GUANGZHOU, Jan. 10 (Xinhua) -- China's furniture industry, a cornerstone of global home goods supply chains, is grappling with unprecedented challenges amid a sluggish real estate market, corporate upheavals, and export pressures. However, the sector is also embracing a critical transformation driven by green manufacturing, intelligent upgrades, and strategic globalization, with domestic consumption and industrial innovation emerging as key pillars of resilience, according to latest industry data and enterprise practices.
The industry is currently mired in a period of profound distress. A string of high-profile incidents has laid bare its vulnerabilities: senior executives of leading enterprises such as Easyhome and Red Star Macalline have faced legal probes or unexpected passings, while major home improvement firms including Liangjiaju and Zhufaner have collapsed due to capital chain crises or project shutdowns 1. Economic indicators paint a grim picture: in the first quarter of 2025, revenue of large-scale furniture enterprises in China fell by 2.2% year-on-year, with total profits plummeting by 40.1% and the operating profit margin dropping to a decade-low of 2.5% 1. The slump is largely attributed to the ongoing adjustment in the real estate sector, as national residential completion area has seen consecutive negative growth since 2021, stripping the furniture industry of its core growth engine 1.
Export markets, a vital lifeline for many Chinese furniture makers, are also under strain. Data from the China National Furniture Association shows that from January to September 2025, China's furniture exports reached 50.177 billion U.S. dollars, a year-on-year decrease of 4.6%, amid rising global trade barriers and fluctuating supply chain costs 4. The U.S., a key export destination, has tightened trade policies, with over 60% of enterprises reporting surging transportation costs due to tariff hikes5. To mitigate risks, some firms have resorted to splitting large orders into smaller batches to avoid tariff thresholds, while others are exploring localized production in regions like India 5. Despite this, Zhejiang, Guangdong, and Shandong remain the top exporting provinces, accounting for over 60% of the country's total furniture exports 4.
Amid the turmoil, green transformation has become a beacon of hope for the industry. Nankang District in Ganzhou, known as "China's Solid Wood Furniture Capital," is leading the charge in eco-friendly upgrades by promoting water-based paint technology and phasing out traditional oil-based paints 3. Local enterprises like Fulong Crown have invested in digital and environmentally friendly production bases, where robotic arms apply water-based paints to create "zero benzene, zero formaldehyde" products that meet strict global environmental standards 3. Supported by government subsidies covering up to 20% of renovation costs for spraying and drying systems, Nankang's water-based paint furniture transactions exceeded 30 billion yuan in 2024, with products exported to over 20 countries including Japan and the UAE 3.
Innovation in production models and product development is also driving industry resilience. Faced with land shortages, Nankang has pioneered the "industrial upward" model, encouraging enterprises to build high-rise factories to maximize land use efficiency3. Fulong Crown's 8-story "vertical factory" integrates woodworking, painting, and upholstered furniture production across different floors, achieving a floor area ratio of 4.0 and slashing production cycle times 3. As of 2025, 17 such pilot projects have been launched in Nankang, covering 1,100 mu of land and providing 2 million square meters of factory space 3. Meanwhile, leading enterprises are deepening the integration of "factory + cross-border e-commerce," with inventory turnover efficiency improving by 35% and product development cycles shortening from 9-12 months to 4-6 months 2.
Domestic consumption has emerged as a crucial bright spot, offsetting some export pressures. From January to August 2025, retail sales of furniture products by designated large enterprises in China increased by 22.0% year-on-year, significantly outpacing the overall growth of social consumer goods 6. This growth is driven by the rising demand for home renovations in the secondary housing market, which now accounts for 40% of the home improvement market 1. To tap into this potential, enterprises are shifting from single-product sales to standardized whole-home customization services, aiming to solve the mismatch between supply and demand in the traditional fragmented business model 1.
Industry experts caution that the sector is entering a period of accelerated differentiation. Ding Shaojiang, an industrial economist, predicts that leading enterprises will expand against the trend through service-oriented transformation, while small and medium-sized stores will be phased out at an accelerated pace 1. Compliance and refined operations will become the key to survival 1. Looking ahead, the furniture industry will focus on three core directions: deepening green manufacturing to meet global environmental standards, promoting intelligent upgrades to improve production efficiency, and optimizing global supply chain layout to enhance risk resistance. Enterprises that can grasp the opportunities of domestic consumption upgrading and technological innovation are poised to emerge stronger from the current turmoil.
