The Russian Furniture Industry: Firms' Upgrading According to the Value-Chain Theory

Abstract

The Russian furniture market is demonstrating fast and stable growth, which is both attractive and promising. At the same time, most Russian furniture producers exhibit insufficient and inconsistent restructuring. Taking into account the results of in-depth, semi-structured interviews with different types of furniture market participants (furniture producers, including downstream integrated and specialised; retailers; and suppliers of raw materials) the paper describes the restructuring strategies of domestic firms in the framework of the valuechain theory. Particularly, the article aims to explain the obstacles for Russian producers to upgrade as suppliers of specialised products, or parts of products, despite the experience of successful restructuring in the furniture industry of the former socialist countries in East Europe that resulted from a fragmentation of production.