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DEVELOPMENT OF THE FURNITURE INDUSTRY IN SABAH Presented by: Emmeline Patrick Department Of Industrial Development And Research Sabah

DEVELOPMENT OF THE FURNITURE INDUSTRY IN … sabah pn. emmeline.pdf · Small and Medium Enterprises ... Sdn Bhd which is also located in Kota ... level to assist in the development

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Page 1: DEVELOPMENT OF THE FURNITURE INDUSTRY IN … sabah pn. emmeline.pdf · Small and Medium Enterprises ... Sdn Bhd which is also located in Kota ... level to assist in the development

DEVELOPMENT OF THE FURNITURE INDUSTRY 

IN SABAH

Presented by:Emmeline PatrickDepartment Of Industrial Development And Research Sabah

Page 2: DEVELOPMENT OF THE FURNITURE INDUSTRY IN … sabah pn. emmeline.pdf · Small and Medium Enterprises ... Sdn Bhd which is also located in Kota ... level to assist in the development

Formed in 1977 by a State Cabinet directive and placed under the jurisdiction of the Ministry Of Industrial Development.

Responsibility of promoting and coordinating industrial development in Sabah.

The mission of the department is to promote development through planning and research, investment promotion and provision of industry services.

Background of Department Of Industrial Development And Research Sabah

Page 3: DEVELOPMENT OF THE FURNITURE INDUSTRY IN … sabah pn. emmeline.pdf · Small and Medium Enterprises ... Sdn Bhd which is also located in Kota ... level to assist in the development

1. To promote foreign and domestic investment in Sabah, especially in the manufacturing sector.

2. Undertake research/studies on the economy of Sabah, mainly on the manufacturing sector

3. Process manufacturing licence and approval to set up manufacturing projects in Sabah

4. Assisting in solving problems faced in the implementation of investment projects

5. To carry out activities/programme to enhance capability of Small and Medium Enterprises (SME)/Small and Medium Industry (SMI)

Main functions of DIDR:

Page 4: DEVELOPMENT OF THE FURNITURE INDUSTRY IN … sabah pn. emmeline.pdf · Small and Medium Enterprises ... Sdn Bhd which is also located in Kota ... level to assist in the development

Sabah Industrial Master Plan

Formulated in 1995.

Create  a  knowledge  intensive  and  competitive  industrial sector based on the clustering concept.

MANUFACTURING SECTOR IN SABAH

Page 5: DEVELOPMENT OF THE FURNITURE INDUSTRY IN … sabah pn. emmeline.pdf · Small and Medium Enterprises ... Sdn Bhd which is also located in Kota ... level to assist in the development

The State's major industrial development strategies spelt out in the SIMP consist of:

Provision of basic infrastructure facilitiesCreating higher order of production, including; 

Industrial clusters; Human Resource Development; Research & development

Industrial Development strategies 

Page 6: DEVELOPMENT OF THE FURNITURE INDUSTRY IN … sabah pn. emmeline.pdf · Small and Medium Enterprises ... Sdn Bhd which is also located in Kota ... level to assist in the development

Resource‐based  industries  that  have  been  identified by  the  SIMP  as  having  comparative  advantage  for development and promotion include:1. Wood‐based industry2. Palm Oil industry3. Cocoa industry4. Processed‐food industry including meat, marine 

products, dairy food, vegetables and fruits.

Targeted Industrial Sectors

Page 7: DEVELOPMENT OF THE FURNITURE INDUSTRY IN … sabah pn. emmeline.pdf · Small and Medium Enterprises ... Sdn Bhd which is also located in Kota ... level to assist in the development

Contribution of the manufacturing sector to the State's GDP

Page 8: DEVELOPMENT OF THE FURNITURE INDUSTRY IN … sabah pn. emmeline.pdf · Small and Medium Enterprises ... Sdn Bhd which is also located in Kota ... level to assist in the development

NO INDUSTRY 2007 2008 2009 2010 2011 2012

1 Basic & Fabricated Metal Products 81 87 87 90 91 94

2 Beverage Industries 23 23 23 23 23 23

3 Biomass 10 11 12 12 12 12

4 Chemical & Chemical Products 39 44 49 49 53 53

5 CPO 86 86 86 87 87 87

6 Electrical & Electronic Products 8 8 8 8 9 9

7 Food Manufacturing 213 216 220 222 223 224

8 Furniture & Fixtures 39 39 39 39 42 45

9 Miscellaneous Industries 14 14 14 15 15 15

10 Non‐Metallic Mineral Products 62 62 64 65 66 66

11 Paper, Printing & Publishing 26 27 28 28 28 28

12 Petroleum Products 11 11 11 11 12 12

13 Plastic Products 59 60 61 64 65 65

14 Rubber Products 13 13 13 14 14 14

15 Textile & Textile Products 4 4 5 5 9 10

16 Transport Equipment 44 45 46 49 51 51

17 Wood & Wood Products 224 227 228 229 230 230

TOTAL 956 977 994 1010 1030 1038

Sabah's Manufacturing Structure

SOURCE: DEPARTMENT OF INDUSTRIAL DEVELOPMENT AND RESEARCH

Page 9: DEVELOPMENT OF THE FURNITURE INDUSTRY IN … sabah pn. emmeline.pdf · Small and Medium Enterprises ... Sdn Bhd which is also located in Kota ... level to assist in the development

Status of the outdoor garden furniture in Sabah

Generally  in  Sabah,  outdoor furniture  is  referred  to  as garden furniture. 

Most furniture  manufacturers are  using  Acacia  (plantation timber)  to  produce  garden furniture. 

Based  on  DIDR's  database, there  were  18  manufacturing companies  for  garden furniture  approved  as  of  July 2012.

Page 10: DEVELOPMENT OF THE FURNITURE INDUSTRY IN … sabah pn. emmeline.pdf · Small and Medium Enterprises ... Sdn Bhd which is also located in Kota ... level to assist in the development

Of  these,  5  companies  are currently  operational.  Most  of these  factories  are  located  in Kota  Kinabalu  Industrial  Park, Menggatal

A new player  in the  industry  is Cosmopolitan Wood  (Sabah) Sdn Bhd which  is also  located  in Kota Kinabalu  Industrial  Park.  Started operation in 2011.

Page 11: DEVELOPMENT OF THE FURNITURE INDUSTRY IN … sabah pn. emmeline.pdf · Small and Medium Enterprises ... Sdn Bhd which is also located in Kota ... level to assist in the development

Source:  Sabah Forestry Department

The Export of garden furniture slowed down in 2010.  However, in 2011 the export of garden furniture increased to 24,894.3 m/t from 10,752 m/t in 2010.  Major importing countries are United Kingdom, Germany and Italy.

EXPORT OF GARDEN FURNITURE, M/T( 2009‐2011 )

2009 2010 2011

16,136.4483 10,751.9876 24,894.3271

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Initiatives by Ministry Of Industrial Development

Integrated Timber complexes in Seguntor, Sandakan (5,856 acres) and Sungai Imam, Tawau (460 acres) in 1990s.

Kota  Kinabalu  Industrial  Park  in 1995  in  Menggatal,  covering  an area  of  3,679  hectares.  Out  of these, 1,627 hectares are developed for industrial zones.

Promotion  of  the  outdoor furniture in international market in a  smaller  scale  through participation  in  international furniture fairs. 

Page 13: DEVELOPMENT OF THE FURNITURE INDUSTRY IN … sabah pn. emmeline.pdf · Small and Medium Enterprises ... Sdn Bhd which is also located in Kota ... level to assist in the development

MID’s PERSPECTIVE‐MOVING FORWARD

For any  industry  to grow,  it will have  to produce products based  on  design  innovation, specialized  niche  product segments  and  marketing efforts  which  eventually  lead to  own  brand  names  and reputation. 

Page 14: DEVELOPMENT OF THE FURNITURE INDUSTRY IN … sabah pn. emmeline.pdf · Small and Medium Enterprises ... Sdn Bhd which is also located in Kota ... level to assist in the development

Strong  focus  on  design  and  niche products. Important  for  Sabah  furniture manufacturers  to  find new ways of marketing  and  promoting  their products.Need  to  create an  identity  for  their products  and  services  locally  and abroad  by  differentiating  through branding. Furniture manufacturers should also target  niche  markets  to  sell  their products at a premium prices.

Page 15: DEVELOPMENT OF THE FURNITURE INDUSTRY IN … sabah pn. emmeline.pdf · Small and Medium Enterprises ... Sdn Bhd which is also located in Kota ... level to assist in the development

Manufacturers need  to  invest  in R&D  and  value‐add their products  to produce  creative  furniture designs that  reflect  aspirations,  fashion  and  latest  design technology.

Sabah  outdoor  furniture  should  be  promoted  not merely as a product for general usage but as a piece of art.

Page 16: DEVELOPMENT OF THE FURNITURE INDUSTRY IN … sabah pn. emmeline.pdf · Small and Medium Enterprises ... Sdn Bhd which is also located in Kota ... level to assist in the development

Companies intending to design, develop and produce wooden  furniture  and  companies  embarking  into Research and development of products are eligible  for consideration  of  Pioneer  Status  and  Investment  Tax Allowance  .  Applications  for  incentives  should  be submitted to MIDA.

Page 17: DEVELOPMENT OF THE FURNITURE INDUSTRY IN … sabah pn. emmeline.pdf · Small and Medium Enterprises ... Sdn Bhd which is also located in Kota ... level to assist in the development

Although  the government has a clear  role  to play  in industrializing  Sabah,  the  private  sector  is  expected to take this lead role in charting the business path. 

The Ministry will continue to work together with the other Government agencies  in  the Federal and State level  to  assist  in  the  development  of  the  furniture industry in Sabah.

CONCLUSION

Page 18: DEVELOPMENT OF THE FURNITURE INDUSTRY IN … sabah pn. emmeline.pdf · Small and Medium Enterprises ... Sdn Bhd which is also located in Kota ... level to assist in the development

Thank You