Sustainability is no longer just an ESG goal but increasingly a market force that businesses have to embrace to attract potential consumers. Ernie Koh, executive director of sales and marketing from Koda, an original design manufacturer of furniture, shares how the company turns sustainability into a competitive advantage.
By Yap Shi Quan
Embracing “what the market wants”
Sustainability is increasingly becoming indispensable in a company’s branding or business strategy. Market research studies by various organisations, including World Wide Fund for Nature (WWF) and First Insight, have revealed that consumers want their products to be certified sustainable, with a sizeable amount of them willing to pay more.
Ernie Koh, executive director of sales and marketing for Koda, noticed this phenomenon in the US, Europe and Asia-Pacific, which are also the markets Koda serves. He explained: “I think these countries, being more progressive and industrialised in their markets, are embracing sustainability seriously where they have to consider sustainability as part of their purchasing decision — so much so that many of our customers started coming to us a couple of years ago wanting that. And you have to embrace what the market wants.”
Koda began in 1972 as a woodworking workshop and an original equipment manufacturer (OEM) of furniture, before transitioning into an original design manufacturer (ODM) currently. The manufacturer also has a lifestyle- and design-driven retail brand called Commune Lifestyle that sells globally, and has approximately 80 shops in China.
During the period of the pandemic when lockdowns and factory shutdowns were still the norms, Koda fared relatively well due to the boom in demand for home furnishing. Koda’s Commune warehouses got empty as there was widespread buying by customers, but ultimately, the company faced logistic issues, such as the increase in freight costs and manpower shortage, particularly for their factories in Vietnam and Malaysia.
Now, as borders are opening up, Koh expressed that at least in the lifestyle aspect, the world will not return to the pre-pandemic state, having experienced what he calls “suburban urbanisation”, where urban people will experience a more suburban living, and the suburban people will experience a more urbanised lifestyle. This has an impact on the furniture and home furnishing industry, in particular, suburban malls and shopping centres in the city, and the living and working space which have become close to each other. The business implications of these excites Koh. Even so, he is still cautious about how the post-pandemic world will turn out.
This article first appeared in the May/June 2022 Issue of Panels & Furniture Asia. To read the rest of the article, click here.
Banner image: Singapore Business Federation