Amid globalization, the overseas wedding furniture market, with its unique cultural appeal and vast consumer demand, has become a key direction for many furniture enterprises to expand their businesses. However, in this seemingly promising market, enterprises are trapped by two major pain points: high minimum order quantity (MOQ) thresholds and severe stockpiling. These two issues, like two huge mountains, make capital flow extremely difficult for enterprises, and many have thus fallen into development predicaments. Today, we will deeply analyze these pain points and present 3 practical, flexible supply chain solutions to help enterprises easily reduce capital pressure.
I. Market Pain Points of Overseas Wedding Furniture: The Dual Dilemma of High MOQ and Stockpiling
For enterprises engaged in the overseas wedding furniture market, the troubles caused by high MOQ and stockpiling are far beyond imagination. First, regarding high MOQ, when ordering wedding furniture, overseas customers usually set high MOQ standards for cost control and transportation convenience. This means that to secure an order, enterprises must invest a large amount of capital at one time to purchase raw materials and organize production, which is undoubtedly a huge financial test for small and medium-sized furniture enterprises. Moreover, high MOQ is accompanied by high risks. If market demand changes subsequently or customers breach contracts, the early investment of enterprises may be completely lost.
Then there is the problem of stockpiling. Wedding furniture has strong seasonality and timeliness. For example, demand is strong during peak wedding seasons and plummets in the off-season. Once enterprises misjudge market demand and produce excessive furniture products, stockpiling is likely to occur. This overstocked furniture not only occupies a large amount of warehouse space but also requires high storage and management costs. More importantly, a large amount of capital is tied up, preventing enterprises from investing capital in more critical links such as new product research and development and market expansion, which seriously affects the capital turnover efficiency and overall competitiveness of enterprises.
Data shows that in the overseas wedding furniture industry, an average of 20%-30% of capital is occupied by stockpiling. Some enterprises even have their capital chains broken due to inventory problems and are eventually forced to withdraw from the market. It is thus clear that solving the problems of high MOQ and stockpiling has become an urgent task for the survival and development of overseas wedding furniture enterprises.
II. 3 Flexible Supply Chain Solutions to Solve Cash Flow Problems
As a supply chain model that can quickly respond to changes in market demand and flexibly adjust production and supply plans, the flexible supply chain provides an effective way to solve the pain points of overseas wedding furniture enterprises. The following are 3 proven flexible supply chain solutions to help enterprises reduce capital pressure and enhance market competitiveness.
Solution 1: Combine Modular Design with Standardized Production to Lower MOQ Thresholds
Modular design refers to splitting each part of wedding furniture into independent modules, such as the armrests, backrests, and cushions of sofas, and the tabletops and legs of dining tables. Each module adopts standardized production processes and size specifications. Enterprises can freely combine these modules according to different customer needs to quickly produce personalized products that meet customer requirements.
The advantages of this design method are as follows: On the one hand, standardized module production can improve production efficiency and reduce production costs. Since the production process and size of each module are fixed, enterprises can achieve large-scale mass production, thereby reducing the production cost per unit product. On the other hand, modular design enables enterprises to flexibly meet customers’ small-batch order needs. When customers need small-batch and personalized wedding furniture, enterprises only need to combine the pre-produced standard modules according to customer needs, instead of redesigning and producing the entire product, which greatly lowers the MOQ threshold.
For example, after adopting modular design, an overseas wedding furniture enterprise reduced the MOQ of wedding sofas from the original minimum of 50 sets to 10 sets. Customers can choose modules of different colors and materials to combine sofas according to their wedding scale and style. After receiving an order, the enterprise can complete production and delivery in only 3-5 days. This not only meets customers’ personalized needs but also attracts a large number of small and medium-sized customers. The order volume increased by 40% year-on-year, and the capital turnover efficiency was also significantly improved.
Solution 2: Establish a Shared Inventory Platform to Optimize Inventory Allocation
A shared inventory platform is a unified inventory management platform jointly participated in by multiple overseas wedding furniture enterprises in the industry. Enterprises upload information about their inventory products to the platform, including product name, model, quantity, price, storage location, etc. When a customer needs to purchase wedding furniture, the platform can quickly match the enterprise closest to the customer with sufficient inventory according to the customer’s needs and geographical location, realizing the sharing and allocation of inventory products.
For enterprises participating in the platform, the shared inventory platform brings many benefits. First, it can effectively reduce enterprise stockpiling. Enterprises no longer need to stock up in large quantities to meet potential customer needs; they only need to maintain a reasonable safety stock. The extra warehouse space and capital can be used for other business development. Second, the shared inventory platform can improve inventory turnover. Through the platform’s resource allocation, enterprises’ inventory products can be sold faster, reducing capital occupation and storage costs caused by stockpiling. Finally, the shared inventory platform can also reduce the market risks of enterprises. When market demand fluctuates, enterprises can quickly adjust their inventory structure through the platform to avoid capital losses caused by stockpiling.
Take a shared inventory platform for overseas wedding furniture in Southeast Asia as an example. Currently, more than 50 furniture enterprises have settled on the platform, covering various categories of products such as wedding sofas, dining tables, dining chairs, and wedding props. Since the platform was launched half a year ago, the average inventory turnover rate of settled enterprises has increased by 35%, the stockpiling rate has decreased by 25%, and the capital pressure on enterprises has been significantly alleviated. At the same time, because the platform can quickly respond to customer needs, the customer order delivery cycle has been shortened from the original 15-20 days to 5-7 days, and customer satisfaction has also been greatly improved.
Solution 3: Adopt the “Production-to-Order + Pre-Sale” Model to Reduce Blind Production
The “production-to-order + pre-sale” model means that enterprises first predict the market demand for wedding furniture through market research and customer demand analysis, and then formulate production plans based on the prediction results. At the same time, enterprises carry out pre-sale activities through online and offline channels to collect customer order information in advance and adjust production plans according to the actual order quantity of customers to achieve production on demand.
The core of this model is that enterprises can arrange production according to the actual market demand, avoiding the problem of stockpiling caused by blind production. During the pre-sale stage, enterprises can attract customers to place orders in advance by displaying product samples, providing detailed product introductions, and offering preferential policies. After customers pay a certain proportion of the advance payment, enterprises organize production according to the order situation. After production is completed, customers pay the remaining amount, and enterprises deliver the products.
The “production-to-order + pre-sale” model can not only reduce enterprise stockpiling but also lower capital pressure. On the one hand, through pre-sales, enterprises can obtain part of the capital in advance for raw material procurement and production processing, reducing reliance on their own capital. On the other hand, production on demand means enterprises do not need to stock up in large quantities, reducing capital occupation in inventory and improving the efficiency of capital use.
For instance, a well-known domestic wedding furniture enterprise adopted the “production-to-order + pre-sale” model when expanding its overseas market. The enterprise carried out pre-sale activities through overseas social media platforms and cooperation with local wedding companies. Customers only needed to pay a 30% advance payment to book wedding furniture products three months later. The enterprise formulated detailed production plans based on pre-sale orders to ensure the timely delivery of products. After adopting this model, the enterprise’s stockpiling rate decreased from 30% to less than 5%, the capital turnover cycle was shortened by 2 months, and at the same time, due to its ability to accurately grasp market demand, the product’s market share continued to increase.
III. Suggestions for Implementation: Ensuring the Effective Implementation of Flexible Supply Chains
To ensure the smooth implementation of these 3 flexible supply chain solutions in enterprises and achieve good results, enterprises also need to do a good job in the following aspects:
First, strengthen the collaborative cooperation of all links in the supply chain. The implementation of a flexible supply chain involves multiple links such as raw material suppliers, manufacturers, logistics enterprises, and sales channels, which require close cooperation and coordination. Enterprises should establish a sound supply chain collaboration mechanism, strengthen communication and exchanges with partners, and share information promptly to ensure the smooth operation of all links in the supply chain.
Second, increase investment in information technology. Information technology is an important support for the implementation of flexible supply chains. Enterprises should introduce advanced supply chain management systems, ERP systems, big data analysis systems, etc., to realize real-time monitoring and management of all links in the supply chain. Through big data analysis, enterprises can accurately predict market demand, optimize production plans and inventory management, and improve the response speed and flexibility of the supply chain.
Finally, focus on talent training. The implementation of a flexible supply chain requires professional talent support. Enterprises should strengthen the training and introduction of supply chain management talents to improve the professional quality and business capabilities of employees. Through internal training, external recruitment, and cooperation with universities, enterprises can cultivate a group of compound talents who understand both supply chain management knowledge and the characteristics of the overseas wedding furniture market, providing strong support for the implementation of flexible supply chains.
In conclusion, in the face of the capital pressure caused by high MOQ and stockpiling in the overseas wedding furniture market, as long as enterprises actively embrace the flexible supply chain model, select appropriate solutions according to their actual situations, and do a good job in various supporting work during the implementation process, they will surely be able to solve the problem of capital pressure and achieve the sustainable development of enterprises. It is believed that with the help of flexible supply chains, more overseas wedding furniture enterprises will stand out in the international market and win greater development space.
