The globalization of furniture industries/markets

The globalization of industries and markets represents a key trend of the last decade. This evolutionary process, anticipated to become more prevalent in the future, requires long-term strategies whereby firms, industries and nations utilize competitive advantage to expand beyond domestic borders. In order to remain competitive, manufacturers of industrial and consumer goods must address the threats of both domestic and foreign origin and, increasingly utilize a global context for strategic planning, operations and marketing. Global communications and transportation technologies for electronic data interchange, materials resource planning, international finance, management and marketing have enhanced the ability of firms to operate internationally and offer true world brands.Furniture is an example of a product that naturally lends itself to internationalization in that it performs the same basic function across geographic areas and cultures such as seating, bedding, dining, storage and display. Moreover, the use of international furniture and woodworking machinery shows rapidly diffuses new technologies and designs through the global marketplace. Wood furniture represents a prime example of a U.S. industry that has felt the competitive pressures of market globalization. In 1978, imports claimed only 6.6% of the U.S. consumption of wood household furniture. By 1990, they had reached nearly 25% of consumption. The secondary wood manufacturing industries in the United States, including wooden furniture, have been largely insulated from foreign competition due to their established position within the domestic market, abundant and high quality raw materials with high consumer acceptance and appeal and certain transportation barriers as associated with relatively high volume to value items. However, as the international competitive arena changes, manufacturers, industries and nations must reevaluate their future strategies in terms of the forces shaping competitioa This paper presents a framework based upon a multitude of factors affecting competitive advantage in the global context using a furniture industry example. These considerations may be categorized into six domains: (1) raw material supply: (2) production/technology; (3) design and marketing; (4) related/supplying industries; (5) home country demand; and (6) government influence on trade. Global strategic options are then briefly addressed as they pertain to the wood furniture industry. The synthesis of key strategic inputs combined with a global involvement strategy may provide insight not only to wood furniture, but to many other industries attempting to cope with similar changes as evolutionary momentum builds toward global markets, consumers and competition.