Special Report  

The March trade shows inSouth-East Asia and China

By Roberta Mutti - Italian Consulting Pte Ltd

Southeast Asia, Guangzhou, Shanghai: the furniture fairs of March are a good opportunity to understand the evolution of the market in those areas. MIFF, IFFS, CIFF and Design Shanghai constitute a privileged observatory on an area of the world in great development.
According to data updated to 2017, currently the world production of furniture (excluding markup for distribution) is worth about 430 billion dollars, of which more than 50% is produced between China and Asia; another interesting fact is that about 49% of furniture made in Asia-Pacific remains in Asia-Pacific. By 2021, world furniture consumption is expected to reach $700 billion, of which more than 50% will be produced and sold in Asia-Pacific.

In order to fully understand what those data really mean, it is also worth looking quickly at the forecast development of the luxury market worldwide, which also includes highend furniture. According to a study by ApacMarket, the luxury furniture market will reach $5.5 billion in 2020, with the hospitality sector growing faster than the residential and domestic sectors; all the countries of Asia-Pacific are experiencing rapid growth, so per capita income is growing at the same rate, allowing consumption to expand.

With such a large market, growing at this rate, the mid- and high-end ranges become more attractive than the low-end, thanks to the higher profit margins they allow. For this reason, both companies and trade fairs are increasingly interested in the development of design products.

What emerges from the visits to the fairs, however, is still a lack in the distribution concept and in the development of advanced marketing techniques, which does not go hand in hand with the evolution of product development.

Moreover, from the point of view of technology and automation of work, most of the production in Asia-Pacific is still rather backward, with a great deal of manual work and a lack of advanced processing machines, even more pronounced than just the lack of development in digitization.

MIFF - Malaysian International Furniture Fair Over the last 10 years, MIFF has undergone a major transformation. First of all, the 2018 edition was held in the new fairgrounds, MITEC (Malaysia International Trade & Exhibition Center) which, added to the traditional PWTC (Putra World Trade Center) location, has allowed it to occupy up to 100 thousand square meters of exhibition space. Malaysia has ambitious targets, with MYR12 billion (about 2.4 billion euros) in furniture exports to be reached by 2020, to regain 7th place in the world ranking of countries exporting furniture (they are currently in the eighth position).

MIFF contributes to this goal, thanks to an active policy of involving companies in the development of design products, through the claim “Design connects people”, organizing many seminar programs during the fair, and fostering the interaction with young designers. Malaysia is also in a privileged position for relations with the Middle East, facilitated by being a country of Islamic religion.

In 2019, MIFF will celebrate its 25th edition, an edition that promises to be interesting; the 2018 edition registered more than 20 thousand visitors, with 625 exhibitors.

From MIFF 2018, Eggy, a daybed for outdoor living by Italian designer Andrea Brugnera for Malaysian company SJY.
From MIFF 2018, a total look for bedroom by Singaporean company Jotter Goods.
IFFS - International Furniture Fair Singapore

The 2018 edition of IFFS Singapore, the 38th, saw both exhibitors and visitors fall slightly compared to 2017. For several years now, Singapore’s furniture industry and the trade fair that represents it, IFFS, have been looking for a new positioning, one that places furniture in a status of creative industry, with economic value but at the same time high-level design.

For some years now, IFFS has been working to find a new course, with new participation and a different setting for some sections of the show, such as The Italian Hospitality Lounge, curated by Giulio Cappellini, Carte Blanche, curated by Chantal Hamaide, and special participation of local designers of international renown.

The real revolution, however, will take place in 2019, when IFFS will move to Marina Bay Sands, at the Sands Expo and Convention Center; a prestigious location, which marks a marked discontinuity with the past.

From IFFS 2018, The Italian Hospitality Lounge, a show curated by Giulio Cappellini.

Design Shanghai

At the same scale as MIFF and IFFS, Design Shanghai, held in March in Shanghai, has reached its fifth edition in 2018. However, perhaps because of its geographical location in Shanghai - an international and cosmopolitan metropolis - or perhaps because of the English organization, Design Shanghai is much more reminiscent of a London show than an Asian fair.

Among the participants there are many Italian and international companies, high-end design, and even a substantial share of the 50 thousand visitors is made up of an equally cosmopolitan audience, passionate about high-level design and collectibles.

Design Shanghai confirms that some areas of China are now ready to make the big leap towards high-end design.

At Design Shanghai 2018, the Italian company Gufram, in the “Collectible design” section.

At Design Shanghai 2018, installation by Czech company Lasvit.
At Design Shanghai 2018, the Chinese company Zaozuo, with the art direction by Italian designer Luca Nichetto.

CIFF Guangzhou

CIFF Guangzhou represents a completely different exhibit, since it has been held for over 20 years (March 2018 was the 41st edition), and is of gigantic dimensions.

Initially created for the market of companies in the province of Guangdong, it has turned into an increasingly international fair, which now attracts about 200 thousand professional operators from around the world. Over the years, products have evolved, and today for quality and aesthetics they can compete with most of the products that, until a few years ago, China imported.

In 2015, CIFF decided to double up, moving the September edition to Shanghai and, as Shanghai’s ecosystem is totally different, CIFF Shanghai is becoming an event with an increasingly high-end design content.

CIFF Shanghai has also activated several initiatives to promote trade and distribution, and, from September 2018, CIFF Shanghai will begin a strategic cooperation with Red Star Macalline, a distribution chain, one of the most important players for the sale of furniture and design in China.

From CIFF Guangzhou 2018, Commune, a brand by Koda, from Singapore, selling a total look in its mono brand stores.
From CIFF Guangzhou 2018, Aris, a Chinese company
manufacturing and selling upholstered furniture, designed by the Italian designer Marco Giorgetti.
CIFF Guangzhou Opening Ceremony

Marketing, distribution and digital: new strategies for furniture

The transition of the business from a low cost industry to a system that produces the highest value content is of course not easy. If we take Italy as a reference - the third biggest exporter of furniture in the world, and the first in the premium sector, with a market share of 30% - we see how the furniture industry, in addition to occupying an important place in the Italian trade balance, is one of the main communication vehicles of the Italian lifestyle in the world, thanks to the Salone del Mobile, the largest and most important furniture - and also - lifestyle event in the world.

This small parenthesis is necessary to underline that the passage from a commodities industry to a high added value industry requires the development of business models, involving technological and digital development, communication and marketing, with huge investments in research and development of products, in their marketing, the search for new distribution channels, even a new business model, also from the point of view of environmental sustainability.

In fact, some companies that are looking for alternative ways to the simple production/sale of container goods, and they are also companies achieving excellent results.

The Singapore-based company Koda, for example, under the Commune brand, has developed a distribution and sales concept which led the company to already open 50 mono-brand stores in China, planning the same number in 2018/2019.

Commune, as Ernie Koh, owner and member of the founding family, explained, has developed a sales concept including furnishings, linens, and accessories, as the goal is selling an atmosphere, a lifestyle, the value which can make a difference.

A similar concept was also developed by Star Furniture, also from Singapore, under the Jotter Goods brand.

Ahmad Suradi Anan - the founder of Nokta, a Malaysian brand that specializes in storage units and furnishings for living areas, employing high quality materials, international designers, original design and showing in many international trade fairs - has clear ideas.

The company bought and installed modern machinery for a technologically advanced production, and invests in research and development of new products, which it exhibits at all major international trade fairs, in Asia, for the time being, but as a future objective also in Europe and the USA.

An interesting example of a company born in China, but with an international scope, is Stellar Works, a cosmopolite entity based in Hong Kong, with a Shanghai manufacturing plant, a Japanese founder, the art direction carried out by a couple of American architects of Chinese ethnicity, and hip international designers. It can be seen in Milan every year, from 2018 at Imm Cologne, in London during the London Design Festival, and wherever there are major design events.

And a very successful case is Aris, a Chinese upholstery manufacturer who invested in a design brand, involving an Italian designer, Marco Giorgetti, to whom he entrusted the design of the products, and, at the same time, hired a TV star as a testimonial, committing considerable budgets in advertising.

These few examples are all success stories, and demonstrate that, if there is no clear marketing strategy, hiring a designer for some product can prove to be a minor intervention, which does not affect a real change of pace.