Polish furniture exports to the European Union have grown markedly. Exports to Russia have also increased, overcoming a previous stagnation, according to data by the Ministry of the Economy and Labor.

Wood industry exports in 2004 totaled $6.8 billion and were almost $1.5 billion higher than in 2003 ($5.4 billion). Furniture and wood product exports account for 9.2 percent of Poland's total commodity exports. Stagnation has been overcome in Polish furniture exports to Russia. They grew by about 67 percent to reach $78.4 million, up from $47 million in 2003. The main cause behind the decline of Polish furniture deliveries to this country in 2002/03 was high import duties imposed by the Russian government on Polish furniture. Despite duty rates unfavorable to exporters, Polish producers modernized their production technology and expanded their range of furniture, which led to greater interest among Russian customers.

However, EU countries are still the main export markets for Polish furniture. About 82 percent of Polish wood products are sold on EU markets, including 41 percent in Germany. Preliminary data for 2005 also shows that the sector is doing well.

Analysts say that the improved performance of this sector is the result of a strong recovery in the Polish economy and increased demand for furniture and wood products on EU markets. Another important factor is EU membership. However, from a broader perspective, the positive results achieved by Polish furniture exporters recorded over the past several years are due to a few factors, including continually low domestic demand, Western capital involvement and the dynamic development of Polish factories established in the early 1990s.

The furniture industry is among sectors with many years of tradition in Poland. Its greatest development occurred in the 1970s; a major increase in furniture production took place thanks to investment spending totaling 15.5 billion old zlotys. Domestic sales grew fourfold at the time and exports increased eightfold. Commercial contacts with furniture distributors in Western Europe were established at the time. The crisis after 1980 and the reduced possibilities of the domestic market forced producers to reorient their production towards exports. The lack of funds for investment after 1990 led to rapid privatization in the sector on the basis of Western capital.

In the early 1990s, the first contacts were established with companies, primarily German. With time, these companies acquired controlling stakes in many Polish state-owned factories. For example, Germany's Schieder Gruppe bought Olsztyńskie Fabryki Mebli-renamed Mazurskie Meble International Spółka z o.o., as well as Bydgoskie Fabryki Mebli and Słupskie Fabryki Mebli, and also established upholstery plants in Bydgoszcz and Chełmno.

The company Klose bought Pomorskie Fabryki Mebli and Gościńskie Fabryki Mebli. Steinhoff bought Goleniowskie Fabryki Mebli, along with a plant in Szczecin, while Hartmann bought a plant in Milicz owned by Wrocławskie Fabryki Mebli. In all, German companies bought 25 percent of the state-owned furniture industry.

These are only some examples of privatization transactions in the Polish furniture industry. German and Swedish investors have displayed the greatest interest in the sector. The influx of funds has been used to carry out the necessary modernization projects and introduce modern technology. Access to export markets in EU countries became easier long before Poland's EU accession because most investors are large distribution companies with their own networks in Western countries.

After 1990, business opportunities for domestic capital expanded. Initially, small-scale furniture plants and the first small factories were established. Adriana appeared on the market in 1989 as a producer of wool blankets. An unknown company with wholly Polish capital signed a contract for the delivery of 30,000 blankets to Denmark. Production was started by six people; three years later the company had a work force of 300 and produced 3,000 items a day, becoming the largest blanket producer in Poland.

In 1993 it began to produce upholstered furniture. The first batches of sofas were ordered by Ikea, which earlier bought blankets from Adriana. Today the Adriana group is one of the largest sofa producers in Poland; 92 percent of its output is exported. Its furniture buyers include Ikea, Otto Versand and Skan Thor.

The Kler company has traveled a different path. Everything began in 1973 with a small upholstery plant employing two people. Before the company achieved its current position, it went through the natural stages of development from a small workshop to a modern business organization, says Piotr Kler, the founder and owner of the company. Kler was one of the first Polish companies whose products gained wider recognition. "Customers tend to have a better perception of products if there's a real person behind them. If a product is signed by the designer or bears the logo of the company, this is some kind of guarantee. Of course, this must be backed by quality," says Piotr Kler.

In 2000, the COM 40 upholstered furniture factory was established as a greenfield project in Salmierzyce near Kalisz. A production facility with an area of 20,000 square meters was built and a modern production line was imported, along with an Adler upholstery sewing machine and Lectra digital leather-cutting scanners. This year at the trade fair in Poznań the company presented a new brand of upholstered furniture, Noti, including Polish-designed models Mula, Slim and Estimo that will certainly find buyers abroad.

Polish office furniture producers are a separate case. Factories established in the early '90s such as Nowy Styl, Profim, Mikomax, MDD and Balma, successfully compete with Western producers today. Nowy Styl is the largest producer of office chairs in Europe; Profim sells its armchairs on the most demanding markets in the West, and Balma is building its distribution network in Germany.

There is no doubt that Poland has become a leader in furniture production over the past few years. This is one of the few products that Poland can boast internationally even though they are not always directly associated with Poland. With its quality and design, it rivals Western products and finds buyers on local markets. Figures speak for themselves. There is no doubt that the market trends for furniture makers are favorable.