South Africa’s furniture industry is in a state of distress, but a collaborative approach between industry, labour and government has the potential to promote its development and growth.
In this vein, a Furniture Master Plan and Action Plan is being pursued as a joint initiative between government and the industry.
This was the overarching theme at the Proudly South African Furniture Sector Forum, held on Wednesday, in Johannesburg.
Speaking at the forum, South African Furniture Initiative (Safi) chairperson Penwell Lunga elaborated on the current state of the furniture industry in South Africa.
Safi was established in 2016 as a nonprofit company and as a joint initiative between government, labour and industry to strengthen the furniture industry in the country.
Lunga said South African manufacturers could not compete against Chinese imports and continued to lose market share.
Moreover, the concentration of the furniture retail sector is declining.
He noted that the low-end consumer market had migrated to the informal market, which was largely serviced by cash informal traders.
Another issue facing the sector is the considerable growth of illegal imports. Lunga indicated that this hindered local manufacturers, as they were unable to compete with cheaper prices.
During the forum, another issue that came up in multiple discussions was a lack of skills in the industry.
These issues therefore engender an industry that is characterised by a lack of employment growth and opportunities.
Therefore, to mitigate these issues and turn the situation around, a number of strategic priorities are being pursued within the industry. This includes creating market access opportunities for local manufacturers; facilitating investment in technology to drive innovation and productivity; and investing in both design and technological skills.
Moreover, this includes increasing research and development to support the industry, which takes into account the fact that it is part of a global market.
The Furniture Master Plan, therefore, aims to investigate how best to protect the current industry and retain existing business in the short term.
It also aims to develop a growth plan, outlining how to improve productivity and competitiveness in the industry, create employment, and create markets for local products.
Lunga emphasised that the process of formulating the plan would be inclusive, to ensure that the broad spectrum of the industry was included and that all issues and relevant facets were acknowledged.
He called on all stakeholders in the industry, and across the furniture value chain, to participate in the process, from labour to business.
Department of Trade, Industry and Competition (DTIC) Agroprocessing and Resource Based Industries chief director Ncumisa Mhlauli-Mcata indicated that the process would entail extensive workshops with procuring agents and manufacturing entities.
Lunga noted that facilitating the development of the plan would constitute a 50% costs split between government and the industry.
Safi and the DTIC have finalised terms of reference in order to compile a master plan. A service provider for the plan will be appointed by the end of the month. The plan is slated for finalisation by the end of December.
A number of other initiatives and interventions are also being pursued by both the government and within the industry to tackle the earlier mentioned challenges and grow the industry.
This includes trade remedies and custom enforcement; market access programmes; an export council; and a furniture manufacturing hub.