Sunny Designs expanding
By Thomas Russell -- Furniture Today, February 15, 2010
TIANJIN, China —
Case goods manufacturer Sunny Designs is undertaking a major expansion here that is expected to more than triple the company's production capacity.
The company has a lease arrangement with an option to buy 50 acres about 30 minutes east of its four existing factories this northeast China city. Over the next few years it plans to build a million square feet of manufacturing and warehouse space in 10 buildings on that land.
This ultimately would give the company another 700-containers-per-month capacity. It has a 300-container capacity in its existing 700,000 square feet of manufacturing and warehouse facilities, so the expansion would push its output to 1,000 containers.
Three of the four current factories produce dining, home office, home entertainment and occasional and accent furniture. The fourth, which began operations in August, produces chairs, dining tables and case goods.
A fifth Tianjin-area factory, expected to be completed in May, has two buildings that total about 70,000 square feet and will produce parts.
With the new project, the first phase is expected to be completed in late 2010 and will total about 400,000 square feet, with a capacity of about 300 containers per month. The other two phases, to come on line in 2011 and 2012, will each total about 300,000 square feet.
The facilities will produce a mix of case goods and upholstery.
“What this factory will do is produce a complete line,” said Hokeun Lee, company marketing director. “We can target any category in dozens of different looks once this is up and running.”
Since the company hasn't been able to receive a low U.S. antidumping duty on bedroom furniture, it doesn't produce that category in China. Instead, it produces a limited number of bedroom sets in Indonesia.
The company described the expansion as a multimillion-dollar investment.
Lee said the increased production capacity will enhance the company's ability to develop product in conjunction with retailers.
Company officials said that despite the slow economy, Sunny Designs' revenues were up 20% in 2009 following a 19% increase in 2008. They did not disclose dollar figures.
Officials attribute the growth to the company's wide selection at mostly lower-medium price points. They said that with the expansion, Sunny will broaden its representation at more promotional prices.
“When the economy bounces back, we might have a lot more demand,” Hwang said. “We are capturing more real estate on the (retail) floor.”
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Sunny Designs to triple production capacity
Feb 9, 2010
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