2014-06-11

The power behind “SBA” Furniture Group – investments of LTL 300m

LTL 41m is the amount “SBA” Furniture Group plans to invest into the factories it manages. “In our business, constant investment is essential – only this way we may increase the scope of our manufacture and the effectiveness of our activities as well as successfully compete in the world markets”, Egidijus Valentinavičius, the vice-president of “SBA” and the chairman of the “SBA” Furniture Group board, says.

Although the total export of Lithuania dropped by 10.5% in the first quarter of this year, furniture industry remains one of the major country’s powers in foreign trade. Experts associate this sudden drop in export with the poor performances of “Orlen Lietuva” and “Achema”. Meanwhile, export sales of “SBA” Furniture Group during the same period have peaked by 8%.

The “SBA” Furniture Group sales grew steadily since 2009 and by the year 2013 they reached LTL 689.2m, 56% more than in 2009, when the sales amounted to LTL 441m. These results were largely influenced by the funds invested into enterprises, which in turn allowed the increase of manufactured products and simultaneously decreased expenditure and increased effectiveness of activities.

In the recent three years “SBA” Furniture Group investments into enterprises exceeded LTL 150m, whereas since 2006 enterprises received more than LTL 300m worth of investments. “We invested in the constructions of new factories as well as reconstructing the old ones and installing new lines. Basically, we reorganized both manufacturing processes and management”,the chairman of the “SBA” Furniture Groupboard says.

What positive result invested millions may bring about, E. Valentinavičius illustrates with an example of “Klaipėdos baldai” company; since 2006 factory’s scope of manufacture has almost doubled – it has risen by 96%. “This result was achieved not by expanding the area of manufacture, but by effectively exploiting the potential of current technologies”, E. Valentinavičius told.

If one counts the value of production per one employee, the total effectiveness of “SBA” Furniture Group enterprises has risen by 73% since 2006. “We compete with manufacturers from the whole world for orders – that being known, we value this rise in effectiveness as one of the most important indicators of our activities”, the vice-president of “SBA” says.

One of the investments of “SBA” Furniture Group in 2014 is the modernisation of “Šilutės baldai” solid wood shop; an investment worth LTL 11m is planned. Following the modernisation, new wood sawing equipment and a fully automated scanner that automatically calculates the sawing location will appear in the shop. Due to achieved precision, less timber will be required for manufacturing and hence, the cost of production will decrease and working efficiency will rise.

“The Lithuanian furniture industry investments into the modernisation of manufacture are consistent and extensive. We possess a developed infrastructure, fair manufacturing potential, adequate specialists and modern technologies. Save for oil production, manufacturing of furniture makes up 10% of all the industry production of Lithuania. We hold the 5th place in “Ikea” list of largest manufacturers – right after China, Poland, Italy and Sweden. This too speaks of the competitiveness of our furniture enterprises. And we compete globally for the orders, this applies all the more so”, the chairman of the “SBA” Furniture Group board notes.

The production of “SBA” Furniture Group is exported both eastwards and westwards. The geographic ending point of our production greatly varies – from USA in the West to China in the East. European sales have also grown in Germany and Austria.

“SBA” Furniture Group unites seven manufacturing enterprises of Lithuania, Russia and Belarus – “Kauno baldai”, ‘Klaipėdos baldai”, “Visagino linija”, “Šilutės baldai”, “Germanika”, “Novomebel” and “Mebelain”. In 2013, consolidated sales of “SBA” Furniture Group have exceeded LTL 689m. “SBA” Furniture Group is a part of “SBA” Concern.

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