Furniture hardware manufacturing - own business with 30% profitability

Household products. Production and sale Furniture and Decor

Design and manufacture of any type of furniture is directly related to the selection of necessary fittings.

Fittings are relatively simple auxiliary products that are widely used for furniture production. Fittings are understood to be parts or mechanisms that should provide a movable or fixed connection of furniture parts.

As a rule, special technologies are used for their manufacture, significantly different from the technologies of the main furniture production, therefore, the accessories are supplied by specialized enterprises.

Often, investors bypass this segment of the furniture industry with their attention, considering it too small and unattractive for large investments. Meanwhile, furniture fittings include several tens of thousands of items that are used in the manufacture of furniture.

There is an industry standard “ Furniture fittings. General Technical Requirements ”, which contains a classification of hardware products containing more than 100 items.

This includes front and mounting hardware, hinges, ties, magnets, holders for shelves and mirrors, latches, guides, handles, decorative elements, etc. In addition to furniture, various functional and decorative elements (dishwashers, mirrors, etc.), which relate to components for furniture.

For the production of accessories and components, a variety of materials are used - plastic, wood, metals.

Furniture fittings are divided into front (front and connecting) and fasteners. If the component parts are quite expensive in cost and are delivered in individual packaging, then the accessories are much cheaper and are delivered in boxes or boxes of 50 or more units.

The "penny" cost of hardware is very relative. For example, in the cost structure of cabinet furniture, the fittings are 10-12%, in the kitchen - up to 25%, and in upholstered furniture with frame mechanisms - up to 30, or even 40%.

Over the past 3-4 years, the segment of the furniture hardware market has been developing at a fairly rapid pace. Such an increase is associated with the overall favorable development of the furniture industry and Russian furniture production, in particular. These trends are taking place against the backdrop of the processes of replacing imported furniture and materials for the furniture industry with domestic products, an increase in housing construction and a gradual increase in the welfare of the population.

The positive dynamics of furniture production causes a significant demand for furniture fittings. According to official statistics, each year this segment of the market increases by 25-30% compared to the previous year.

Nevertheless, the bulk of the Russian market is still occupied by imported products. This is not surprising, because foreign-made goods outperform domestic counterparts not only in price and quality, but also in assortment.

Most experts are confident that the low competitiveness of Russian hardware is affected by high production costs. Imported products prevail today in almost all segments.

The low price segment is occupied by Chinese and Taiwanese products, and the fittings of German, Italian or Spanish production prevail in the high price segment.

However, in spite of these trends, Russian manufacturers, with the competent use of the changing market conditions, have every chance of crowding out Western competitors and making good profits.

This is greatly facilitated by a significant reduction in prices for the main types of raw materials used in the manufacture of accessories: aluminum, steel, brass, plastic, zinc, etc. At the same time, the cost of shipping imported products increased and, consequently, increased its retail cost. All this had a positive impact on the cost of Russian hardware.

Among the leading domestic companies that produce furniture fittings, one can distinguish Valmaks LLC (Miass), Furniture Fittings LLC (Moscow), Okulovsky Furniture Fittings Plant CJSC, Polimerkomplekt LLC (Kursk) ), ZAO Elektrogorsky Hardware Factory, Izhevsk Furniture Hardware Factory, Ozersky Hardware Company, Boyard and Spectrum.

Although domestic manufacturers are trying to design new models of fittings, improve manufacturing techniques and improve the quality of their products, according to an objective assessment, they are still far from the level of products from leading foreign brands.

Experts believe that the main reasons for this lag:

  • outdated machining equipment of domestic manufacturing plants;
  • tax legislation that impedes the development of enterprises and the renewal of its fixed assets;
  • high cost of new equipment;
  • low quality of domestic materials;
  • lack of skilled workers;
  • lack of relevant regulatory and technical framework for standardization of this type of product and quality control.

And yet, the production and sale of furniture hardware is a lucrative business. The competition in this market is quite high. But new players have every chance to take their place in a certain segment.

The main development trend of the industry is the transition to the production of prefabricated furniture for MDF and particleboard. Accordingly, it is better to start your own business with the production of accessories for such furniture.

All Russian factories producing furniture fittings can be divided into several types. The largest enterprises with more than a thousand workers produce their own expensive equipment.

The sale of finished fittings is carried out in bulk through a dealer network or factory sales department. Such companies supply large furniture factories and shops selling furniture fittings.

Medium-sized enterprises have between 400 and 1, 000 employees. As a rule, these are highly specialized manufacturers that produce products for various purposes.

Often they collaborate with large furniture chains. Most of the hardware they produce is manufactured for a particular company, and only small parties enter free market circulation. They also use modern equipment and are highly flexible in production.

Small enterprises, whose staff is from 40 to 400 people, are mainly focused on the production of a wide range of products for retail, small wholesale, or on order. In such factories, not always new, but still universal equipment is used.

The production equipment in a minimal set includes a bending machine (semiautomatic device), a milling machine, a turning, drilling and thread rolling machine.

To place the equipment you will need a production area of ​​80 square meters. m and ceiling heights from 3 m. In addition, storage facilities are needed for storing raw materials and finished products.

Best of all, if the plant can fulfill not only multi-run streaming, but also individual orders. The ability to produce single samples is often the main condition for the cooperation of the manufacturer with large furniture manufacturers.

Since the decision on the serial production of accessories is made on the basis of trial samples, the possibility of producing such is a good competitive advantage. The stages and technologies for the production of accessories depend on the specific order and type of product.

Initially, a sketch of future furniture fittings is created on a computer using a special drawing program. Then, after making the necessary changes and approving the appearance of the part by the customer, a drawing is drawn up, which is then transferred to the production workshop. Here the fittings are manufactured using various technologies, depending on the material used.

Initial costs for the organization of its own production workshop will amount to 10 million rubles. and higher, depending on the planned production volumes, assortment, number of employees.

Additional costs for the purchase of the first batch of raw materials - from 3 million rubles.

This business area is characterized by an average level of risk. But it is worth considering the possible failures. For example, a refusal to provide lease of already leased premises, problems with equipment (especially if you are not buying new equipment and / or equipment of domestic production), a failure to supply raw materials or receiving raw materials of unsatisfactory quality.

As for the last two types of risks, domestic materials are usually of poor quality. In order to reduce the risk of losses due to interruptions in the supply of raw materials and production downtime, it is necessary to have a certain stock of materials in the warehouse.

In the segment of furniture sales, there are several sales channels for finished products. First of all, these are large and small dealers.

In this case, the sale of goods is carried out either directly from the factory or through its official dealer. The latter option is less common, since at most small enterprises operating on a city-wide scale, the dealer network is usually not very developed. In this case, the plant and its customers are more profitable to work with each other directly.

The average assortment of a product group with small volumes of production is from 500 articles with a clear division into price segments (medium / economy and high).

Profitability is estimated at about 30%. The average payback period when organizing own production from scratch is 3-4 years, when buying a ready-made business - from 1.5 years.

Sysoeva Lilia

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