International buyers fill Cologne show
Total traffic declines slightly, but 26% more non-Europeans attend
By Powell Slaughter -- Furniture Today, February 3, 2002
COLOGNE, Germany — A big influx of international buyers helped offset a decline in German attendance at last month's Cologne International Furniture Fair.
European Union attendance from outside Germany was up 4% and non-European participation rose 26%, especially from China, India, Israel, Japan, North America, South Korea and Taiwan. The fair drew 120,000 visitors, down only slightly from 2001's 121,995.
All that was good news for German manufacturers, who expect a 4.5% drop in domestic shipments to $26.1 billion during 2001.
"We feel the internationality of the fair is one of the tools that allow German exhibitors to make business during a difficult time in the German economy," said Wolfgang Kranz, director of KölnMesse, which hosts the Cologne fair. "We'll be working to continue broadening the fair's international flavor."
Foreign exhibitors totaled 67% of the 1,459 suppliers at the show.
The advent of the Euro as Europe's most widespread currency could boost future participation in the Cologne Fair, as well. Both European and North American exhibitors said the new currency can simplify business for both buyers and sellers in Europe.
Eighty percent of German upholstery manufacturer W. Schillig's business is in countries switching to the Euro, said Erik Stammberger, president of Schillig USA.
"Basically, we now have one price list for 80% of our sales, while before at shows you would carry so many price lists," he said.
Natuzzi has had little feedback on the Euro so far, but is optimistic about its impact, said Vittoria Ricciardi, public relations specialist.
"From a pricing and a commercial exchange point of view, it's going to make things much simpler, and for accounting as well," she said. "The practical side of the business is going to be much easier."
American companies here also liked the Euro.
"It's going to be much easier to do business since you don't have to deal with all the other currencies," said Shari Wanek-Wagner, vice president of international marketing for Ashley. "Even when you're just going somewhere, it makes the traveling easier."
The Sept. 11 terrorist attacks shook the confidence of consumers in Europe. But exhibitors here say that as in North America, Europeans are now placing a higher priority on home and family.
"We were all quite worried about the repercussions, but then paradoxically, we keep on growing our business," said Natuzzi's Ricciardi. "People in a sense are reconsidering their life and getting more intimate and home-oriented in Europe."
The attacks did force European companies exporting to the United States to build more lead time into their shipments because of tighter customs inspections.
"Shipping to the United States just takes longer, and it's more complicated time-wise," said Stammberger at Schillig. "There's been no major impact beyond that, though."
Some credited the big jump in attendance from non-European buyers in Cologne to lackluster attendance at last October's High Point market, just five weeks after the Sept. 11 attacks. After skipping a meal in October, many buyers here had healthy appetites.
Tim Branscome, a London-based international furniture consultant and former trade representative for the North Carolina Department of Commerce, said written business was among the best in the 10 years he has visited the Cologne Fair.
"Based on my observations and conversations with several exhibitors from the USA, Asia and Europe, I believe this has been one of the best shows for sales ever," he said. "Visitor traffic exceeded everyone's expectations."
While they liked what they saw at the Cologne Fair, Western European manufacturers — like their North American counterparts — face considerable challenges in the coming year. China offers stiff competition, as do low-cost producers from former Soviet-bloc countries in Eastern Europe.
"We had one of our best years last year, but many companies had problems," Stammberger said. "In 2002, we think the pressure of the pricing and competition, especially from Eastern Europe, will set new standards for promotional goods, since a lot of companies in Western Europe can't keep up with the labor costs there."
He said that consumer pressure for lower pricing is affecting the high end, even brand names, while low-end manufacturers are getting squeezed from the East.
"Everyone is trying to move to the middle — the high guys want to offer a B line, and the promotional guys are trading up," Stammberger said. "There will be a major clearing up process at both retail and manufacturing. A lot of the people here now won't be here next year."
Even if that happens, the fair itself expects to grow as it attracts more international participation from companies like U.S.-based leather upholstery manufacturer DeCoro, a first-time exhibitor this year.
"Our primary markets are the United States, United Kingdom and Canada," said Jeff Baron, president. But he said DeCoro also has shown in Paris for three years, and looks to Cologne to broaden its European business.
"One of the most important European leather merchants was here two minutes after nine on opening day, and he bought," Baron said. "We think it's important to show Europe who we are, particularly since they seem curious. We want to meet people, make some friends, do some business."
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