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Name of Group : 1. INDAH LESTARI (174046)

About Furniture
Furniture is a terminology used for household furniture that serves to store goods, as a place to sit, bed, a place
to write something in the form of a table or place to put something on it. For example, furniture that serves to
store is generally equipped with doors, drawers and shelves, such as bookcases, wardrobes, etc.

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Why does Indonesia choose furniture
 Goverments pays special attention to the development of the furniture industry in the country. In
fact, the furniture industry is one of the government's mainstays to increase exports.

 This sector also provides a lot of employment, provides foreign exchange, and also creates good
creativity, "said Vice President Jusuf Kalla (JK) when opening the 2016 Indonesia International
Furniture Expo (IFEX) at the Jakarta International Expo, Kemayoran, Jakarta, Friday (11 / 3).

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 Indonesia is known as one of the main exporters of furniture in the world because it has abundant raw
materials. Furniture products are included in Indonesia's four main export commodities outside of oil and
gas along with palm oil, textiles and rubber (Purnomo,et. Al.,2011).

 The furniture industry is an industry that processes raw materials or semi-finished materials from wood,
rattan, and other natural raw materials into finished products.

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The area of furniture production is in almost all provinces, with a high concentration of producers located in
the regions of Jepara, Klaten, Pasuruan, Sidoarjo, Gresik, Cirebon, Sukoharjo, Surakarta, and Jabodetabek
(AMKRI, 2015).

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The furniture industry is spread in almost all provinces, with large centers located in Jepara, Cirebon,
Sukoharjo, Surakarta, Klaten, Pasuruan, Gresik, Sidoarjo, Jabodetabek and others (Daniel Dimas, 2013).

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Furniture Export from Indonesia
 Indonesia is one of the top 20 largest furniture exporters in the entire world, one of the most famous of
which is Jepara Furniture with an established reputation, especially in the fields of outdoor furniture
from teak, bamboo and rattan and carved furniture.
 The city of Jepara is very famous as the largest furniture producing city in Indonesia. The city is located
in Central Java, north of Semarang, which is famous for its wood carvings. People call it the city of

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 Global Furniture Market Conditions The order of the world's major exporters in 2015,
according to Trademap (2016) is:

1. People's Republic of China (PRC) (amounting to 24%, USD 29 billion),

2. Singapore (15%, USD 18 billion),
3. Japan (11%, USD 13 billion),
4. Malaysia (7%, USD 8.5 billion),
5. South Korea (7%, USD 8.4 billion).
6. The next sequence is Thailand and the United States of around 6% with a value of USD
8.1 billion, and USD 7 billion respectively.
7. Meanwhile, Indonesia is only able to export USD 87.55 Million.

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The Development of Furniture Exports
in Indonesia
 The Ministry of Industry's Director General of Small and Medium Industries (IKM) Gati
Wibawaningsih said, from January to October 2018, the shipping value of national wooden
furniture and handicraft products reached US $ 1.4 billion. This is up 4.83 percent from the
same period in 2017.

 According to Gati, the furniture industry has a strategic role in spurring Indonesia's economic
growth, one of which is through export performance.

Competitors of Indonesian Furniture
BPS data in 2016 showed that the value of Indonesian furniture exports in 2015 reached USD
1.81 billion and ranked 21st in Indonesia's export products, lower than the previous year with
exports of USD 1.9 billion.

 The ten major world exporters (Figure 5.8),

1. China is in the first position in 2015 with an export value
of 55% or valued at USD 98.73 billion,
2. followed by Germany with a market share of 9% or USD
16.29 billion,
3. Italy and the United States of 7% or USD 12.81 billion
and USD 11.55 billion, respectively
4. Poland and Mexico with market pairs of 6% each with a
value of USD 10.91 billion and USD 9.90 billion,
5. Vietnam and Canada 3% each with a value of USD 5.48
billion and USD 5.27 billion,
6. as well as the Czech Republic and the Netherlands of
2% each with a value of USD 4.26 billion and USD 4.30
billion (Trademap, 2016)

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Export Destination of Indonesian
 Based on Indonesia's export data, the destination countries for Indonesian furniture exports in
the first position are:

1. The United States with an export value of 37% or USD 675.76 million from the total exports to
the world of USD 1.6 billion.
2. The second destination country is Japan with 10% USD 189,966 million,
3. followed by the UK at 5%,
4. The Netherlands, Germany, France and Australia are 4% each,
5. while Belgium and South Korea are 3%
6. and RRC 2%
7. and 24% is the value of Indonesia's exports to 197 other countries.

 Some countries are fairly new markets for Indonesian furniture exports, including Russia,
India, and all of Latin America, except Argentina which is still very small.

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Indonesian State Trade Relations
 The Indonesian Furniture and Handicraft Industry Association (HIMKI) Soloraya stated that the
trade war between the United States and China had a positive impact on the growth of the
domestic furniture industry sector.

 "There is an increase in export value of up to 20% in 2018 compared to 2017," said Himki
Soloraya Adi Dharma S as quoted by the Neraca Daily, Jakarta, Friday (1/11/2019).

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 One of the cooperation in the economic field is furniture exports and imports between ASEAN
member countries. Indonesia is one of the ASEAN member countries that carries out export trade
in furniture products.

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Source & Process of Making Wood as
Furniture Material
 Before reaching consumers, there are several
steps that producers must go through in making
furniture made from wood. Wood for furniture
production is obtained from forests or

The manufacturing process is carried out through several stages, namely cutting logs into a form of
casso, boards and beams which are carried out at the wood seller's place. Then the material is cut
according to the size of the product, the formation of a product model with a lathe, the engraving of
finished products, the use of sandpaper, coloring and finishing.

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Furniture Raw Materials
 Indonesian furniture products are known to have quite high competitiveness in the international
market. The competitiveness is in the form of unique designs and furniture products with typical
raw materials such as rattan, bamboo and teak compared to furniture produced by other

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 For the export market itself, countries like Europe and America prefer classical-style furniture. That is
why, demand for mahogany wood furniture is higher, especially for the two export destination
countries. If teak is better known for its durability and toughness, mahogany has a sale value in terms
of aesthetics and luxurious impression.


Packaging and Shipping Process
The stages of the production process are:

a. Selection of raw materials

Previously the selection of raw materials was held with the aim
that the results would be good and the raw materials were
materials with export standards.

b. Wood Concession
After selecting raw materials, the wood oven is then carried out
to obtain dry wood and wood products are not easily damaged
c. Quality control of semi-finished goods
In this process, the goods are checked for quality if below the
standard set, the goods will not be used, this is done to ensure
that the products produced are goods that have good quality.
Things that need to be considered in conducting quality control
include wood construction and the model or dimensions of

d. Termite spraying
At this stage, semi-finished goods will be sprayed with termites
to avoid products from termite animals that can damage the
e. Finishing
At this stage, the product has been formed and will be categorized in
two parts, namely antiques and plain goods, where in this stage both
parts are carried out sanding, coloring, refining and deleting the first

f. Quality control finishing

At this stage the product will be reviewed for its feasibility and the
quality of the product itself in order to obtain quality products that
are truly guaranteed quality. The things that are considered in this
process include the smoothness and color of the product.

g. Packing
This process is a product packing process or product packaging to be
sent to the buyer

 Payment method
As a furniture company that has long carried out transactions export and already has a fixed buyer, CV.
ACLASS inside make payment transactions with the buyer that is using Letter of Credit even though there are
buyers who make payments by using T / T (Telegraphic Transfer) and that is usually done by the buyer just
doing the first transaction with CV. ACLASS.
The Furniture Export Procedure Is Conducted By CV. ACLASS

1. Correspondence with Foreign Importers

2. Making a Trade Contract
3. Making a Letter of Credit (L / C)
4. Preparing Export Items
5. Registering Goods Export Notification (PEB)
6. Ship Space Booking
7. Delivery of Goods to the Port
8. Customs Inspection
9. Loading of Goods to the Ship
10. Certificate of Origin (SKA)
11. Liquefaction of L / C
12. Delivery of Goods to Importers