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Research Report

Making research work for small-scale furniture makers: Action research in the Jepara furniture industry, Indonesia

Herry Purnomo
Bayuni Shantiko
Copyright Date: Jan. 1, 2013
Pages: 131
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Table of Contents

  1. (pp. 1-22)

    The global furniture market connects people and organisations from countries across the world (Purnomo 2006). In 2011, the world’s biggest furniture exporters were China (export value US$44.8 billion), Germany (US$13 billion), Italy (US$11.5 billion), Poland (US$9.3 billion) and the USA (US$6.4 billion) (UNcomtrade, 2013). Among Asian countries, China has the biggest share of the global furniture export market, with 16.07%, followed by Malaysia (2.91%), Indonesia (2.55%), Taiwan (1.69%) and Thailand (1.47%) (USAID-SENADA 2007). In 2011, the world’s biggest furniture consumer was the USA (US$35.2 billion), followed by Germany (US$14.3 billion), France (US$8.9 billion), the UK (US$7.4 billion) and Japan (US$6.3...

  2. (pp. 23-36)

    OECD imports of wooden furniture reached a total value of more than US$32 billion in the early 2000s, compared with about US$26 billion in the mid-1990s. The absolute annual growth in the import value is 6%, with the most stable growth segments being wooden bedroom furniture, ‘other’ wooden furniture (that destined for living/dining rooms, shops, miscellaneous uses) and wooden seats (IFC 2005 in Nurrochmat et al. 2009). The USA is the largest market for wooden furniture (purchasing 33% of all OECD imports, to the value of US$10.7 billion), followed by Germany (US$3.3 billion), France (US$2.6 billion), the United Kingdom (US$2.3...

  3. (pp. 37-48)

    The estimated timber demand for Jepara’s entire furniture industry is 862 056 m³ per year (Achdiawan and Puntodewo 2011). Annual growth in demand is expected to follow the growth of the furniture industry, which is at around 7% per year (Achdiawan and Puntodewo 2011). With 82% of furniture workshops specialising in the domestic market, timber demand is expected to further increase, given that small-scale furniture industries are shifting away from compliance with international market demands to concentrate on meeting the needs of the domestic market (Achdiawan and Puntodewo 2011; Yovi et al. 2012).

    Small businesses in particular are highly dependent...

  4. (pp. 49-60)

    As small-scale furniture manufacturers often face major problems related to marketing, capital and wood acquisition, Purnomo et al. (2009) proposed a strategy that targeted actors along the horizontal dimension of the value chain. As part of this approach, the project facilitated the formation of the Jepara Small-scale Furniture Producers Association (APKJ), which helps its members to become independent and competitive and strengthens their bargaining position in the global market.

    The presence of this collective organisation will make it easier to implement other strategies that aim to address vertical dimensions of the value chain (see Chapters 2, 3 and 5). Members...

  5. (pp. 61-68)

    Major obstacles encountered by small-scale furniture manufacturers in Jepara include obtaining raw materials, ensuring product quality, marketing products and sustaining business capital. These four problems are very much interconnected and need to be addressed simultaneously.

    Fluctuations in timber prices make it difficult for small-scale manufacturers to purchase good-quality timber, which affects product quality. Many producers opt for cheaper, low-quality timber from younger trees, which compromises the sustainability of timber sources (FVC Team 2011e).

    Furthermore, most small-scale manufacturers market their products not to end consumers but mainly to middlemen, wholesalers, big furniture companies or exporters. With no set standards for product...

  6. (pp. 69-98)

    We carried out a 10-year projection (2013–2023) for Jepara’s furniture industry to forecast future outcomes in the case of a business-as-usual scenario.

    Industrial demand for timber in Jepara was recently calculated to be 864 771 m³, with 24% annual growth (Achdiawan and Puntodewo 2011). At this rate, Perhutani, which supplies 85% of the Jepara region’s timber, will be able to fulfil only 1% of demand by 2030. To avert future shortages, fast-growing timber species have been planted throughout the region. Even with these plantations, however, the total potential volume of teak throughout Jepara will not be able to meet...