Arrears in the furniture industry currently amount to PLN 125.6 million – since the beginning of the pandemic, they have increased by nearly PLN 18 million, according to the data of the National Debt Register (KRD). 70% of this amount is the debt of the smallest companies, i.e. sole proprietors.
“The furniture industry in Poland is very diverse, companies are divided into two groups, the first are large players who mainly produce for export or have their own markets. The second are small companies and plants that sell furniture on the Internet or on a specific order. it is they who have the greatest problems and get into more and more trouble. These small companies are more sensitive to economic fluctuations and payment gridlocks, and the pandemic and the related economic turmoil only worsened their financial situation. Our database contains nearly three thousand of them. sole proprietorships that have to pay over PLN 90 million to creditors, according to president of KRD, Adam Łącki.
On average, one furniture company has approx. PLN 37,600 to be repaid. Companies registered in Wielkopolska have the highest debt – the amount of their debt exceeds PLN 20 million. Entrepreneurs from central Poland have much less to repay – PLN 14 million. The podium of the most indebted companies in the furniture sector is closed by those from Silesia (PLN 12 million). The least indebted enterprises in the furniture sector include companies registered in the following voivodeships: Opolskie (PLN 1.6 million), Podlaskie (PLN 2 million) and Lubuskie (PLN 2.5 million).
“Polish furniture manufacturers are competitive on the foreign market mainly for price reasons. However, the increase in production costs will make domestic products approach the prices of European manufacturers. In Poland, the costs of materials are now up to several hundred percent higher than before the pandemic. Do this is also the cost of transporting components mainly from China, which has also increased in price. According to B + R Studio’s calculations, the price of energy increased by about 60%, and salaries by an average of 16%. All this will have a negative impact on the functioning of the entire sector. with financial background, they will be able to survive this difficult time. Big players also find it easier to negotiate prices with suppliers because they order more and are often in the group of strategic customers. Small entrepreneurs, who usually do not have or set aside funds, are in a much worse situation. money, or arguments for talks about prices,” added the expert of Rzetelna Firma Andrzej Kulik.
Furniture industry companies have the greatest difficulties with paying installments for loans, leasing or insurance. Their liabilities to financial and insurance companies account for 64% of the total debt value and amount to PLN 80 million. Wholesale companies, mainly material suppliers, are second in line after payments. The furniture industry owes them over PLN 11 million. Industrial entrepreneurs are waiting for a refund of PLN 7 million from furniture makers, completed.
Source: KRD and ISBnews
