TURKİSH FURNITURE MARKET

In recent years, the Turkish furniture industry has become one of the driving forces behind the Turkish economy. Thanks to globalization, innovative improvements and brand marketing strategies, furniture production in Turkey has improved its international reputation and has expanded into new markets.  With its designers and architects combined with its flexible production capacity, the Turkish furniture industry is able to satisfy the requirements of all individual markets all over the world. Today, with all these aspects of the furniture industry, Turkey is among the most promising furniture suppliers in the world.

FURNITURE PRODUCTION IN TURKEY

Beginning with small workshops producing hand carved and handmade furniture during the 19th century, the Turkish furniture industry has expanded into a sector whose exports stand at $1.5 billion annually.

Small workshops still play an important role in the industry with their flexibility and sufficient labor force to increase production for large supply while large-scale furniture firms in Turkey produce the latest models oriented towards exporting.

It is estimated that the sector comprises about 35.000 manufacturing companies and 40,000 retailers, according to the 2008 data provided by the Turkish Statistics Institute. The industry, which is dominated by small enterprises, has only 40 companies with more than 250 employees and 150 companies with more than 100 employees, according to a report from the Turkish Union of Chambers and Commodity Exchanges (TOBB).

The domestic market volume of the furniture sector, which has an 32 percent annual growth rate between 2003 and 2008, totaled $ 11 billion in 2008 based on retail sales prices. In between these years, the Turkish furniture sector has grown at an outstanding pace, experiencing an average growth rate of approximately 32 percent per year. Contrast this with other major growth sectors, such as the automotive sector, the flagship of Turkey's exports whose annual growth averaged 21.5 percent in the same period, and the dynamism of the furniture sector becomes all the more clear.

In fact, when compared to the other top furniture exporting countries, Turkey was in the forefront in terms of growth, averaging an annual growth rate of 29.1 percent in 2008. The nearest rival was China, the leading global furniture exporter, which experienced a growth rate of 21.1 percent during the same period.

In Turkey, approximately 260,000 employees are directly involved in furniture production, while the sector generates roughly 500,000 positions when side industries are taken into account. Geographically, Istanbul, Ankara, Izmir, Bursa (Inegol) and Kayseri are the regions leading production in the sector. Inegol is an important production district due to its rich forest areas. Kayseri, on the other hand, accounts for approximately 50 percent of production in Turkey, even though it has no forest resources that are essential for furniture production.  Currently 11 of Turkey's 20 largest furniture manufacturers are established in Kayseri.

Turkey has an important manufacturing sector for furniture components, such as metal parts, timber products and chemical components. As the main furniture sector develops, furniture sub sectors are also improving. The export levels of furniture components and raw materials have seen an upward trend in the last 10 years, parallel to the improvement of the industry and marketing efforts.

In last 10 years, the investment in new technology has been increasing in the sector to meet international quality standards. Most of the companies have already obtained ISO 9000 certification and other required quality certificates.  As design has become one of the most important aspects of furniture, Turkish furniture firms have begun to employ more designers to develop new styles and to meet the ever-changing tastes of customers. In this respect, Turkey's strong textile industry, which offers a wide range of colorful fabrics, is a major advantage for Turkish furniture manufacturers and Turkish designers are widely using this advantage to offer a wide range of fabric collections as upholstery.

Wooden furniture in Turkey has a major share in total furniture production in the country. The main types of wood used in furniture production in Turkey are ash, beech, oak, pine, linden and mahogany. Turkey is also a large supplier of futons, ranking fourth in the world in terms of exports. Turkish furniture factories use the latest technologies in producing furniture and comply with world standards. Applications of advanced technology and the use of CNC benches in the Turkish furniture industry have been widespread for almost two decades.

FURNITURE EXPORTS and IMPORTS

According to statistics provided by the General Secretariat of Istanbul Exporters Associations (IIB), Turkey's furniture industry has seen rapid growth in exports over the past 10 years and Turkey ranks as the 16th largest exporter of furniture in the world in terms of revenue, having brought in an impressive $1.531 billion in 2008.  Turkey imported $938 million of furniture goods in 2008 enabling the sector to be one of the rare sectors in which Turkey has a positive balance of trade. The Association of Turkish Furniture Manufacturers aims to witness exports reaching $2.5 billion by 2010.

In 2009, Turkey exported furniture to 166 countries throughout the world. The main markets for furniture exports were Iraq, Germany, Iran, Azerbaijan, France, The Netherlands, Greece and the United Kingdom. Imports, on the other hand, come primarily from China, Germany, Italy, France and Poland.

In recent years Turkish furniture companies have been establishing showrooms and depots in increasing numbers in most of these countries. The Turkish contracting sector is one of the major sectors exporting services. Turkish contractor companies who have undertaken construction work abroad have completed many housing complexes, tourism projects, hospitals and health center projects, most of which were decorated with Turkish furniture.

POST CRISE PERIOD FORECASTS AND COMPETITIVE ADVANTAGES OF TURKISH FURNITURE INDUSTRY

Turkey is one of the European countries (may be the sole) that is not so much affected relatively by the global crisis due to its strong banking industry, flexible economical structure and social organism familiar with crisis. Although moral impacts of the crisis period affected domestic furniture sales negatively as expected, the government took some precautions to handle the problem. They tried to weather the bad effects of the crisis with the help of reductions in the value-added tax (VAT) and some financial supports and they succeeded. in the last quarter of 2009, a roughly 35 percent rise was seen in domestic sales figures,. Similarly, furniture producers which were dismissed 26.000 workers in the first 3 months of the crisis, after taking all these precautions,  hired all of them in order to continue the production. In fact, furniture production never stopped in Turkey and companies carried on their investments during this period.

Although the crisis has resulted in a considerable drop in exports in 2009 as Turkey's traditional export markets have been wracked by the recession, Turkey is poised to increase its market share further. According to the MOBSAD report, furniture exports showed a roughly 40 percent drop, mostly to Europe. But on the other hand, furniture exports to Middle East countries where the crisis is not felt, too much is increased approximately 100 %.

Not only does the country benefit from a unique geographic position, serving as a bridge between East and West, but of equal importance, the country's long history and reputation for producing classic oriental designs, popular with Turkey's immediate eastern neighbors, suggests that the country will be best placed to extend its reach into neighboring Middle Eastern and Central Asian markets whose disposable income is increasing at a much more rapid rate than those of the European markets.

Already, Turkey's exports to Iraq, the second largest importer of Turkish furniture, has almost doubled in the last two years, from about $58 million in 2006 to over $104 million in 2008. Iran is also absorbing increasing amounts of Turkish imports, moving up on the list from a distant number eight of the top 10 importing countries, to number four.