This section describes the strengths, weaknesses, opportunities and threats (SWOT) analysis of Indonesia’s furniture industry to identify the competitiveness of Indonesian furniture product and the condition of Indonesian furniture industry to meet EU market access requirements.
Based on study that was conducted by Lord, Oktaviani and Ruehe (2010), the strengths, weaknesses, opportunities and threats of Indonesia’s furniture industry are as follows:
Natural resources abundant is one of the most competitive advantage which is own by Indonesia’s furniture industry. Supply of raw materials such as wood, bamboo and rattan are available and very easy to get. Moreover, labour cost for this industry is also low, good workmanship especially in carpentry and manual carving become another great advantages for this industry. Furthermore, this industry also has a furniture association (ASMINDO) which has large network to import destination countries.
Indonesia’s furniture industry needs relatively long time in delivering its product to international buyer. This could be caused by many factors such as, inefficient bureaucracy and lack of infrastructure in transportation. Another factor is the producers tend to have different standard, especially in producing parts of furniture, this could hindrance the ability to interchange parts between producer and caused inefficiency in productivity. Furthermore, there is lack of Voluntary Partnership Agreement (VPAs) between Indonesia and EU especially for the implementation of Forest Law Enforcement Government and Trade (FLEGT) and government laboratory such as BPMBEI which conduct testing for furniture product is not yet int...
... middle of paper ...
...ade of solid wood.
The challenges that Indonesia’s furniture industry has to face mostly concentrated in supply side constraints. Exchange rate and cost of production have a significant impact on Indonesian furniture export because it will affect export price of this product. However, non-price factors such as design, quality, and delivery reliability that must be more considered by the Indonesia’s furniture industry because these factors have consistently decrease Indonesia’s export to the European Union market.
In increasing Indonesia’ furniture export to the EU required a solid cooperation between Indonesia’s economic operator such as government, industries and association. They have to work together to increase the capabilities of the furniture industries especially in strengthen the quality, design and market access of the furniture products to the EU market.
Need Writing Help?
Get feedback on grammar, clarity, concision and logic instantly.Check your paper »
- 2. BACKGROUND 2.1. Indonesian Furniture Industry This section provides an overview regarding the role of Indonesia’s furniture industry for its economy, also general information about the type of furniture products that have been exported to EU market and some furniture exporter countries which become the major competitor for Indonesia. Indonesian furniture industry is one of the potential sub sector in Indonesia. This Industry creates great job opportunities for Indonesian people. Furniture industry employs two million people directly, with an additional eighth million workers indirectly.... [tags: European Union, International trade, Export]
1012 words (2.9 pages)
- Situational Analysis The rivalry between existing companies is intense in the global furniture market and key industry players in Europe include Designs Inc, Galiform plc, Wal-Mart Stores Inc., Argos and others. However, Ikea today is the undisputed market leader in the furniture industry discount on the global scale. The threat of new entrants in the industry is low, and the chances of entrance of new competition Ikea is scarce because the current market is saturated and the significant amount of financial investments and experience are necessary to become a shop furniture discount on a global scale.... [tags: Marketing, Strategic management, SWOT analysis]
1015 words (2.9 pages)
- As indicated in the chart above, it is a huge market because of the population, more consumers as well as great opportunities for expansion; they are interested in purchasing American style furniture, middle class is growing about 3 to 4 percent of the total population with an outstanding buying power for western style furniture centered on Shanghai (NBSC, 2006). International furniture companies have stepped up their pace of entering into China market to take advantage of the opportunities, company like Air land based in Hong Kong now manufactures foreign brands beddings and mattress for the market, Ashley furniture a major American brand has expanded into China at a major scale, a global f... [tags: Marketing, Strategic management, Marketing plan]
1003 words (2.9 pages)
- Table of Contents Executive Summary 2 Country Profile 2 Political System 3 Legal System 3 Economic System 4 Economy – Status, Stability, Growth 4 Cultural Issues 5 Issues around Ethics 5 International Trade Picture 5 Trade with Australia 6 Foreign Direct Investment 6 Foreign Exchange 6 Works Cited 7 Executive Summary Indonesia’s economy did very well since Asian financial crisis on 1990’s and overturn of Suharto’s autocratic rule in 1998; growing regularly in healthy rate on the back of democratic rule and concrete financial and monetary policy as well as definite future planning.... [tags: Economics, Macroeconomics, Indonesia]
1183 words (3.4 pages)
- Around the globe today, two of the busiest industries are the retail and furniture industry. These industries are directly associated with the basic needs that every human requires. For instance, retailing involves the process of selling services and goods to consumers through various channels of distribution to gain profit. However, this business requires federal laws and regulations to govern both the manufacturers and consumers, to benefit and secure both. This essay is going to discuss the ten laws that affect the furniture industry today; the retailing process, work safety and environmental safety.... [tags: Law, Consumer protection, Consumer, Manufacturing]
1417 words (4 pages)
- 1. Current state of Fast Food Industry 1.1 Current State of the industry Fast food outlets actually have been existed from millennia in China, India and ancient Europe. In the past, many people cannot afford to have a kitchen and this becomes the main reason they buy their food in fast food outlets (Reverse Your Age, 2013). The perception of fast food started to change in twentieth century. The first company that change the culture and perception of fast food was McDonald’s, followed by their future competitors such as KFC, Burger King, Wendy’s, Taco Bell, Pizza Hut and Subway.... [tags: Fast Food Industry Analysis ]
4302 words (12.3 pages)
- Background Indonesia is one of the countries in Southeast Asia, which has the largest land and population in the region. As the third-largest democracy country and the home of the world’s largest Muslim population, they have encountered countless of turbulent negative issues includes: government corruptions, alleviating poverty, obviating terrorism, consolidating democracy after decades of authoritarianism, human rights violations and so forth. Based on Transparency International, they ranked Indonesia 111st out of 180 countries in year 2009 accompanied by Mali and Togo, which have 2.8 Corruption Perceptions Index (CPI) (International Transparency, 2009).... [tags: Informative, Indonesia Demographic, Economy]
1774 words (5.1 pages)
- Nuclear Reactor Vendor Industry Analysis (graphics not available) Industry overview During the first ten years after its commercial introduction in 1956, the growth of nuclear power production was exponential, as would be expected for a new energy source. It then slowed down progressively to 10.9% a year by 1990, and has continued downwards to 1.8% a year in 2005 . It is however expected to rise again in the years to come , mainly because of the rise of the electricity demand worldwide (particularly in rapidly-developing countries), the awareness of the importance of energy security and the need to limit carbon emissions due to concern about global warming.... [tags: Industry Analysis]
1718 words (4.9 pages)
- Furniture in Greenbelt A Sign of the Tough Times A view of the front of a typical housing project in the planned community of Greenbelt. The Greenbelt community was built beginning in 1937 as low income housing for people who were making between $1,200 and $2,000 dollars a year. The houses were built at minimum cost and this means that the rooms are small. Thus special furniture was designed in order to fit into these small houses and to provide sturdy, economical, and good looking furnishings for the new residents.... [tags: Interior Design Furniture Essays]
1104 words (3.2 pages)
- IT Industry Industry Background Information Technology (IT) industry is one of the most robust industries in the world. More than any other industry or economic facet, this industry has an increased productivity, particularly in the developed world, and therefore is a key driver of global economic growth. Economies of scale and insatiable demand from both consumers and enterprises characterize this rapidly growing sector. Both software development and the hardware involved in the IT industry include everything from computer systems, to the design, implementation, study and development of IT and management systems.... [tags: Market Industry Analysis]
1149 words (3.3 pages)