2020-05-04

SBA furniture sector sales were modest during the first quarter, however companies are picking up their pace

Sales of SBA group's furniture sector, which is the largest such sector in the Baltic states, reached almost 69 million euros during the first quarter of the year - 8 percent less compared to the same period last year, when sales comprised 74 million euros. Recently, however, production in companies has been picking up pace and it is expected that these companies will once again operate at full capacity as of this summer.

"At the beginning of the year, we tried to predict the potential effect of the pandemic, but the actual extent of its worldwide impact was unprecedented. And the furniture sector is no exception. Our manufacturers were also affected by the consequences of the pandemic, after quarantine restrictions were imposed in Europe, Asia and America, and most of our export markets temporarily closed their stores. Since mid-March, we have been forced to reduce our production capacity," says SBA Vice President Egidijus Valentinavičius.

During the first quarter of the year, the sales of companies managed by SBA Furniture Group were affected differently by the pandemic. Compared to last year, "Šilutės baldai" increased its sales by 7 percent (up to 9 million euros), even under quarantine conditions. The sales of "Klaipėdos baldai" and "Visagino linija" dropped by 11 percent, comprising 19 million euros and 17 million euros respectively. "Germanika", a company operating in Šilutė district, sold its output for nearly 10 million euros - 28 percent less than during the first quarter of last year, which was a particularly successful period for the company. The sales of "Mebelain" operating in Belarus dropped by 6 percent - to 7 million euros.

In the first quarter of the year, soft furniture manufacturer "Kauno baldai" belonging to the SBA group grew by 5 percent and sold its output for 5.3 million euros.

According to E. Valentinavičius, the pandemic will have a significant impact on the furniture sector in the second quarter as well, although order forecasts provide more grounds for optimism.

"Judging by the current demand for furniture and incoming orders, we can see positive developments determined by looser quarantine restrictions and opening stores around the word. Assuming that the coronavirus will not come back with a second wave and quarantine restrictions will continue to be loosened around the world, we plan to once again operate as per usual after a month or two. Most of our companies will resume operation at a steadier pace as early as in May, while production without any downtime will commence as of June," says E.Valentinavičius.

According to him, SBA companies are using the quarantine period to implement innovation and production efficiency measures. In April, a logistics centre managed by "Innovo logistika" opened its doors in the SBA Technology and Innovation Park in Klaipėda district. The centre will help furniture manufacturers organise their supply chain more efficiently, ensuring that output reaches stores around the world faster. Companies of the SBA furniture sector export 95 percent of their output. 

During the quarantine, SBA furniture companies actively contributed to social support initiative projects. In cities and towns where these companies are established, they provided medics with several hundreds of reusable face masks made by "Utenos trikotažas". By using the funds donated by SBA companies and their employees, SBA volunteers purchased 1000 packages of nutritious and healthy food products and distributed them among disadvantaged residents. In some cities, support was also provided to musicians who lost their income due to quarantine. In turn, these musicians held free concerts in the courtyards of apartment buildings.

Return to news archive