Furniture Business: Tips on Starting and Estimated Capital, Complete!

The furniture business is a type of business that focuses on the manufacture and sale of various types of furniture or furniture, such as chairs, tables, cabinets, shelves, and so on.

In the manufacturing process, this one business does not only focus on one type of material, such as wood. But you can also use other materials, including aluminum, iron, glass, and many more.

Even though it is included in a business that requires a sizable investment, in fact, this business is still being looked at by many entrepreneurs because of its legit profits with a fairly wide market share.

How? Are you interested in getting into this one business? Let's peel one by one related to the furniture business in this one description!

1. The Advantages and Disadvantages of the Furniture Business

As is the case with businesses in general, the furniture business has advantages and disadvantages. By knowing both of them, you can develop a series of strategies before starting this one business or even reconsider whether the decisions you make will work perfectly.

1.1 The Advantages

Here are some of the advantages that exist in the furniture business.

•  Huge Income

Prices for furniture are generally sold at quite high prices. No doubt, for every sale of existing furniture you have the opportunity to get quite competitive profits, especially if you sell more than 2 pieces of furniture per day or even if you work with agencies, hotels, and others.

•  High and Increasing Furniture Needs

Every year the need for furniture always increases in various regions. Of course, this can happen because it is caused by various factors, such as the increasing number of people who have new families or new residences, current furniture trends, and so on.

1.2 Lack

Lack of furniture business is a variety of risks that may arise when you start this one business. So, of the many deficiencies or risks that exist, here are the risks that are most commonly found.

•  Relatively Not Little Capital

The initial investment costs for this one business are quite large, especially for those of you who want to start completely from scratch, not as a reseller, dropshipper, jastip, and the like.

You will later use this investment for business purposes, such as buying equipment and machinery, raw materials, employee wages, and other operational needs.

•  Fairly High Competition

As already mentioned in the advantages of the furniture business, this one business has a fairly high market demand. The high demand for existing furniture encourages the emergence of competitors from time to time, as well as the prices offered. The more competitors, of course, the more competitive the prices sold for the same type of furniture. Even so, this is not entirely an obstacle as long as you want to innovate and prioritize quality.

2. General Obstacles and Solutions to the Furniture Business

Talking about the advantages and disadvantages of the furniture business that we previously described above, it feels incomplete if we don't discuss the obstacles and solutions that can be done in starting this business.

So, what are the obstacles and solutions that you can consider as part of your business strategy? Here are some descriptions.

Image Source: Freepik/Odua

2.1 Constraint

Various constraints and furniture risks are things that cannot be avoided, even so, you can minimize them by getting to know more closely what obstacles there are.

• The Capital Required is Not Small

The furniture business requires capital ranging from tens to hundreds of millions. For novice businessmen, this nominal is certainly very large.

• The Need for Knowledge in Choosing the Right and Good Quality Furniture Materials

Materials or raw materials used to make furniture are often a separate obstacle, especially for those of you who are in this business for the first time. In addition to raw materials, determining the existing furniture models and designs also complements the existing constraints in starting this business.

• Determining A Business Location is Quite Difficult

In opening a furniture business, the products you offer are generally large in size and take up a lot of space. It is not surprising that determining the location of a business is the next obstacle that is very common for those who are involved in this business.

• People's Tastes are Always Changing Regarding the Type and Model of Furniture

Society as the main target market plays a very important role in the success of this business. Every year, there are many trends in new types and models of furniture emerge. This makes you have to keep racking your brains so that this business can continue.

• Digital Marketing

Taking advantage of the presence of technology is one of the wise and effective steps in marketing matters. The reason is, there are already many online selling platforms that are able to bring many buyers to your store.

But unfortunately, not many furniture sellers have the courage to market their products online or use e-commerce.

Therefore, it never hurts to start understanding the latest technological developments. One of them is by selling on Tokopedia and how to sell on Shopee.

2.2. Solution

2.2.1. Submission of Loans to Banks or Financing Companies to Meet Capital Needs

To make it easier for you to pursue a furniture business, there's nothing wrong with applying for a business capital loan from a trusted bank or finance company such as BFI Finance.

By applying for business capital, your business operations can run well. You can also take advantage of existing capital to continue to innovate and develop the business that you have.

2.2.2. Add Relationships and Knowledge to Experienced Furniture Manufacturers and Craftsmen

In addition to broadening the reach of consumers, by adding relationships, especially with craftsmen and those engaged in similar industries, you can hone your knowledge even better.

2.2.3. Careful Location Survey on the basis of Customer Needs and Requests

You can easily determine sales locations when you have firmly decided who your target market is. In this way, it will be easier for you to choose a place to sell.

Tips for Choosing a Furniture Business Location:

• Determine the target market
• Choose a location close to the target market
• Make sure the location is easy to reach
• Prioritize crowded locations, there is parking, safe, and clean

2.2.4. Up-to-date on the Latest Furniture Models

Finally, make sure to keep updated regarding the latest market tastes. You can use social media to find out what's trending and what people are looking for. That way, it will be easier for you to make furniture that is much coveted and sells it quickly.

3. How to Start a Furniture Business

How about it, BFI friends? Have you started to be interested in trying this one business so far? If so, the following way to start a furniture business is perfect for you to make as a reference before starting!

Image Source: Freepik/Odua

1. Define Target Market

There are various furniture products on the market with different market segments. By determining the target market you choose, such as households, hotels, schools, and so on, it will be easier for you to make and market the products you make.

2. Prepare Business Capital

Calculate all the existing furniture business needs so that you can then estimate the amount of capital needed. The calculation must include raw materials, equipment, production machinery, space rent, worker wages, up to marketing costs.

3. Choose Quality Raw Material Suppliers

Do research on raw material suppliers to get quality materials at affordable prices, so that not only do your customers feel satisfied, but you also benefit.

4. Determine a Strategic Business Location

The location of the business also influences its smooth running of the business. Choose a strategic business location where the location is close to your target market or consumers.

Next, pay attention to the distribution of competitors in the location you will choose. The reason is, if the location you choose is dominated by competitors, your chances of reaping more profits may be a little more challenging.

5. Prepare the Right Marketing and Pricing Strategy

You need to think carefully about the right marketing and pricing strategy. You can do research to find out what the market price of a product is and the marketing strategy used. Don't be afraid to apply A/B testing to any existing strategy.

4. Furniture Business Capital Estimation

For those of you who are wondering whether the furniture business is profitable, here is an estimate of the capital you need to spend to start this one business.

This business is not cheap because it requires high production costs, expensive equipment, a large number of workers, and requires research costs for the design requirements that the market wants.