Furniture Sector in Pakistan

Conceptually, the Pakistani furniture industry may want to consider their world competitors through the level the global flows of wood and also non-wood fibres in a larger system of forest industries. It shows, for example, the relative importance of wood from various sources (types of forests) and it shows where the significant flows on non-wood fibres come into the industry’s system. It also attaches the furniture industry to the downstream processing where close linkages can be made to the builder’s joinery, carpentry and pre-fabricated houses, etc. In the processing and distribution chain, added value is multiplied at each phase of further processing. For this reason, the national trade plans and strategies of timber-producing countries tend to put emphasis on the exports of high value-added products such as joinery and furniture.

The comparative advantage derived purely from resource endowment declines as the degree of processing increases. The economies of scale tend to behave similarly, i.e. the higher the degree of processing, the less there is dependence on plant size as a factor of cost competitiveness. Typically, the relative importance of small and medium-sized enterprises (SMEs) is high in furniture, and they play a key role in satisfying domestic demand. Being labour-intensive, small-scale enterprises tend to make a positive contribution to the general socio-economic development. Industrial policies should recognise the strategic importance of SMEs as a source of employment and income.