The Challenges Faced By Malaysian Furniture Retailers

We stand on the brink of a technological revolution that is fundamentally shifting the way we live, work, and relate to one another. With it comes the shared notion that traditional retail may be burning out, making way for the likes of e-commerce.

Retailers in all industries are facing multiple problems in driving footfall and sales in brick-and-mortar setups. This is especially evident in the furniture industry, where competition seems to be coming from all directions. Lack of manpower, demand and looming threats of online retailers are closing in on traditional furniture retail.

The Upside To The Local Furniture Industry

Karen Goi, the general manager of Malaysian International Furniture Fair (MIFF), thinks the trade war between the U.S and China is good news for Malaysia.

This point of view comes from the fact that U.S furniture buyers and traders are outsourcing timber from other countries.

Although U.S – China trade tensions generally have a negative effect on trade in Asia, the prospects look good for Malaysia’s furniture industry, as they have the right infrastructure in place to offer their services.

Furthermore, Teresa Kok, the Primary Industries Minister, believes that the local furniture industry will be able to achieve their target of RM12bil in export earnings by this year.

So the question remains – in the midst of the retail apocalypse where brick-and-mortar stores are closing left, right and center, how are furniture retailers fairing?

Surprisingly, retail aspects of Malaysia’s furniture industry seem to be thriving in these uncertain times. Just last month, Ashley Furniture HomeStore opened up their largest flagship store in Kuala Lumpur’s Quill City Mall – affirming the demand for furniture within the consumer space.

Challenges That Smaller Retailers Are Facing

As it is, the Malaysian furniture industry is the country’s fastest growing sub-sector within the wood-based industry. Although the government has made significant strides in providing a broad policy framework to support value-adding and innovative activities, challenges are still aplenty for smaller players on the front-line.Here are some of the challenges faced by Malaysian furniture retailers:

1. Digital Competition Prevails

Digital retail remains the go-to for retailers in almost every product-centered industry.

Perhaps the most prevalent threat to any retailer is the emergence of e-commerce. Although the furniture industry is thriving in a global space, smaller retailers are facing the “adapt or die” circumstance.

Those without the budget to move into digital retail may find themselves unable to compete with others who can.

Online stores like Grab It! and FURNITUREdirect are providing Malaysians with a large catalogue of furniture and home items that cost less and are more accessible.

Why scout physical stores, or even take the effort to go to IKEA when your furniture needs can be met from your smartphone? Major stores like Courts are adapting to the trend and making sure they stay relevant by starting their own e-commerce platforms. 2.

2. Fluctuating Customer Demand With Millenials [restrict]

Millenials tend to have erractic consumer patterns that make it hard for older markets to thrive.

Unlike their Baby Boomer predecessors, millenials are becoming increasingly hard to pin-down or profile as customers.

Many are choosing to settle down later in life. Many more are unable or do not want to purchase houses, choosing to rent instead. This trend extends its implications to furniture retailers, where furniture demand amongst the current population tends to be unpredictable.

It has become impossible to focus on a niche, such as furniture just for homes. Online platforms have taken a broad approach in retailing furniture, where home furniture is only a sub-section within their variety of products.

3. Skilled Labor Continues To Be A Boon

A shortage of skilled labor continues to plague the retail industry as a whole.

With technology comes automation, decreasing the need for laborers and workers. Despite this, industries all over Malaysia are facing a shortage of laborers.

But this is the back-end of the furniture industry right? So why should retailers worry?

Simply put, a greater demand for skilled labor means higher wages to afford them. Higher wages means increased overhead costs – eventually influencing retail prices on furniture.

In these stiff economic times, getting consumers to spend is already a challenge. With cheaper options available, front-end retailers will be seeing many of their customers shifting over to online platforms for more affordable options.


In a nutshell, the furniture industry continues to thrive globally, but the local market is moving in a way that calls for a change. A large challenge that furniture manufacturers face is their inability to appeal to the younger generations – those who can be targeted as future customers.

As with most other types of manufacturing sectors, advanced technologies will also become a common implementation into the making and distribution of furniture. This may help to alleviate some of the issues, but it’s hard to say whether it will be enough for smaller retailers.

Actionable Takeaway:

For product-centered retailers, moving onto digital retail and e-commerce is the next step in business survival. Even if it is something as simple as setting up a website and driving traffic to your business from there, it takes a bit of know-how and resourcefulness. The key is to watch out for others who have done it, then take it step-by-step in a way that works best for your business. To learn a little more on the topic, click here to read on How These 5 Shoe Brands Leveraged Digital Marketing To Build Their Business.



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