MASKO flood disaster: 20 percent decline in exports expected
The MASKO furniture factory in Istanbul’s Başakşehir district was severely damaged by the flood on September 5.
Mehmet Mutlu, chairman of the board of directors of MASKO, said that 40 of the 778 stores that exported significantly due to the flood were severely damaged and that MASKO’s exports would be reduced by 20 percent.
On the afternoon of September 5, flooding occurred in the northern districts of Istanbul following heavy rain. According to the first conclusions, 1,754 houses and workplaces were affected by the floods, 12 people were injured and 2 died.
The MASKO furniture factory in Başakşehir, Istanbul, was also affected by the flood. MASKO President Mehmet Mutlu informed Sozcu.com.tr that the 13th island, which is located at the lowest point in the area, was severely affected by the flood.
Mayor Mutlu stated that 40 of the 778 shops on the 13th island suffered serious damage, their basements were completely flooded with water and the water level on the ground floors reached 2 meters and 20 centimeters.
Stating that these stores have serious rent and staff expenses in addition to the flood balance, Mutlu said that the recovery and recovery of the stores will take time, but the MASKO board of directors has started taking initiatives.
MASKO, who held meetings with KOSGEB, met with the Minister of Trade and the Minister of Foreign Affairs and requested support for the region.
‘There WILL BE A DECREASE IN EXPORTS’
Mutlu claimed that each of the stores, whose products were rendered unusable and whose decorations were completely damaged, exported a significant amount and said that there will be a 20 percent decline in MASKO’s exports.
Providing information on the issue, Mutlu said:
“Companies that contribute foreign currency to the country’s economy through important exports were damaged by the flood. According to first estimates, losses per store amount to between 4 and 5 million lire. The furniture city exports to the whole world. About 10 percent of the country’s exports come from MASKO. Since the damage we received is 20 percent, there will be a 20 percent decrease in MASKO exports in a period of 2 to 3 months.”
WILL FLOOD DAMAGE CAUSE AN INCREASE IN FURNITURE?
Although the entire MASKO is believed to have been affected by the flood, 40 stores in just 1 street of the site, which has 20 streets and 778 stores, are severely damaged and 20 stores suffered minor damage.
Mutlu said that although the other stores on the site continue to operate, the perception that there is a “flood effect on all of MASKO” makes the consumer doubt the demand, which in turn hurts all of MASKO.
Although stores damaged by floods are expected to experience turnover losses in the domestic market as they need a period of 2 to 3 months to recover, no flood-related price increase is expected in the sector.
While Mutlu stated that there will be no price increase due to flooding, he also stated that there are constant cost increases due to inflation, and that the costs of staff increases and commodity increases are reflected in costs every 6 months, and that there is an increase in prices.
Federation of Furniture Associations (MOSFED) President Ahmet Güleç also said that there will be no reflection in the prices due to the flooding in MASKO, but if there is an increase in costs, it will be reflected in the prices.
INCREASE IN PRICE DECREASE IN DEMAND
Mutlu stated that for more than a year there has been a decrease in demand in the sector due to the increase in prices and stated that citizens who wanted to buy furniture were left waiting due to the country’s economic difficulties.
Mutlu stated that they have experienced a decrease in demand in the domestic market for more than a year: “The increase in prices reduced purchasing demand. The consumption of furniture remains in the background. “As purchasing power has decreased, the general consumer, except those who want to make urgent purchases, is not buying at this time, causing a decline in the market,” he said.