The wood and furniture sector – which in 2022 for the first time crossed the three billion euro mark in exports – is committed to growing another billion by 2025, the year in which it aims to cross the four billion mark. Before that, for this year, the goal is to sell another 400 million euros abroad. Pending approval, the project to support the internationalization of the Associação dos Indústrias de Madeira e Mobiliário de Portugal (AIMMP), which envisages a global investment of €9.7 million, involving around 90 companies in 35 different actions in a dozen markets.
In 12 years, between 2010 and 2022, the sector has almost doubled its exports to EUR 3039 million, with the European Union accounting for 77% of this value. But in the same period, sales to non-EU markets rose from 301 to 701 million and now represent 23% of total sales abroad. And it is here that AIMMP has invested heavily in international promotion, convinced that these are the markets “with the greatest growth potential”. Also because, because the base is low, development is faster.
“In 2021, we took advantage of the pandemic to make a major promotional effort in the Middle East, showing our strength and the capacity of European design. We even organized an exhibition at the Pavilhão de Portugal on Expo Dubai,” explains Vítor Poças. Now the strategy is to strengthen the bet on the United States and Canada, “without leaving the Middle East and always being present on the main trade fairs of the sector in Europe”. The internationalization plan also includes advertising and communication campaigns and a strong focus on digital marketing.
It involves a sector that ranges from forestry to furniture repair, carpentry, panel, packaging and furniture manufacturing, as well as mattresses and brooms, among many other products. According to the latest available data, there are almost 28 thousand companies employing more than 100 thousand employees.
The evolution of design trends, which the Portuguese industry “does so well”, will be one of the levers of growth, says the president of AIMMP. But also “the centuries-old tradition of knowing how to work wood” and the “great versatility” of the offer, since the vast majority of Portuguese industry “consists of companies that are neither very large nor very small, which gives it the flexibility needed to secure custom projects [à medida] and key ready”.
The resource problem
The increased involvement in the North American market stems precisely from the fact that these consumers are “going to discover something they like in European design”, in addition, of course, to the fact that these are large markets with high purchasing power. “Today we export almost 10 times more to the United States than in 2010. It is probably the most consistent growth market in our sector outside Europe”, emphasizes Vítor Poças.
The start of 2023 is also “very positive”, with exports growing at almost 13% year-on-year to 535.9 million euros, but there are issues that worry the sector. Firstly, the problems of the forest and the growing need to import raw materials, but also the lack of qualified workers.
To remedy the problem, the AIMMP is committed to improving the attractiveness of the sector, namely through, on the one hand, the “renewal of the collective bargaining agreement and the improvement of the nomenclature of professions”, and the inclusion “of a range of new professions , such as designers or CNC machine technicians”, in a logic of “appreciating our people”, along with a “great effort” in professional training. Making it clear to young people that they can now use their new digital skills in an industrial sector such as wood and furniture is “essential”.
It is also essential to increase the productivity and competitiveness of the sector. “If you ask me how many workers the industry needs, I’ll tell you it doesn’t need more. What it does need is to increase the size of companies, their technology footprint and their productivity, which increases their competitiveness will increase.” Through improved qualification, automation, digitization and robotization, in short better technological performance,” argues Vítor Poças, who claims a “larger share of public funds” from the Recovery and Resilience Plan (PRR) and from the next Community support framework for the industry .
Salary “Immorality”
In terms of salaries, the AIMMP acknowledges that salaries in Portugal are “generally not good”, but it ensures that “it pays in line with or even above the industry average”.
Vítor Poças still spares no criticism of the tax burden on companies and work. “In Portugal, success is taxed and the poor thing is supported. It is a country that is not at all concerned with the critical factors of the competitiveness of companies and the economy itself,” he says, recalling that a €100 increase in the an employee’s salary represents a cost of EUR 130 for the company and the employee receives only EUR 30 net extra. “It’s immoral,” he says.
Ilídia Pinto is a journalist for Dinheiro Vivo
Source: DN
