MOS Teo Ser Luck at the 31st Dinner and Dance of Singapore Furniture Industries Council

SPEECH BY MR TEO SER LUCK MINISTER OF STATE FOR TRADE AND INDUSTRY, AT THE SINGAPORE FURNITURE INDUSTRIES COUNCIL’S 31st DINNER & DANCE ON FRIDAY, 2 NOVEMBER 2012, 8.30PM AT RAFFLES CITY CONVENTION CENTRE

Council Members,

Distinguished Guests,

Ladies and Gentlemen,

Good evening.

I am delighted to join you this evening at the Singapore Furniture Industries Council’s (SFIC) 31st Dinner & Dance 2012.

Introduction

Let me begin by saying that SFIC is a shining example of a Trade Association & Chamber that has proactively built up industry and enterprise competitiveness, strengthened capabilities and helped lead in internationalisation efforts.  Even as we face economic headwinds, our Singapore furniture industry continues to yield positive results, achieving a revenue of approximately $5.62 billion in 2011 – up from $4.69 billion in 2009.

According to the Centre for Industrial Studies (CSIL), an economic research institute based in Milan, the global furniture consumption is forecast to grow at 3.3 per cent, with the Asia Pacific region leading the global market.  You will also be heartened to know that based on SPRING Singapore and SFIC’s 2011 Furniture Industry Survey, over 50 per cent of the Singapore sales market is also in the Asia Pacific region.

We are glad to see that Singapore furniture players have carved out a niche for themselves amid the challenges that abound in these uncertain economic times. The various government agencies such as DesignSingapore Council, IE Singapore, JTC Corporation and SPRING Singapore will continue to work in collaboration with SFIC to assist local furniture companies in strengthening the Singapore brand and boosting our companies’ competitiveness.

Key Initiatives in Place

Last year I had the pleasure to make an industry visit to SFIC and was deeply impressed by the Council’s accomplishments during the past three decades. In its journey to make Singapore the centre for Asian furniture design innovation and international furniture trade, SFIC has put in place a clear blueprint of how to achieve this objective. Several key initiatives were identified and over the next three years, SFIC and its members will focus on marketing, design, environmental consciousness, branding and learning to build and enhance the industry’s competitive advantage.

This evening, I am glad to acknowledge two of SFIC’s main innovative strategies – Green Initiatives and SingaPlural.  First, the Green Initiatives. Recognising the need for environmental sustainability, SFIC has spearheaded various green initiatives to raise awareness of environment issues and compliance. SFIC, its members and various green institutions are working together to promote green furniture production, design and practice and to advance green technologies for the industry. In line with the green initiatives, three furniture companies, Benel Singapore, Wilsin Office Furniture and Harvest Link International, have tapped on SPRING’s QUality for Enterprises through STandards Programme (also known as QUEST) to obtain the GreenGuard Certification for their products. As the GreenGuard certification is one of the most recognised sustainability accreditation in the world, these companies can expect to benefit from greater accessibility to green-savvy markets, such Europe and the US.

2012 also marks the first edition of Green Pavilion, held in conjunction with the hugely successful International Furniture Fair Singapore (IFFS). SingaPlural, the inaugural Singapore Furniture Design Week organised in conjunction with IFFS 2012, also marks another notable milestone for SFIC. It promotes the exchange between local and overseas design talents and provides a creative platform for showcasing their work on the streets of Singapore.

Singapore Brands – Global Reach

The Government is committed to supporting our local furniture entrepreneurs in their overseas expansion. SPRING Singapore’s Furniture Industry Productivity Plan, launched in 2011, will see S$17 million of investments allocated to enhance the industry’s productivity over the next five years. It will focus on growing capabilities in design, branding, international market expansion and people development. The LEAD Programme, jointly administered by IE Singapore and SPRING Singapore, supports the SFIC in strengthening its design, internationalisation, branding and eco-sustainability initiatives for the industry. Plans are also in the pipeline to develop the International Furniture Park in Sungei Kadut, with ready tenants like Sitra, Sunray and Grandwork. Moreover, SFIC is developing its upcoming new centre for design showcase, training and trade by 2015. These initiatives aim to expand Singapore’s market share from about 1 per cent of global market share today to 1.5 per cent by 2015.

To date, more than half of Singapore’s furniture companies have moved their manufacturing bases away to areas which provide cost advantage over their peers in Europe and the Americas. However, this value proposition alone is not sustainable as competition is no longer based on competitive costing but also on knowledge, design innovations and research capital. I am glad that an increasing number of furniture companies are embarking on the route of knowledge, innovation and research, with the support of IE Singapore, SPRING Singapore and DesignSingapore Council. Companies like Air Division, OutofStock, HTL, Koda, Cellini, Kingsmen, Sunray and Grandwork are now making their presence felt in various international platforms.

Take for example, Air Division, a design-centric manufacturer and retailer of minimalist furniture and furnishings under its brands, Air, Plank Living and Royce. The company has been exporting mainly to Europe and the US, but increasingly, it has started to shift its focus to the growing Asian markets. Well-known internationally for its premium, award-winning designs and high- quality products, Air Division was Singapore’s very first furniture company to garner the prestigious Red Dot Design Award (one of the most prestigious and recognisable marks of an international design award in the world today) for product design under Plank Living. 

Some of our companies have also extended their reach to non-traditional markets as far as Latin America. Ewins, a specialist components supplier for kitchen and wardrobe systems, has made successful forays into Brazil and Panama with its flagship brands. These new emerging markets currently contribute to about 20 per cent of Ewins’ annual sales revenue and Ewins is now working towards opening up new markets in Mexico, Chile and Columbia.

Raising Productivity

As we move towards a technology- and knowledge-based society, there is a pressing need to help our workers stay relevant as they are the backbone of our SMEs. The Government, in consultation with industry partners, has implemented various assistance programmes to support our SMEs’ upgrading efforts and their ambition to put Singapore on the global furniture map.
 

An example of such an SME which has innovated to progress is Lorenzo International, an integrated lifestyle furniture retailer that exports to more than 40 countries around the world. As a forward-looking furniture enterprise, the company recently implemented an ERP system across its group level, with the support from SPRING Singapore, to help integrate its regional operations and improve its productivity and efficiency.

Under the Furniture Industry Productivity Plan, various initiatives have also been formulated to raise capability development. One such programme successfully launched by the SFIC Institute is Project Creation – a Workforce Skills Qualifications WSQ apprenticeship programme jointly developed with the Singapore Workforce Development Agency (WDA) and supported by SPRING Singapore and NTUC’s e2i Programme. This course aims to nurture, train and build a pipeline of skilled and certified designers for the furniture industry. By 2016, the SFIC Institute targets to train and certify 1,700 workers through 16 new courses. This increased worker capability will indeed help boost the sustained development of the furniture industry in Singapore.

Conclusion

At this juncture, I would like to take this opportunity to thank all SFIC committee members, staff and all the industry players here for their contributions towards putting Singapore on the furniture world map. Your efforts and dedication have paid off and we are ready to embark on the next chapter of growth – delivering a strong and distinctive brand of Singapore brand furniture to the world.

With the emergence of Asia as an important market and the increasing size of the Asian middle-class, which is projected to account for more than half of the global middle-class consumption by 2030, I urge you to further enhance your business operandi – from “Made IN Asia” to “Made FOR Asia”. Given Singapore’s strong business infrastructure, you are also well-positioned to be a partner for many international brands who are increasingly looking at establishing or expanding their market presence in this part of Asia.

I am confident that with the plans put in place by SFIC and the collaborative efforts of various government agencies involved, we are well on track to shape Singapore into a premier design hub and bring the furniture design levels to the next stage.

In closing, let me congratulate the newly appointed President of SFIC, Mr Ernie Koh, and also welcome the new Executive Committee on board. I believe that their dedication and passion will certainly take Singapore’s furniture industry to greater heights.

Thank you and I wish you all every success in the years to come.