Tadiwos Negatu, a branch manager of Chinese furniture manufacturer, NH Bay, is upbeat about the holiday business coming his way. His branch, located at Setit Mall in front of Kotebe Michael church, is one of three that are located nearer to the CMC area, a target market for the company.
The Ethiopian New Year market has been helped by the Diaspora Day, which was celebrated only weeks earlier, he told Fortune.
The New Year is coming with a business boon for the larger ones, such as NH Bay, as well as the smaller ones like those seen along Haile Gebreselassie Street, which sell both new and used items.
Holidays, such as New Year, Easter and Christmas are always good for business, Tadiwos said, and it is getting better for this holiday. The company has been preparing a new stock of household items such as dining tables, beds and sofas, all made at its workshop in Akaki, Kality district.
For instance, NH has already prepared 20 pieces of what it calls “008” sofas made of both leather and fabric, and sold for 135,000 Br, after a 30pc discount, applicable on all household items. It also had 28 pieces of “001” sofas which are tagged with 73,000 Br price. Both the sofas are available into two colours.
“Now we are almost finished with this stock of sofas, because people are buying them fast,” Tadiwos said, with obvious satisfaction.
In the past two weeks, the branch has sold 20 sofas. Two were sold while Fortune was visiting the store.
NH Bay seems to be successfully targeting the higher income groups residing in the CMC area.
A new homemaker, Selam Zewidu, was visiting the shop with a small child on September 2, 2015. She looked around and told Fortune that it was good to see that the company had both quality and fair prices.
She bought a red leather sofa for 109,676 Br.
NH had also sofas that sold for 54,500 Br after the discount.
Lula Tebeje, a mother of three, was at NH Bay when she spotted a dressing table that she wanted, although she was there to buy other items. The discount was what allured her to NH Bay Setit branch, where she bought the dressing table for 24,000 Br.
“I had planned to purchase other items,” she confessed.
The sector is now more competitive with the coming of new players, Tadiwose said. That was preventing them from going for higher profits, he added.
According to 2014 data from the Ethiopian Chamber of Commerce & Sectoral Associations (ECCSA), there are 78 large and medium-sized furniture manufacturers in Addis Abeba and 290 throughout the country.
“Having the demand of this season in mind, we are now producing two medium-priced sofas and one high-priced sofa per day,” Tadiwose told and Fortune.
The company imports inputs, such as high definition timber, from China, while it sources hardwood locally from Shashemene, 250Km south of Addis Abeba. The high definition timber is used for the upper part of tables, for example, while the legs are made from hard wood. Leather and fabric are also imported from China.
NH Bay is also enjoying big sales of beds and other household items.
Beds of leather and wood in sizes of 1.2m, 1.5m and 1.8m, are available for 13,900 Br to 22,000 Br, depending on materials and lengths. Along with the beds the company also has imported mattresses from China, with price tags from 15,000 Br to 22,000 Br.
Getting hard currency for importing inputs is difficult, Tadiwose said.There is another company in town, Deluxe, which imports finished furniture for sale in the local market. The company was established in 2003 with 135 employees, as a division of Minaye Plc. It has seven outlets, including one in Hawassa, according to its website.
Deluxe has a six-floor showroom at Olympia. It is welcoming the New Year market with discounts ranging from five per cent to 30pc.
The company has extensive stock, with large supplies of many kinds of items, from safe boxes to various types of office and household furniture. Its dining tables finished with high definition wood go for 10,900 Br to 31,950 Br; whereas tables made entirely of hardwood, go for 22,000 Br to 51,000 Br, all imported from Malaysia and China. Its leather and fabric sofas sell for 48,000 Br and 90,000 Br, respectively.
Despite the New Year’s arriving, however, the market is still not at its peak, said Firehiwot Tadesse, sales officer at Deluxe’s Olympia branch.
As Fortune observed while present at that branch on September 2, 2015 three people visited the showroom, none making any purchase.
“I am hoping for more to come in this week,” she added.
At the much lower end of the market is a furniture shop ran by Tesfaye Hadush and his brother, one of several along Haile Gebreselassie Street. They mostly refurbish old furniture for resale.
They sell L-shaped sofas, glass-top tables, closets and television stands. When Fortune visited the store, Tesfaye was receiving a 500 Br advance payment from a woman who wanted delivery of a buffet before the holiday. Tesfaye and his brother make their own buffets from scratch and sell them for 1,300 Br to 1,500 Br. The buy old sofas for 2,500 Br to 3,000 Br and refurbish and sell them for 4,000 Br.
Following the construction of the road and the railway line, which caused a split from the other side of the street the market of these small furniture-makers, has decreased significantly, said Tesfaye.
“My elder brother is almost giving up on the job,” he lamented.
But as Fortune witness, there was a little comfort for Tesfaye as he was able to sell two items for which he received full payment of 6,000 Br.
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