Scan-D Corp (詩肯), which designs and sells teak furniture under the Scanteak brand, yesterday said it would continue to expand its Taiwanese operations, despite weakening market sentiment.
“We feel that the current downturn represents an opportunity to continue expanding into more segments,” Scan-D chairman Lim Pok Chin (林福勤) said after announcing a partnership with Germany-based Nolte Group, the largest furniture maker in Europe.
Scan-D, which operates 82 Scanteak stores and 12 Scan Living outlets in Taiwan, plans to add eight more Scan Living outlets this year and further expand the figure to 100 in a decade, Lim said.
Photo: Yang Ya-min, Taipei Times
He said that the company has weathered similar downturns since its founding in Singapore in 1974 and that the company is not especially affected by this one.
“We estimate a 1 percent quarterly decline in the April-to-June period, compared with the 50 percent to 70 percent drop reported by our peers operating in Taipei’s Wugu District (五股),” Lim said.
In the first six months of the year, the company’s cumulative sales were down 0.75 percent to NT$793.86 million (US$25 million) from the same period last year, company data showed.
Net income in the first quarter was NT$56.4 million, compared with NT$63.2 million the previous year.
The company has not released its second-quarter profit figure and declined to provide a sales guidance for the second half, saying that visibility remains low in the furniture business.
However, Taiwan remains a major market for the company and a logistics center built two years ago is scheduled to commence operations this year, replacing rented warehouses in Wugu District, said Tommy Ho (何山壯), a senior manager in the finance department.
“Taiwanese consumers do not like to wait on purchases, so we must ensure ample stock and swift delivery times,” Ho said.
Scan-D’s products are characterized by Scandinavian-style design and are priced in the mid to high-end range. In order to strengthen the company’s foothold in the mid-range market, the company has acquired exclusive distribution rights in Taiwan for Nolte Group’s CS Schmal brand.
“CS Schmal’s Cleo series of wood and glass paneled furniture represents the ideal addition to our product mix,” Lim said.
Nolte Group director of export sales Frank Renders said the Cleo series is ideal for smaller Taiwanese homes.
“We plan to bring CS Schmal’s Rio Art furniture series to capture the market for home storage and organization products in Taiwan,” Renders said.
Looking ahead, Scan-D plans to introduce a new brand next month, followed by two more German brands in October.
“In light of the dwindling prospects in the top tier, we are adopting a similar approach to apparel giants Uniqlo and Zara, and are striving to bring high-quality products with European design aesthetics at accessible prices to the Taiwanese market,” Lim said.
Scan-D shares rose 2.18 percent to close at NT$51.6 in Taipei trading yesterday. The shares have declined 35.9 percent since the beginning of the year.
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