges in upholstered furniture; or sliding doors which are not in each other’s way. It makes sense to view design as something holistic. It can only be steadily improved by innovative ideas. Currently, furniture manufacturers are particularly successful, when they are able to produce a few “lines” of furniture, which are easily distinguishable from one another but can still be recognized as coming from the same company. 

In one point, however, us Germans do not compromise and we have the right to claim superiority to other nations producing furniture: we have the highest demand on design. As a result, good design is a very complex endeavor, including not only creative appearances but also the factors of quality, longevity, ergonomics, the way it feels and, environmentally friendly production. This holistic understanding of design supersedes competitors’ notions of design. A piece of furniture must not only be new, but better and more advanced than the old. The German furniture industry is a small to medium sized industry. Thus, it is forward-looking enough to meet future needs, but also flexible enough to respond quickly to initial challenges. It is an industry characterized by tradition and it is, therefore, associated with the needed experience. The industry is modern and courageous because it accepts the challenges of the markets.

We see a very positive future for the furniture and furnishings industries. The global demand and the need for furniture will grow tremendously in the coming years. 

INFO BLOCK VDM

The Association of the German furniture industry (VDM) is a regional and professional association, in which German furniture manufacturers are members. The association is the lobbyist for the industry concerning itself with political, economic and public affairs. In particular, the VDM observes and analyses trends in design, be it in Germany or abroad. VDM President is Elmar Duffner. As the Chief Executive Officer of the German luxury kitchen manufacturer Poggenpohl, he is closely connected to the subject of design.