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[Alpha Biz=(Chicago) Reporter Kim Jisun] Furniture companies such as Hyundai Livart, whose profitability has deteriorated due to the sluggish real estate market and rising costs, are taking out a series of price hikes.
According to the furniture industry on the 5th, Hyundai Livart raised the price of some items by 5%.
This year, wood prices such as particle boards (PB) and medium-density fiber plates (MDF) have fallen 3-5% from last year. However, Hyundai Livart explained that it decided to raise the price of the product because it is still about 30% higher than before COVID-19.
"Most of the furniture products that raised the selling price were steady-seller products released two to three years ago, and we set the initial selling price based on the price before the raw material hike," a Hyundai Livart official said. "We have been curbing sales price hikes by 2 to 5% every year amid a soaring cost increase of 30% over the past three years, but a slightly additional increase is inevitable this year," he added.
Hanssem is also considering raising prices for some products. An official from Hanssem said, "We are considering a price increase of 3% around mid-July due to factors such as rising labor costs for delivery and construction workers."
Hanssem and Hyundai Livart raised their product prices five times and three times last year, respectively. In January this year, the price of the product was raised, but the performance is still sluggish. Hyundai Livart posted 370.2 billion won in sales in the first quarter of this year, up 0.4 percent from a year earlier, but turned to a deficit with 7.6 billion won in operating losses.
In the case of Hanssem, consolidated sales fell 10.8% year-on-year to KRW 469.3 billion in the first quarter of this year. In particular, rehouse sales fell 30.8%. On top of that, it turned into a deficit with an operating loss of 15.7 billion won.
Alphabiz Reporter Kim Jisun(stockmk2020@alphabiz.co.kr)
