Let’s start with a summary of the past year. How was 2022 in Melaco and in the industry?

One thing can be said for sure about 2022 – that it was exceptional. Not only for us and for the industry but generally for the entire economy, in Poland and in the world. As for the industry itself, we entered 2022 with another wave of the pandemic when the economy and the furniture industry were struggling with the problem of rising raw material prices. In 2021, there was an avalanche increase in the prices of raw materials such as boards, furniture foils, and adhesives, i.e. those basic materials used in our production. All this was compounded by the war in Ukraine, the energy crisis, galloping inflation and rising interest rates. Everything that could appear in every entrepreneur’s worst nightmare (laughs).

Read also: How the pandemic motivated us to act – an interview with Dariusz Piotrowski, Vice President of Melaco

It’s hard to find positives among all this. How did this situation affect Melaco?

Of course, we had to face all of these challenges because the consequences did not spare us. In the second half of 2022, there was a very strong slump in terms of the volume of orders. The entire furniture industry suffered, because the decline in sales was recorded by furniture manufacturers at the level of 10-15% and we are talking here about absolute values, i.e. after taking into account the rising prices, this percentage decrease is many times greater. It might seem that higher prices are able to compensate for the decrease in sales, but it doesn’t work like that. For example, purchases of a certain group of raw materials increased in value by 25%, which resulted in an increase in the volume of these materials by only 10%.

We had to operate in such conditions and today I can say that we met the challenges. We struggled with enormous difficulties, we had to solve all problems practically on an ongoing basis, but we persevered.

What is the recipe for success then?

For Melaco, the recipe for success, i.e. getting through such difficult times, covered several areas. First of all, great efforts should still be put into acquiring new customers, increasing their number and quality. It is also important to diversify customers, try to reach new companies with different business profiles and create new cooperation opportunities. The third important pillar is flexibility and openness to what customers expect from us. We listened very carefully to what our partners proposed to us, we undertook various activities that increased our chances of increasing sales and developing new areas.

Because you have to remember that in situations like the current one, there is a lot of movement in the market. It’s a bit like sticking a stick into an anthill  – the market wants to defend itself. And customers who are intensively looking for new opportunities to develop their products want to defend themselves similarly. This generates specific actions, including new sales opportunities. At Melaco, we were open to our clients’ suggestions and decided on an ongoing basis how and to what extent we were able to meet them, as well as what was required of us, and what new directions of development we could set for ourselves.

So in every threat, there is also an opportunity, and difficulties can even awaken creativity.

Exactly. We have been preparing for this for a long time. We observe trends very closely because on the one hand, we have a specific socio-economic situation, but on the other hand in an industry such as ours, you also need to remember about people who deal with furniture and interior design, who set and define trends. It was the precise observation of these trends that led, for example, to the development of a production line for three-dimensional furniture fronts, which received the prestigious “Diamond of Furniture 2022” award. Thanks to this, we have entered the canon that is currently in force, i.e. moving away from minimalist, simple surfaces towards those patterned, decorated, and richly embossed.

Read also: Melaco with another Furniture Diamond award!

It was not an accident, but the result of our internal perceptions. We created a collection that we could present to customers and these proposals perfectly matched their expectations. This allowed us to launch several new projects, some are still under preparation, and others will appear, for example, in February at the “Furniture Poland” fair in Poznań.

You could say that Melaco has become immune to the crisis.

Not really, because despite these new opportunities, not all initiated projects were successful. Several of them were suspended even at the prototyping stage because the economic situation or the war forced our partners to resign from further investments. No one is truly immune to a crisis that affects everyone. What makes us manage to overcome emerging difficulties is in fact our great determination, perseverance and 30 years of experience. Here I want to highlight the huge contribution of our entire team of employees. We are going through this crisis very actively, we are constantly “running forward”. We know the market forecasts and we know that they are not very positive. We will certainly face the weakening demand for furniture, and thus – for our products. However, we try to look at everything positively and constantly look for these open sales opportunities.

Finally, let’s talk about these forecasts. What will the furniture industry face in 2023?

It is predicted that this year there will be a decline in furniture sales, also on a macro scale. As an industry, we do not forecast any growth, on the contrary – we face a difficult task, consisting in maintaining production and sales in such conditions at levels ensuring the possibility of further investment and development.

However, as I said before, in order to do this, it is necessary to find possibilities on the market. Look for new customers and new opportunities, and develop existing relationships with recipients. For example, we have situations when clients come back to us because although our relations expired some time ago, today, due to new needs, a new area for cooperation appears. We have to take advantage of these situations.

Our clients are also struggling with sales declines and are also looking for new opportunities in which we can help. Everyone – so to speak – wants to catch this oncoming train, and this creates new opportunities. Thanks to this, we, as Melaco, predict an increase in sales in 2023 compared to the previous one. We have several projects planned, we also strive to strengthen cooperation with existing clients and all this fits into our budget. So we are a good example that even in a crisis if you remain flexible, you can win new customers and think about the development of the company.