The Polish wood industry, and especially furniture industry, is facing increasingly serious financial problems. 1 example of these difficulties is the situation of Fameg of Radomska, a company with a 140-year tradition which recorded losses in 2023 and decided to carry out restructuring. The company, known for its bent furniture production, announced plans for group layoffs, which is simply a consequence of the decline in profitability.
Restructuring in Fameg
Fameg, a company with a rich history, entered the process of seeking approval of the arrangement with creditors in late May 2023. As part of the restructuring, group exemptions were planned to cover 80 people from the current 587 employees. This decision aims at improving the financial situation of an undertaking that has been suffering losses for 2 years. In 2023 Fameg recorded PLN 2.3 million net loss, and in the erstwhile year PLN 1.5 million. Despite this, the company generated a turnover of PLN 99.6 million, of which 55 percent of the revenues came from export.
Tradition and innovation
Fameg is simply a company that is based on the technology launched by Michael Thonet, the inventor of the wood bending method. Since 1881, Radomsko has been in continuous bending furniture production, and Fameg is presently 1 of the largest manufacturers of wooden bent chairs in Europe. Despite financial difficulties, the company tries to keep its position on the market, continuing its business and not breaking contracts with suppliers. As part of the restructuring , the company besides plans to attract fresh customers .
Troubles in the wood industry
Fameg is not the only 1 struggling. The full wood manufacture in Poland has been facing difficulties for a long time, which escalate due to the advanced prices of wood. manufacture representatives in March 2023 sent a letter to the Prime Minister, in which they called for immediate action to support the wood sector. This letter shows that advanced timber prices in Poland, compared to another European countries, importantly lower the competitiveness of Polish companies. "State Forests, despite clear requests from manufacture resulting from the deep economical crisis, did not lower the starting prices for 2024. They are now much higher, up to 40% compared to wood prices in Germany, the Czech Republic, Slovakia or Latvia", the appeal states.
Industry call for support
The wood manufacture indicates that advanced prices of natural materials, combined with restrictions on access to wood, put companies on the brink of bankruptcy. The letter to the Prime Minister stressed that "the furniture manufacture has been forced to reduce 18,000 jobs in the last fewer months, and further redundancies of 5,000 jobs are expected this year". The sawmill manufacture besides faces difficulties, and many companies endure multimillion losses.
Balance between nature protection and the economy
In its appeal to the government, the timber manufacture highlights the request to keep a balance between environmental protection and economical development. Representatives of the sector indicate that the increase in the area of protected areas in Poland is important, but these actions should be developed jointly with stakeholders so as not to lead to further restrictions on access to natural material. The manufacture besides calls for increased wood harvesting in another forest areas .
Summary
Fameg's problems are reflected in wider difficulties that affect the Polish wood and furniture industry. advanced prices of natural materials and difficulties related to access to wood lead to a decrease in the competitiveness of Polish companies on the global market. The manufacture calls for government support, but will this be adequate to save businesses from bankruptcy? The future of the Polish timber manufacture remains uncertain and decisions taken in the close future may be crucial for further improvement of this sector.
Daniel Głogowski
Expert in his field – Publicist, author and social activist. The first articles were published in 1999 for global publishers. For more than 30 years, he has gained his experience through cooperation with the largest editorial offices. In his articles, he seeks to address controversial topics and present first viewpoints that allowed for a deeper knowing of the issues discussed.
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Crisis of the furniture manufacture in Poland. Fameg from Radomska ordered group dismissals
