Despite rise of other sources, China likely to stay on top
Larry Thomas -- Home Accents Today, July 12, 2012
The increasing cost of importing furniture from China has caused many suppliers to look to factories in other Asian countries, but a panel of furniture executives agreed that China is likely to remain a key source for many years to come.
Speaking at Sandow Media's second annual Logistics Conference, panelists said most other Pacific Rim nations don't have the roads, port facilities and other infrastructure in place that would enable them to move large amounts of production out of China.
However, that hasn't stopped them from looking at - and in some cases, shifting production to - other countries.
"We feel like we have our eggs in more than a few baskets," said Scott Prillaman, director of transportation and logistics at case goods source Hooker Furniture. "We have to be on our toes and continue to look for the next best source."
Fellow panelist Joff Roy, president of Jofran, an accent furniture specialist, said his company recently began importing from countries such as Malaysia and Cambodia, but is not even close to giving up on China.
"We believe in diversification, but we're still finding tremendous values in China," he told conference attendees.
Joining Prillaman and Roy on the panel were Robert Buford, logistics manager for furniture source Home Meridian International, and Ken Donham, senior director of sales operations for A.R.T. Furniture.
Since A.R.T. relies on China-based Markor Furniture as its sole supplier, Donham believes it gives his company a competitive advantage because it has much more control over product quality and overall costs.
"We can react to change more quickly," he said.
Buford and others said the expectations of retail customers are rapidly evolving as consumers increasingly refuse to wait for weeks for delivery of their new furniture.
"We need to do it faster and smoother than we did it yesterday," Donham said.
The other three panelists - all of whom import from multiple factories - said it's critical to become partners with factories that will ship quickly and within the promised timeframe.
"It's always difficult to get them to ship on time," Roy said.
Buford and Prillaman said their companies have tried implementing financial penalties for Asian factories that don't ship when promised, but haven't found them to be an effective deterrent.