Furniture industry eyes $500m export boost in five years with focus on technology and design

Bangladesh's furniture industry has been growing rapidly, yet export performance remains constrained by several challenges. Key obstacles include lagging behind in modern technology and automated production, insufficient design innovation and quality control, and the lack of manufacturing aligned with international standards.

However, optimism is rising as the government plans to introduce a temporary duty-free bond facility for partial exporters against bank guarantees. Furniture exporters believe this facility could open a new chapter for the sector, setting an ambitious goal of tripling exports within the next five years.

To boost export diversification and earnings, the National Board of Revenue (NBR) is set to roll out the bond facility shortly.

Selim H Rahman, Chairman of the Bangladesh Furniture Industry Owners Association (BFIOA) and HATIL, told The Business Standard, "We have been requesting such a facility for years. We hope it will be implemented soon. Many industries, including furniture, sell in the domestic market while also exporting. This initiative will greatly benefit such sectors."

"The furniture industry relies on imported raw materials like hardware, lacquer, and fabrics. In many cases, total duties, taxes, and VAT exceed 100%. When we import raw materials and then export finished goods, our production costs make us less competitive. Bonded warehouse facilities will reduce this cost burden, helping Bangladesh's furniture exports grow and compete globally," he added.

Selim further said, "To make the most of this new facility, exporters must act proactively. The government has done its part — now it's up to us to seize the opportunity. If used effectively, we can triple our export volume in the next five years. Our target is to reach $500 million in exports within this period."

Industry experts note that to strengthen export competitiveness, Bangladesh needs to follow Vietnam's example — implementing industry-friendly policies and investing in advanced technology.

According to BFIOA data, the domestic furniture market is worth around Tk30,000 crore, growing at 10–20% annually. Over the last five years, production has risen by 18–20% per year.

A 2022 Bangladesh Investment Development Authority (BIDA) report found that the global furniture market stands at $650 billion, with exports accounting for $328.64 billion. China leads with exports worth $139.48 billion, while Bangladesh ranks 36th, exporting only $110.36 million annually.

To reduce production costs, modern machinery, automation, skilled technical training, and adherence to international production standards are vital. Additionally, eco-friendly manufacturing, waste recycling, and green certification will enhance Bangladesh's competitiveness. National-level training programmes should focus on improving technical, design, and management skills, bridging traditional craftsmanship with industrial production.

The BIDA report also showed that Vietnam's furniture exports grew from $3.06 billion in 2010 to $19.19 billion in 2021 — progress driven by government duty exemptions and industry-friendly policies. Experts believe Bangladesh can adopt similar strategies.

BIDA also pointed out that Bangladesh's timber is not FSC-certified, forcing exporters to import certified wood for export-oriented furniture production. To address this, the country needs a traceable, sustainably managed forestry system.

Selim H Rahman explained, "The Forest Stewardship Council (FSC) certification is required in some European markets. Foreign buyers prioritise sustainability. No one accepts furniture made from illegally sourced timber. We must prove our products are sustainably produced."

He added, "Currently, around 25 companies export furniture. This number must increase. More exporters mean more international buyers. To achieve this, we must develop backward linkage industries supporting the sector."

Selim also emphasised, "We aim to improve quality through modern technology, automated production, and innovative design."

BIDA's report identifies the furniture industry as the country's second-largest employer after garments, with a domestic market worth Tk 30,000 crore.

Industry insiders stress that sustainable growth requires dedicated industrial and economic zones, export-oriented policies, design and technology development, international standard compliance, and foreign investment attraction.

At a recent furniture fair in Dhaka, Commerce Adviser Sheikh Bashiruddin said the government is taking initiatives to expand the furniture industry and its export market. "This sector holds tremendous potential. We need to increase investment to unlock it," he said.

"The government is adopting modern policy measures. Businesses must now focus on innovation. The Ministry of Commerce is exploring new international markets. Furniture reflects creativity and aesthetics — we must work on those strengths," he added.

The adviser further mentioned that the government is pursuing free trade agreements with several countries, which will create new opportunities for the furniture industry.

Bangladesh's furniture industry currently has over 100 brands, including HATIL, Otobi, Regal Furniture, Partex, Brothers, Akhtar Furnishers, Navana, Nadia, and ISHO.

Largest exporters
HATIL leads the way in exporting Bangladeshi furniture, now available in the USA, Canada, the UAE, Saudi Arabia, India, and Bhutan. Other exporters include Otobi, Regal Furniture, Navana, and Akhtar Furnishers.

Number of factories and enterprises

 Around 70,000 entrepreneurs are involved in the furniture sector, encompassing small workshops, medium factories, and large manufacturers. Over 40,000 small and large enterprises operate nationwide, employing about 2.5 million people — making it one of the country's key employment generators.

Industry outlook

The Bangladesh Furniture Industry Owners Association has outlined strategies to expand exports by improving productivity, adopting sustainable practices, increasing exporters, enhancing design and technical capacity, and leveraging government incentives.

They believe that through innovation, sustainability, and expanded export bases, Bangladesh can attract more global buyers and achieve its $500 million export target within five years.

Industry risks

Despite its potential, the industry faces high production costs, dependency on imported raw materials, inconsistent quality, infrastructure gaps, and policy weaknesses. These issues raise costs for compliant producers and restrict export potential — challenges that must be addressed for Bangladesh's furniture industry to thrive globally.