welcome back to china price watch we're talking about china's furniture industry faced with an economic slump and an unfavorable policy climate the Chinese furniture industry has hit a rough patch industry statistics show that ninety-five percent of firms have seen declining profits over the past year Hong Kong's royal furniture recently announced a ninety percent drop in profit for the first half of 2012 the company is just one of many that is now fighting for its life amid low demand in 2011 total sales for large furniture dealers decrease 7.66 percent that was the first time in five years that sales have seen a decline inch engine alone 2011 so the closure over 70 small and medium-sized furniture company but omits the time all 21 foreign brand seize opportunities for expansion IKEA the Sweden-based home products company already has a foothold in the Chinese market is looking to dig deeper it. opened its first china operation in shanghai 1998 but over the following decade it's on moderate growth throughout the country opening a total of eleven outlets over forty years the initially slow sales were partly due to a policy of pricing all good according to IKEA international prices it meant that for its first five years IQ was essentially a white-collar outlet for those with a taste in for in Design that all changed in 2002 when the company side to bring down its prices in china and open up the store the china's rising middle class IQ's trademark lack table originally went for 120 R&B in 1998 but now sells for a third of the price 39 R&B or just six dollars IKEA prices for a range of products have fallen by as much as 60 percent Gillian drake for the head a bite he is china branch told the Wall Street Journal that the lower prices are partly the result of shifting production to china globally just 30 percent about his products are made in china but sixty-five percent of domestic sales are sourced in china this is allowed prices on products like he is compact storage drawer to drop form seven dollars and seventy cents to just four dollars and fifty cents Chinese consumers have responded by embracing the compact lifestyle the core that ITSI's Chinese IQ's have seen a 20 percent rise in sales over the past year while interviewing Beijing as for today's question of the day we actually found many people believed IQ was itself a domestic Chinese Brandt IT is trick for reports that the Beijing store has four times the weekly visitor a bit stores in Western Europe and Crush of visitors is leading them to expand I he is looking to open six new outlets by 2015 including a second store in Beijing don't go away because up next is our question of the day stay turned me wall