EXECUTIVE SUMMARY
The city of Moratuwa is recognized from the history dating back to decades for wood based furniture manufacturing where many number of entrepreneurs have emerged through this industry. The wood work sector in Moratuwa functions in several forms varying from wood processing to furniture manufacturing. Timber products manufactured in Moratuwa are exported to several countries in the world and the history reveals that the Buckingham Palace was among these buyers of Sri Lankan furniture. Currently the timber industry is facing an unfortunate situation since it is gradually becoming dysfunctional due to technological, management and environmental and social aspects. This comprehensive report focuses on the issues prevailing in this sector that causes detrimental effects on the functioning of the world renowned carpentry sector. The government along with the responsible authorities should take necessary corrective measures in order to revive the wood work industry from its plight and improve the quality standards in order to meet the changing customer expectations.
INTRODUCTION
Moratuwa which is the heart of the Sri Lankan wood work industry has created a large number of small and medium scale entrepreneurs through years. This industry has a history which spans to decades and Sri Lankan carpentry is world famous reaching nations across the ocean. It is said that the Buckingham Palace in London has their traditional furniture designed and produced in the city of Moratuwa. The Furniture Manufacturing Industry (FMI) operates mostly in Moratumulla, Molpe, Willorawatte and Kothalan – daluwa areas where around ten thousand timber workshops have been established. The wood work sector can be categorized in to major divisions including saw mills where timber is being processed, furniture manufacturing, construction and parquet flooring and wood based panel products. Small scale carpentry workshops use traditional tools and equipment in their saw mills with less than ten employees working where as a considerable amount of the establishments in the area operate in medium scale with mechanized carpentry sheds associated with a saw mill and a furniture shop as well. More than 40 furniture items are being manufactured using mostly Teak, Nadun and Satin timber; air dried or kiln dried and the designs are based on consumer preferences, traditional designs which are passed down from generation to generation or designs from foreign catalogues. Semi – finished furniture is being transported outstation where they are finished and sold to the consumers whereas finished products are sold in the shop outlets in the Moratuwa area itself. The workforce of the timber industry basically comprises of skilled and semi – skilled carpenters of the age ranging from 40 -55 years, with poor literacy levels who possess knowledge passed on to them by their fore fathers.
CURRENT STATUS OF THE FURNITURE MANUFACTURING INDUSTRY IN MORATUWA
The world renowned furniture manufacturing industry in Moratuwa is currently facing difficult times and most of the small and medium scale establishments are affected and becoming dysfunctional during the past few years. Around 60% of the wood workshops are gradually closing down owing to technological, management issues prevailing in the industry as whole and environmental and social issues that affect externally to the industry. This directly affects the workforce of the Moratuwa area since these small and medium scale entrepreneurial opportunities are what provides them with employment who would else remain unemployed due to low education levels. Declining demand for wood based furniture has affected the production of them and the turnover of these SMEs is collapsing hence encouraging lay – offs. Moreover auxiliary services that support the carpentry industry such as transportation of furniture and other finished products too are affected by this causing many another left unemployed and deprived of their daily income which else they would have earned. With such a situation, the rate of unemployment has reached alarming levels in the Moratuwa district creating social impacts, falling apart of families, health issues such as depression and an increase of the crime rates in the region.
The main reasons which have led to a decline in demand for wood based furniture could be identified as follows.
- The increase of prices of the wooden furniture – This is mainly due to the high price of timber which has to be purchased through the Timber Corporation since issuing of permits for obtaining wood is restricted by government legislations
- Cancellation of licence for the transportation of finished furniture products
- Imported furniture and furniture produced using treated wood such as MDF are gaining popularity since they blend perfectly with the life style of the modern world
- Low price substitutions for wood such as Plastic is rapidly approaching the market and is gaining huge popularity due to its convenience and low cost maintenance, over wooden furniture
ISSUES AND PROBLEMS WHICH WOOD WORK SMEs OF THIS AREA FACES
Many surveys and researches have been conducted in order to identify the causes behind the downfall of the furniture manufacturing industry of Moratuwa. They have revealed that it is mainly owing to the fact that the wood based furniture industry cannot produce wood work products to suit the modern age with changing consumer tastes at an affordable price. Hence low price, customer specific, durable substitutes gain market share which was once held by the legendary furniture manufactured in the city of Moratuwa. Issues underlying this situation can be further categorized as;
- Technological issues
- Human resource issues
- Management issues
- Lack of interest of the government and other responsible authorities
This report here onwards elaborates the above mentioned problems the carpentry industry faces currently and should be addressed in order to revive from its plight and improved to gain back its lost glory while providing the customers with world class quality products designed to suit the requirements of the modern era at an affordable price.
Technological issues
Most of the establishments of the furniture manufacturing industry comprise of small scale carpentry workshops which are mostly labour intensive using not quite advanced technology and mostly traditional tools. Less than ten employees work in these workshops. Traditional seasoning methods such as air drying is used in these and design patterns which are passed down from father – to – son are used in manufacturing furniture. Thus the productivity of these is quite low and they are unable to get the benefits of economies of scale. In order to cater the customer needs with latest designs incurring low cost per unit, they need to adapt new technology and machinery but in order to upgrade the process it requires a considerably large budget which they are unable to afford.
While the situation with small scale industries is as described above, medium scale industries which are mostly mechanized and adapt latest technology for processing of wood, lack skilled labour who possess the technical knowledge and expertise and a training in operating them.
Moreover the designs that are used for the furniture produced are mostly quite traditional and it is essential to introduce advanced, innovative designs in order to face the competition raised by other wood work manufacturers and substitute products which are more customized to cater the needs of the changing, modern life style.
New trends related to wood work industry which are adopted by world manufacturers in order to produce a quality, durable, attractive end product that fits well into the modern age in satisfying the customer needs are termed as ‘Wood Technology’. Further the advancements of this industry require knowledge regarding technical mathematics in order to produce a better outcome as per the demand of the consumer; where the main focus is on the measurements associated with woodcraft and developing a prototype of new designs for detailed analysis hence make further improvements. Moreover skills and knowledge related to technical drawings are becoming essential in producing innovative designs that could compete with imported furniture. Wood processing is another critical aspect of the carpentry industry since the quality and durability of the finished product solely depend on these factors. Chemical wood processing plants are the latest advancement in which the timber will be chemically treated in order to reduce the moisture content to levels which are accepted in international standards for quality wood that will ultimately produce highly durable, long lasting furniture which is on high demand in market. Apart from these, the labour force of the wood work industry should possess practical skills including basic woodwork processing, metalwork, furniture making, joinery, and carpentry to be adapted with the cutting edge technology available so as to achieve the benefits of economies of scale thus gaining competitive advantage under the prevailing market conditions.
Moratuwa city which is a knowledge hub with many technological institutes being situated in the close proximity, numerous opportunities are available for the improvement of the wood based furniture manufacturing industry. The University of Moratuwa which produces best engineers, architects and technical personals of the country with a sound theoretical background along with practical exposure and technical expertise; could collaborate with other technical institutes of the area to provide solutions to the technological issues the furniture industry is currently facing. Along with the affiliation of the foreign universities especially German universities and technical institutes that are well known for innovative designs with modern technical know – how; who offer knowledge and skills on woodcraft, the University can offer international level diploma and certificate courses to the youth of the area who are interested in joining the industry and to provide technical assistance in upgrading the standards of the furniture manufacturing industry. This will be a new venture with a lot of new employment opportunities emerging and as well as the woodcraft industry could be revived infusing modern technical expertise. Furthermore woodwork training could be offered to school levers of the families of who are involved in the carpentry industry to enter to the profession and to the current employees of the small and medium scale workshops in order to improve their skills and knowledge.
Human resource issues
As mentioned previously, the labour force of the SMEs related to wood work comprises of skilled, semi – skilled and unskilled labour with low literacy levels and the dominant age group is between 40 – 55 years of age. One of the major problems the industry currently faces which had led to its downfall is the shortage of skilled labour. Surveys reveal that only 50% of the children of the workers join back and continue the tradition but they are also lacking the required skills and competencies in order to produce a better outcome to the customer. The low education standards of these employees, adapting new technology and machinery in order to upgrade the industry level become a challenging task. Further the declining demand for carpentry products encourage the youth of the area to deviate to other employment opportunities creating a deficit of labour in this industry.
Appropriate vocational training on wood working machinery and advance technologies that are adapted in the industry should be given to the current employees as well as those who are willing to join the industry specially school leavers and lay – offs, to enhance their skills in furniture making, joinery, and carpentry. The technical institutes of the Moratuwa area could offer certificate programmes as an encouragement where youth can be attracted to new education opportunities which are derived from our local industries hence they could contribute back for the betterment of the industry.
Management issues
The small and medium scale carpentry workshops are almost all the time managed by the proprietor who is a carpenter himself. Only a limited number of medium scale establishments employ a manager for administration purposes yet no proper management hierarchy could be found within these as well. Hence due to the lack of management skills, certain issues are observed in preliminary management practices that includes inventory handling, working capital management and human resource management. It was observed that most of these entrepreneurs have low education levels with some even having not completed their secondary education. Thus implanting management skills in them is a challenge which can be achieved through educating the SME owners of the area regarding business planning and strategies, branding and marketing and working capital management. The initiative to build up awareness in these sectors should begin from secondary education provided at the school level itself which will attract more and more fresh entrepreneurs to the industry with developed management skills.
Lack of interest of the government and other responsible authorities
Although it is urged that the furniture manufacturing industries should upgrade their standards by introducing modern technology and machinery, the capital investment required is quite large hence entrepreneurs hesitate in adapting these new techniques. Even if they are willing to take that risk, raising funds become difficult yet impossible since the lack of government interference in assisting with the finances of these SMEs leaves them with the only alternative of acquiring grants from a third party at a high interest rate. Obtaining loans from banks is a tedious task associated with heavy paper work which they are unable to proceed with. Thus the government should directly involve in providing with a convenient procedure to obtain loans at a subsidised interest rate as an encouragement.
Further government along with relevant authorities should prepare and implement plans for providing vocational training for the employees of these SMEs in order to enhance their skills in woodcraft and management so that the Sri Lankan wood based furniture industry could be improved to reach world standard levels.
CONCLUSION It is evident from the above facts that wood based furniture manufacturing industry operating in the Moratuwa area is facing many problems hence not performing in the expected manner. The problems vary from technological issues which directly affects the productivity hence the sales and its revenue to issues with the workforce engaged in the industry and the management of the operations of their workplaces. Further the lack of interest of the responsible authorities have made them the situation more worse since they are desperately in need of a helping hand for the revival of this industry.
Moratuwa being a hub of technological knowledge and expertise could assist this dying industry to recover to its original status once it held. The technical institutes in the area could collaborate with the government to provide technical assistance to improve productivity and efficiency of the manufacturing process thus earn more revenue and increase the quality of life of the occupants of this industry. It is high time that the authorities take necessary steps for the revival of the legendary furniture manufacturing industry of Moratuwa and produce a better output hence capture the global market in future.
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