Chinese furniture industry has beco- me the world's furniture manufacturing center after a rapid period of development in the past 25 years. China also has become the world's largest furniture pr- oduction and export country. However, most of the furniture enterprise haven’t strong competitiveness. How to enhance the competitiveness and cultivate the core competence of furniture enterprise has become the focus of discussion by furniture industry and academia. This paper will diiscuss how to identify and cultivate the core cometence from the concept and characteristics of the core competence combined with the characteristics of the furniture industry, then study how to improve the core competence with Diamond Model.