According to statistics from Euromonitor, the functional sofa in the overall market of Chinese sofas in 2017 accounted for 12.4%, compared with 39 to 40% in the mature US sofa market. Faced with the huge market prospects of China's functional sofas, leading sofa companies at domestic and abroad have joined the competition.
Minhua Holdings (01999-HK), which opened the first Chivas function sofa in Shenzhen in 1996, is undoubtedly the "famous brand" in China. In terms of volume, in China, Man Wah Holdings has occupied the largest market share of the software furniture industry. In the US market, Man Wah Holdings has been figured into the top 3.
In the Chinese sofa market share, Man Wah and Kuka are ranked first and second in the Chinese sofa market, with 4.12% and 3.36% respectively. Kuka has nearly 4,000 stores nationwide, and Man Wah has a total of 2,516 stores based on its September 2018 earnings report.
Between 2016 and 2018, Man Wah Holdings’ business in the Chinese market increased rapidly from 33.50% to 48.20%, which exceeded the US market. According to the company's announced investment plan at the Shenzhen International Furniture Fair in 2019, the layout of the first-class and second-tier cities in the mid- to high-end market is saturated. The area targeted for this year's investment plan is the market of the third and fourth lines of city in China.
In order to reduce the impact of Sino-US trade frictions, Man Wah Holdings has already acquired plants in Vietnam in advance since June 2018. It is expected to double the area of Vietnam plants to 373,000 square meters by the end of 2019, and it is expected that by the end of 2020, All products exported to the United States will be produced in Vietnam.
On the other hand, in the day before the opening of Shenzhen International Furniture in 2019, Man Wah Holdings held a global partner thank-you banquet. The chairman of the board of directors, Huang Minli, made a bold statement in front of the partners, saying that Man Wah Holdings will in 2019 open another 1,000 stores.