China Furniture Factories Piled up with Orders

Due to the impact of covid-19, we have suffered the deepest recession since the Second World War, with the largest fraction of economies experiencing declines in per capita output since 1870.

However, we have witnessed a rising market for industries such as furniture, home & garden, small home appliances, sports & entertainment, not to mention health and medical.

Take furniture as an example, from January to October, we have seen a year on year increase of 7.9% compared with the same period last year.

Start from July, order flushed in as many countries reopened and the production capacity in quite a lot of furniture manufacturing countries are restricted due to the pandemic.

At the same time, the demand of home office products dramatically increased as more and more people need to work from home. Moreover, except home office category, we also see a huge increase on categories of living room sofas, bedframes, kids furniture, outdoor furniture.,etc. It looks that people give more attention to their furniture as they had more time at home.

Unfortunately, due to the early lockdown impact, many furniture stores don’t have enough stock. So here in China we have witnessed a huge increase on B2B platform from individual buyers as well as traditional retailers, wholesalers, importers.

Take Alibaba for example, the turnover in furniture increased 224% in the super September promotion.  

As one of the results, many factories are piled up with orders. A lot of factories which deal with mass market are fully scheduled with orders to end of March 2021 at early October. Amid which is UE chairs, Kuka, zuoyou sofas, henling home furnishings,cheers sofas.,etc.

Now the main problem for over 90% of china furniture factories are not lack of orders, but below aspects:

1) shipment delays

2) lack of labors

3) Rising cost on material

Those 3 aspects will also influence importers like you. Here’s how:

1) Shipment delay

Almost all factories in China are fully scheduled with orders, it’s hard to have products in time. And what’s the worse is that other major furniture manufacturing countries are still struggling with covid-19 and production capacity are not fully recovered. So, your order will probably get delayed if you didn’t plan ahead.

2) Rising cost

Maybe you have also noticed that there is an increase in material such as TDI (main material for foam), steel, wood, metal parts., etc. What’s more, due to the tremendous orders, factories are lack of labors, the labor market price doubled compared with last year. What’s worse, RMB keeps appreciating against US dollars. It has dropped from 7.16 all the way to about 6.6. These situations will surely lead to a price increase. I guess you have already received price increase notice from your current suppliers.

3) Rising sea freight.

It’s not hard to forecast that carriers will reduce sailings due to the covid-19 impact. This has led to dramatically increase on sea freight. Take the US and Australia market as example, sea freight increased 3 times already. The sea freight to Australia used to be 700-1000 USD, but we have received quotes from forwarder at 3500 USD. And at the same time, it’s hard to get a container. What a…

According to the feedback from many of my customers, the worst part is not the above 3 aspects but the lost of market coz they don’t have anything to sell if not to plan ahead.

So far for BMS, we are also fully scheduled to end of December. If any orders need to be delivered before the Chinese New Year. Need to finalize the order with a down payment before the end of November.

Check bms collections at:  All Furniture

Plan ahead or nothing to sell.

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