BULGARIAN FURNITURE CLUSTER A GOOD PRACTICE

Ms. Genoveva Christova Chairperson

Background G.Christova
2001 2007 Executive Director of the Branch Chamber of Woodworking and Furniture Industry in Bulgaria 2005 2006 Chairperson of the first pilot cluster in Bulgaria Furniture of Trojan Since 2008 Chairperson of the Bulgarian Furniture Cluster Since 2009 Chairperson of the Association of Business Clusters in Bulgaria Bulgarian Entrepreneur of the Year 2010 award during the SME week, Brussels

Bulgarian experience in clusters development

1. First attempts 2001 2002 . (PHARE, GTZ) Cluster Mesta, South-West wood processing and furniture Plovdiv region perfumery and essential oils Bulgarian Rose Russe region Wine cluster
Wine

IT

Cluster Mesta

Perfumery and essential oils

Bulgarian experience in clusters development

2. Introduction of cluster approach and establishment of a pilot cluster model 2005 2006 (PHARE) Made in Troyan Rodopi tourism ICT Sofia
Pleven Apparel&textile Veliko Turnovo Historical/religious tourism Wine production Sofia IT Software Biotechnology Creative industry Electronic assembly Finance Automatic&packaging machinery Tourism Congress / Leisure Tourism - Historical / Religious Meat processing Pernik Eco park Troyan Furniture Eco/village tourism Gabrovo IT Historical/Eco/ Village tourism Rousse Clothing production Silk growing Auto-part products Grain Wine Dobrich Agro-processing Shoe production

Isperih Friut&Vegetable processing Devnia Chemicals

Varna IT/Contact centres Maritime Biology Beach tourism Sunny Beach Beach tourism Sliven Clothing/Socks production Carpets Wine Stara Zagora IT Agroprocessing Energy Valley of Roses Essential oils Kardjali Perperikon Historical/ religious tourism Haskovo Clothing production

Razlog Furniture Sandanski Spa Tourism Smolian Village/winter tourism Plovdiv Agro-processing Lasers

Melnik Wine

Velingrad Furniture , herbs Pazardzhik Agroprocessing Srednogorie nonferrous metals Wine

Lessons learned

First pilot cluster Furniture of Trojan

Structure of the cluster ( map): 11 SMEs + High School + NGO + Municipality Achieved results Main problems

Pilot Cluster map

Horizontal linkages Industry Supportin g suppliers Supporting institutions, infrastructure National forest agency machinery , fuels NGO's, Road and rail unions

Vertical linkages

Resource

Forest companies, forest owners Contactor base, private and state harvesting companies Sawmills Companies N 10,11,15 as per memorandum

Harvesting and transport

Primary processing

machinery , fuels

NGO's, Universities, Training centers, Proffessional schools

Secondary processing

Panels, timber components Companies N 5, 6, 7, 8, 9, 12, 13, 14 as per memorandum

wholesalers, retailers consumers, builders, b2b contractors, paper&wood producers

machinery , fuels, chemicals

NGO's, Universities, Training centers; Proffessional schools

Gov.Agencies, NGO's, Gov.Agencies, Health and safety agencies Gov.Agencies, Health and safety agencies, NGO

Distribution Consumption

advertisin g, logistic consumer groups machinery , fuels, chemicals

Waste management, recycling

Who are we?

Bulgarian Furniture Cluster is a national based business organization, established in 2008. Members of the cluster are 22 SMEs furniture manufacturers, 5 design studios, 2 NGOs and 2 educational institutions, that have decided to join their resources, capabilities and potential with the purpose to increase their competitiveness at foreign markets.

Why cluster?

How to stay competitive in increasing competition? How to keep pace with Europe? How to be noticed when coming from a small country?

Why cluster?
Specialization COMPETITIVE ADVANTAGES Increased capacity and complementary work ( joint orders) Reduced costs + synergy : common purchase of materials, common supply, etc Efficiency Common marketing

Why cluster?
Flexibility Complexity Innovation and R&D Economy of scale Increased competitiveness - EXPORT

Economic data 2010

Aggregate turnover of more than 50 mln. Euros 4 SMEs above 50% from their turnover Aggregate employment of 2650 people Economic growth of 12% ( first 6 months of 2011)

How we are doing it?

Strong leadership Co-ordinator (Ambitious + Energetic) 2 or 3 sub-groups (depends on the size) Sharing information and resources Equal treatment of each member (neutrality) Mutual trust!

What we are doing?

Business planning: set up objective targets Regular meetings: 4 to 5 per year (70% attendance) Member visits (round tour): get to know each other better Focus groups: marketing; design/trends; HR/education Networking and sector representation at national and international level - Membership in ABC (Association of Business Clusters) - Partnership with Cluster Land, Holz Cluster, etc

Clusters activities

Joint Marketing Activities - Fair participation, like: - The Sleep Event London 2010 - Milano Design Week 2011 (via Tortona) - imm Cologne 2011 Trade missions Holzcluster Austria; The Chair Triangle in Italy

The Sleep Event - London 2010

Main results!
Intensive usage of IT applications in furniture production 65 % from the members Intensive work with designers branding, identity, vision! Sofia Design Week 2011

52 furnished hotels in Germany for 5 years!!! Peugeot admin offices Business Centers in Hannover and Cologne

RESULTS: 2006 - 2011

5 685 hotel rooms in Europe Preferred supplier for 2 Hotel Groups in Germany

RESULTS: 2006 - 2011

Business Design Center Hannover Administrative Offices of Peugeot, France CITROEN Racing Service, France

RESULTS: 2006 - 2011

Dining sets for 12 Home Furniture Stores in Finland

Clusters activities
Design workshops Black Sea 2010 & 2011 Joint master degree in Design (ISIA Florence + NBU Sofia); graduate placements Projects

Design workshop Black Sea 2010

Branding
Creation of identity critical success factor for the future of our business!!! CHANGES our first brand, design by Mirko Tattarini

Growing potential!
Tender for furniture equipment of 6000 rooms in the Olympic village Sochi 2014 300 Showrooms of Citroen in France by the end of 2012

Conclusions!
The myth of Balkans individualism or business development via direct competition! The competitive advantage + specialization of each company in the group! Strategic approach and new way of thinking Branding and identity Being noticeable beyond your own borders!

Thank you very much for your attention!

www.ligna-group.com