Rattan and Metal Home Furnishing Industry in Anxi County Finds Its Way to Success
Anxi County is the largest place of production and export base of rattan and metal home furnishing products in China. More than 90% of output is exported to the United States, the European Union, Australia, the Middle East and more than 50 other countries in the world. It finds its way to success for its better design and use of new materials.
Development of local rattan and metal home furnishing industry
Anxi County is part of Quanzhou City in Fujian Province, with a population of over 1 million. Rattan and metal home furnishing manufacturing is the largest manufacturing industry in Anxi County. It is also the largest place of production and export base of rattan and metal home furnishing products in China. More than 90% of output is exported to the United States, the European Union, Australia, the Middle East and more than 50 other countries in the world.
The annual export value of rattan and metal home furnishing products in Anxi County is estimated at over $400 million. This accounts for about 40% of the total export value of these same products in China. In Anxi County there are more than 400 manufacturers and trading companies, as well as over 3,000 workshops and 140,000 people working in the rattan and metal home furnishing industry.
Over the past two years, among all the traditional manufacturing industries in Quanzhou City, the rattan and metal home furnishing industry in Anxi County has seen the greatest rate of increase in terms of export unit price. According to Quanzhou City custom statistics, in the first half of 2013, the rattan and metal home furnishing industry in Anxi County recorded an export value of $184.6 million. This is an increase of 19.96% over the same period last year. Export unit price has increased some 30%, from $4.3 in 2011 to $5.8 in 2013.
Why has the unit price raised so much? “It’s because lots of local enterprises have invested a lot more in product design, in order to raise the added value of their products”, said Chen Minghui in a recent press release. He is chairman of the Anxi County rattan and metal home furnishing industry association.
Famous local rattan weaving artisan Chen Qinghen (right) during a couching section
Like other traditionally labor-intensive manufacturing industries, the rattan and metal home furnishing industry in Anxi County is challenged with greatly increased labor costs, raw material costs and the appreciation of RMB. This comes after more than a decade of rapid growth.
The combination of these factors together boost production costs dramatically while wholesale prices remain merely changed, thus greatly reducing manufacturers’ profit margins. The rattan and metal home furnishing industry in Anxi County reacted quickly and took different approaches to make its way out.
Better product design
Firstly, many manufacturers chose to focus more on product design. Xintangxin Company employed multiple designers from Australia and introduced new design technologies, thus greatly reducing materials used for each product and cutting costs. Fuhua Company tried a mix and match design using wood and sheet iron to create decorative pieces that sell like hot cakes. Jufeng Company, on the other hand, invested over $1.7 million to modify their production line which enables them to produce more innovative products.
Mr. Tang, president of Xintangxin Company pointed out that “our flagship products are the flowery wall décor lines, which took up to 3 kg of iron as raw material for each piece. It is amazing that after redesigning by our Australian designers, not only the iron used for each piece has been reduced to 1.3 kg, but also the products look more beautiful and have become more popular.” The export unit price has also risen from $7 to $13.
Use of New Materials
Manufacturers of rattan and metal home furnishing industry in Anxi County are also making a move to incorporate with other local industries to gain competitive advantages and raise product added value. For instance, products with LED lights have become trendy because they are decorative as well as functional and environmentally friendly.
In 2012, Sanan Optoelectronics and other LED manufacturers expanded their business into Anxi County and built new manufacturing plants there. Local rattan and metal home furnishing manufactures took this wonderful chance to fully cooperate with their new partners to bring LED lights to rattan and metal home furnishing products. These have become highly favored by overseas buyers after being displayed at the Jinhan Fair.
Over the past 3 decades, rattan and metal home furnishing manufacturing in Anxi County has gone through several stages in terms of materials. In the beginning, rattan was the only material used. In the second stage, metal, specifically iron, was brought into production in combination with rattan. Later on, other materials such as wood, ceramics, glass, resin and fabrics were introduced as alternatives. Thus, products became more diversified. All these changes brought vitality to the rattan and metal home furnishing industry and have led to success.
With the help of LED lights, insiders tend to be optimistic about the future of the rattan and metal home furnishing industry in Anxi County. General manager Li Xueming of Anxin Company stated that decorative pillar products used to be sold by weight. After they redesigned their pillars and added LED lights, the set price for 4 pillars raised 142% from $6,600 to $16,000. “It is incredible how much added value LED lights can bring,” said Li.
“LED lights helped raise the unit price of our rattan and metal home furnishing products dramatically, which also raised our profit margin,” said Huang Lianfu, general manager of Jufeng Company. “Our next step is to cooperate with our overseas customers to develop more hot selling products for overseas markets.”
The rattan and metal home furnishing industry in Anxi County aims to develop into an innovative cultural industry. In the first Quanzhou City innovative and cultural industry exhibition, the pavilion of Anxi County rattan and metal home furnishing industry drew a great deal of public attention.
It all started with the challenges brought about by a sluggish global economy to the export of rattan and metal home furnishing products. In order to help local manufacturers survive the recession, Anxi County government conducted extensive market research targeting major rattan and metal home furnishing markets abroad. The research proved to be successful and not only helped local manufacturers to identify customer needs and preferences, but also provided solutions for manufacturers to further develop their business.
Anxi County government also cooperated with local manufacturers to invest in and establish 4 high level specialty research institutes and another 16 corporate research centers. After that, lots of professional designers were recruited to help manufacturers develop new products. Currently, the rattan and metal home furnishing industry in Anxi County develops over 10,000 new products annually according to the latest market needs and trends.
Moreover, Anxi County government also promoted many new policies, including special support funds, patent applications, supporting enterprises to attend various international and domestic tradeshows and other stimulating acts to help local industry to grow and transform.
“Despite sluggish global economies, rattan and metal home furnishing industry in Anxi County has found its way out by improving product designs, increasing added value and focusing on differentiations”, said Chen Minghui.
The success of Anxi County is an excellent example for other traditional labor intensive manufacturing industries that struggling in global economic crisis.