Chiniot's Furniture Industry

Furniture Industry of Pakistan
Chiniot’s Furniture industry

GroupAMJAD
Members:
NAWAZ
AMMAR AKRAM ALIZAI
SAQIB KHAN
ZAIN GOHAR
SYED HAMMAD RAZA

 Ammar Akram Alizai
Furniture Industry
 The “wooden furniture” industry represents 95 percent of the
total furniture market in the country.
 The leading furniture making areas of Pakistan are Chiniot,

Gujrat, Peshawar, Lahore and Karachi.
 Exporters are suffering manifold problems while local

manufacturers are facing challenges due to heavy imports of
furniture.
 Chinese furniture has also hit the local industry by 70 percent

and the sales of locally manufactured household furniture have
gone down by 30 percent.
Furniture Industry
 The prices of all raw materials used in making
furniture which include chipboard, timber, foam,
polish chemical materials, color paints and hard ware
have increased.
 Timber production on the other hand has gone down

drastically because of unchecked deforestation.
 Pakistan’s major buyers of wooden furniture are the

UK, the USA, Sri Lanka and Gulf countries like the
UAE, Saudi Arabia, Oman and Kuwait.
Furniture Industry
 Quality export furniture is being produced at
Chiniot, Gujrat, Peshawar, Rawalpindi and
Karachi.
 The demand for Pakistani furniture has been rising

constantly.
 It has bright prospects to export more than $1

billion worth of furniture annually in the
international furniture market.
Chiniot’s Furniture Industry
 Chiniot is world famous for its exotically carved and
brightly lacquered furniture.
 Furniture making in Chiniot forms a vital part of

Pakistan's secondary industry and is also essential to
the Punjab’s regional economy.
 In total there are more than 175 small and medium

furniture manufacturers in Chiniot. And there are over
2500 home units operating in Chiniot.
 Zain Bin Gohar
Literature Review
(ARTICLES)
 Prospects and fears for Pakistan’s furniture industry
 Why do small firms fails to graduate to medium and large firms in

Pakistan
 Wooden furniture: Great Export Potential
 Dimensions of manufacturing strength in the furniture industry
 Aggressive and passive exporters: a study in the furniture

industry
 Handbook On Long Term Financing Schemes Of State Bank Of

Pakistan
Hypothesis
Empowering through
Change in Government Policy
Chinioti Increased
Furniture SME’s Exports
“Empowering Furniture Manufacturing based

SMEs in Chiniot will result in higher volumes of Furniture
Exports”
Population Frame
 Population Size: 175 SME’s (According to
SMEDA’s Data – 2009)
○ Other Home Based Units : 2500
 Sample Size: 12 SME’s (Convenient Sampling)

 Limitation
We were not able to travel to Chiniot, therefore did
telephonic survey
Lack of Funds
Time
Questionnaire
 Are you an exporter of furniture?
Answer
8
7
6
5
Answer
4
3
2
1
0
Yes No
 Hammad Raza
Questionnaire
 Your Annual Turnover?
Answer
6
4
Answer
3
0
Below 1M 1.5M - 3M 3.1M - 5M Above 5M
Questionnaire
Do you think that government support to this industry is
sufficient?
Answer
10
9
8
7
6
Answer
5
4
3
2
1
0
Yes No
Questionnaire
Have you ever been rejected on the reasons of bad quality?
Answer
10
9
8
7
6
Answer
5
4
3
2
1
0
Yes No
Questionnaire
 Do buyers try to influence your furniture designs?
Answer
9
8
7
6
5 Answer
4
3
2
1
0
Yes No
 Amjad Nawaz
Problem Identification
 Sheesham Wood getting expensive
Chinioti Furniture is known for use of sheesham wood in carving, the
recent increase in its prices has affected the industry in a big way. To
cover this huge amount of sheesham is imported which is 4 times
expensive.
 Transportation rates are increasing

Where previously a company would have sent 4 containers, it ends up
sending only two. Diesel/petrol rates have also increased.
 Raw material is diseased

Raw materials cost is high and it is of sub standard. As a result, low
quality of furniture is produced. Companies have to suffer severe loss.
Problem Identification
 Customs examination done is very severe
During customs examination furniture is broken / torn for inspection. As a result all
material has to be made again. A huge loss is incurred on the companies.
Some companies give money and get their material cleared from the Customs. In
this process, even the poor quality material reaches foreign buyers and the image
of the whole industry is destroyed.
 Problem in basic utilities

Load-shedding is a major problem. Furthermore, gas rates are on the rise with
increase shortage of supply too.
 Railway Transportation
Pakistan Railway is only used for movement of bonded goods and it is not
available for commercial exporters. Railway is one of the most cheapest means of
transportation in country.
Other Factors
 Lack of space is a problem
Because of small area, less pieces of furniture are produced. There’s 40% loss
and as a result all opportunities are lost. If more material is produced, it is wasted
because there is no space for its storage.
 Lack of practical implications

SMEs seeking to go international need to learn a lot about external and internal
environment impacting their organizations.
 Lack of skilled labor

Since the injunction of contemporary furniture, there is a decline in overall hand
carvers in the market.
 No association or chamber to support these SMEs

There is no established association or chamber who help protects the rights and
problems faced by this industry.
 Saqib Zahoor Khan
Other Obstacles
 Access to the international markets tends to be a problem
As producers may be unfavorably located; far from the main consumption
centers and suffer from costly transportation.
 Access to raw materials at competitive costs becomes a

problem as SMEs
This can become a hindrance to organizing the flow of raw materials from
domestic, non-transparent timber markets controlled by various
intermediaries, and often leads to timber shortages just when exports are
growing.
 Access to knowledge and technology is a major problem area.

SMEs tend to fall behind because of their strong reliance on traditions: e.g.
they may be using high-value timber for secondary uses, simply through
force of habit and thus gain revenues far below the timber’s real potential.
Other Obstacles
 Access to capital is difficult to find at competitive rates
Since domestic bank finance is scarce, interest rates are
generally high and collateral requirements are strict.
 Access to designers is limited

The exporters rely on simply selling items “as they are”, copying
new models or producing according to the buyer’s designs.
 There are shortages of skilled labor and in-house

training
(Apprenticeships, on-the job training, etc.) is usually considered
too much of a burden.
Conclusion & Recommendation
 The government should initiate export quality standards in conjunction
with PCSIR, through which substandard and low quality furniture
should be discouraged and manufacturers and suppliers of quality
furniture made of quality wood should be issued a certification. This
helps exporters and manufacturer get orders from European and
American countries.
 Government should encourage hand carving art and train workers in

this field in the vocational training institutes so that more carvers
graduate with the required skills to support the industry.
 To help reduce Sheesham Wood prices the government should wave

off the duty on import of this wood. This will help bring down the prices
of Sheesham wood in local market and thus reducing the overall prices
of hand carved furniture.
Conclusion & Recommendation
 Government should subsidies 50% of the total transportation cost of inland
goods movement especially for this industry to encourage furniture exports.
 Government should allot its own land and warehouses are reduced prices with
proper infrastructure to store furniture and charge a nominal rate. The proposed
location of this warehouse could be near the Chiniot bypass near the motorway.
 Government should make a new department inside the Export Promotion

Bureau, and its sole purpose should be to promote the furniture industry of
Pakistan. It should mediate between foreign exhibitionists and the exporters so
that Furniture manufacturer can participate in such exhibitions worldwide.
 Government should subsidize import of latest technology so that manufacturer

is encouraged to use latest technological means of manufacturing.

Chiniot's Furniture Industry

Uploaded by

Copyright:

Available Formats

Chiniot's Furniture Industry

Uploaded by

Document Information

Original Description:

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Chiniot's Furniture Industry

Uploaded by

Copyright:

Available Formats

Furniture Industry of Pakistan

Chiniot’s Furniture industry

AMMAR AKRAM ALIZAI

SYED HAMMAD RAZA

 The leading furniture making areas of Pakistan are Chiniot,

 Exporters are suffering manifold problems while local

 Chinese furniture has also hit the local industry by 70 percent

 Timber production on the other hand has gone down

 Pakistan’s major buyers of wooden furniture are the

 The demand for Pakistani furniture has been rising

 It has bright prospects to export more than $1

 Furniture making in Chiniot forms a vital part of

 In total there are more than 175 small and medium

 Why do small firms fails to graduate to medium and large firms in

 Wooden furniture: Great Export Potential

 Dimensions of manufacturing strength in the furniture industry

 Aggressive and passive exporters: a study in the furniture

 Handbook On Long Term Financing Schemes Of State Bank Of

“Empowering Furniture Manufacturing based

 Sample Size: 12 SME’s (Convenient Sampling)

 Transportation rates are increasing

 Raw material is diseased

 Problem in basic utilities

 Lack of practical implications

 Lack of skilled labor

 No association or chamber to support these SMEs

 Access to raw materials at competitive costs becomes a

 Access to knowledge and technology is a major problem area.

 Access to designers is limited

 There are shortages of skilled labor and in-house

 Government should encourage hand carving art and train workers in

 To help reduce Sheesham Wood prices the government should wave

 Government should make a new department inside the Export Promotion

 Government should subsidize import of latest technology so that manufacturer

You might also like