Bangkok--30 Sep--m1network The largest ever in Asia’s furniture industry, the 15 billion baht - worth contract will boost S.P.S. Group’s production and logistics capacity as part of IKEA’s global alliance strategy in Asia. S.P.S. Group, one of Thailand’s largest furniture manufacturing companies, has made another major milestone for Thai and Asia’s furniture industry as the company signed a 15 billion baht - worth agreement with the giant Swedish furniture and home product retailergroup IKEA to become manufacturing and supply chain management hub for IKEA in Asia, western coast of the U.S.A. and parts of Europe. According to the deal which is the largest evr in Asia’s furniture industry history, S.P.S. Group will make at least 1,200 million baht investment to increase its manufacturing facilities and incorporate advanced furniture automation technology into the production. S.P.S. Group also pioneered use of lowest cancer-causing formaldehyde content board materials that complies to content requirement standard in Germany , Scandinavia and America. Mr. Kerati Sermpraphasilp, president of S.P.S. Group, said that Sweden-based international furniture retail group, has awarded S.P.S. Intertech Co., a leading OEM of DIY panel furniture manufacturer in the country, with sales contract worth over 15,000 million baht for five consecutive years . The contract is one of the largest furniture deal ever committed in Asia by giant furniture retailer IKEA, and is part of the brand’s strategy to expand its global supply chain in rapidly growing Asian markets.According to Mr. Kerati, the deal resulted from S.P.S.’s outstanding performances during the past 20 years as reliable supplier with mass volume capacity, on time delivery, high product quality, and competitive prices for international markets. “S.P.S. Group and IKEA enjoy a close relationship as business partners for over two decades. During those years, S.P.S. Group has made a number of significant achievements such as winning excellence awards and certificates recognizing the company as one of IKEA’s best OEM furniture suppliers. Trade value between S.P.S. and IKEA steadily increased over the years. So this new business agreement marks another accomplishment that we at S.P.S. take great pride of as we are the first Thai panel furniture manufacturer to be play a important role in IKEA’s strategic expansion in Asia. We are assured that this agreement will also make a significant contribution to Thailand’s furniture industry and overall economy as well, “ said Mr.Kerati. Mr. Werasak Sermprapasilp, managing director of S.P.S. Intertech, said that the contract, which is signed by IKEA and S.P.S. Group, will enable the Thai company to spend at least 1,200 millon baht solely for the improvement and modification of exit manufacturing plants, construction of new plants and the largest distribution warehouse, with total area spanning over 34.000 sq. meter. S.P.S. Group’s expansion plan also includes installation of new machineries incorporating the latest full automation production technology from Germany which will enable the company to manufacture innovative products for the next generation. With the new technology being put in place, S.P.S. Group’s annual production output will reach 3.500,000 units or 5,000 containers. Apart from expanding production capacity, S.P.S. will also serve as center of global supply chain management for IKEA products in all parts of Asia, western U.S.A. and part of Europe. Following this agreement, S.P.S. Group will also become one of largest panel furniture manufacturer in Asia with annual production output worth more than 5,000 million baht, making up 24% of Thailand’s wooden furniture exports or 12% of total furniture exports volume The main source of materials used by S.P.S. Group is particle boards locally produced in Thailand. The main particle board has the lowest formaldehyde content emission of less or equal to 4 mg/100 material, Japanese ( F **** ). This is the new and strictest legal requirement for formaldehyde emission of all Ikea’s furniture products that complies with international legal requirement in Germany, Scandinavia and America. Therefore, S.P.S. Groups will be the first panel furniture manufacturer in Asia to use panel boards that are friendly to the environment, and less harmful to human health, especially in terms of cancer-causing risks. This will be a good start for Thai panel furniture industry to enhance quality and safety standard of their products in the future. Established in 1966, S.P.S. group of companies ( formerly known as S. Praphasilp Group of Companies ) is one of Thailand’s largest manufacturer and exporter of wooden furniture products. The Group comprises S.P.S. Cooperate Ltd. and S.P.S. Intertech Co., Ltd. which produce a fully knock- down panel furniture , in which, the main production raw materials usage , are laminated particle and medium density fiber boards, with annual production output of approximately 1,500,000 units or 3,000 containers. The main production products are T.V. stands, bookshelf, bedroom, desks, kitchen, entertainment units, etc. S.P.S. Group exports products to more than 35 countries worldwide, with major markets being Japan, U.S.A. and Europe. Sweden-based IKEA is the world’s largest furniture retailer specializing in stylish but inexpensive Scandinavian and American designed furniture. The company has 285 and close to 300 stores by year-end of 2008 (based on 2007 figures), which are visited by over 538 million people yearly. IKEA’s worldwide sales were approximately Euro 20 billion in 2007. The company publishes and distributes free 191 million copies of free catalogue printed in more than 25 languages, and circulated in more than 36 countries. IKEA’s success in the retail industry can be attributed to its vast experience in the retail market, product differentiation, and cost leadership. The company is, perhaps, one of the world’s most successful multinational retailing firms, operating as global organization based on its unique concept -- furniture is sold in kits that are assembled by the customer at home.