The Dutch industry is groaning under high costs, staff shortages and increasing international competition. A direct consequence: more and more factories are closing their doors, including within the interior industry. In the past six months, the lights went out at Dutch manufacturers such as BSM Factory, Matrassen Textiel Fabriek, Parketfabriek Van Kesteren and most recently at Dutch Mirror Factory. The big question is: what is going wrong?
The industrial sector now records the most bankruptcies of any sector in the Netherlands. Over 33 companies per 100,000 industrial enterprises went bankrupt in April, compared to 26 in the same month a year earlier. Energy-intensive production sites in particular are pulling the plug, under pressure from sky-high energy costs, rising wage costs and competition from abroad that can produce at significantly lower costs.
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Interior chain feels the impact
Although the hardest hit are heavy industries such as steel and chemicals first, the effects are quickly trickling down to sectors that rely heavily on domestic production. Furniture shops, upholsterers, kitchen specialists and suppliers of semifinished products are now feeling the pain. Less local production means longer delivery times, greater reliance on imports and rising price pressure.
'Higher energy costs affect all links in the industrial chain, including the manufacturing industry,' Albert Jan Swart, industry sector economist at ABN AMRO, told NU.nl. 'If companies scale back or even stop their investments, it disrupts the whole supply structure.'
Energy costs as a structural problem
One of the biggest culprits? The energy price. Dutch companies pay an average of 95 euros per megawatt-hour of electricity, dozens of euros more than in neighbouring countries such as Germany and Belgium. This structural lag is partly due to high grid tariffs and expensive electricity production via gas-fired power plants. For producers working with drying plants, presses or CNC machines (standard within interior production), these costs are barely sustainable.
The government offers some relief, including by freezing the CO₂ levy and scrapping the planned plastic levy. Yet business organisations VNO-NCW and MKB-Nederland are voicing criticism: the current energy rebates are insufficiently targeted at energy-intensive SMEs, leaving many interior companies out of the loop. 
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Double headwind
Besides energy prices, interest rates are also a major obstacle. Industry is capital-intensive; investments in machinery, automation and production sites are crucial. Since the 2022 interest rate hikes, these investments are a lot less feasible. For many smaller manufacturers or family businesses in the interior design industry, this means the difference between growing on or stalling.
'Moreover, the wave of inflation in recent years has made consumers more cautious,' says Swart. 'Less is being bought, which means manufacturers receive fewer orders. This reinforces the downward spiral.'
Residential sector under pressure
This is reflected in the residential sector economic barometer, which shows a gloomy picture. In April, the barometer fell to -8.7, the third decline in a row and the sharpest this year. Consumer confidence reached its lowest level in eighteen months, while manufacturers became more pessimistic about their order books and inventories. Sales at home furnishing shops fell again, although the contraction was less pronounced than in the previous month. This is a modest bright spot. The only positive indicator remains the housing market. In March, 6.4% more existing owner-occupied houses were sold than a year earlier.
Nevertheless, housing construction has slowed considerably in recent years. According to Erik Jansen, trustee in bankruptcy of Parketfabriek Van Kesteren, this played a role in the bankruptcy. 'The nitrogen crisis delayed new construction projects, which further reduced demand for parquet. In addition, competition from China and the loss of wood imports from Russia further weakened the business.'
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Staff shortage and collective bargaining tension
Another structural problem remains staff shortages. In many factories and workshops, vacancies remain unfilled for months. According to employers' association AWVN, there is an urgent need for foreign workers, but tax arrangements for expats are under pressure. Without an attractive business climate, the Netherlands is losing the battle for skilled talent, from furniture makers to logistics planners.
At the same time, labour costs are rising. In the interior design and furniture industry, tensions are rising. Trade union FNV issued an ultimatum on 9 May to industry body Royal CBM, threatening actions if wage increases and better working conditions are not agreed to. CBM calls the demands "unfeasible and unwise" and claims to have previously made a "competitive and constructive final offer". According to the industry association, operating cautiously is necessary under the current economic conditions.
Lack of clarity inhibits choices
What particularly bothers entrepreneurs is the lack of clarity from the government. 'For investments that last 10 to 20 years, companies need consistent and future-oriented policy,' AWVN said. 'When foreign investors compare the Netherlands with other countries, the Netherlands should stand out favourably. That is often not the case now.'
For the interior industry, this means that suppliers may choose to take their production elsewhere or stop altogether. The result: less supply, higher purchase prices and greater reliance on imports, often at lower quality standards and with uncertain delivery times.
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