During the economic recession, the furniture retail industry was negatively impacted as consumers cut back on non-essential spending, but now there is an uptick in demand. In fact, the U.S. furniture industry has outpaced the U.S. economy in recent years. While the housing market improves and discretionary spending increases, we will see this growth continue. By 2019, the global market for furniture and floor coverings is forecast to reach $695 billion.
Several key industry trends have emerged, as new innovation and shifting consumer preferences influence the demand for furniture. Read on to learn more about the top trends that are shaping the furniture industry.
1. The rise of telecommuting is driving the demand for home office furniture.
The need for home offices increased during the financial crisis in 2008-2009 and the European debt crisis in 2011-2012, driving increased demand for computers, desks, office chairs, and filing cabinets. Consumers quickly found that their home offices had multiple uses, and they often preferred to buy versatile furniture that could cover up office equipment when not in use. As a whole, the market for global home office furniture is forecast to grow at a compound annual growth rate (CAGR) of 5.58 percent between 2014-2019.
2. Multi-functional, versatile furniture is gaining popularity.
The number of single- and two-person households has been increasing, resulting in the demand for small and portable furniture. Consumers have also been looking for furniture that is multi-purpose, foldable, and technology-driven, especially when it comes to living in smaller spaces.
3. Online is the fastest-growing channel in developing markets.
The U.S. home furnishings store industry includes about 15,000 stores with combined annual revenue of about $27 billion. The industry is extremely concentrated, with 50 of the largest U.S. stores accounting for 75 percent of the industry revenue. But, the competition is rising. Online stores are becoming the fastest-growing channel at a CAGR of 16.6 percent. Many companies are putting more efforts towards their online retail stores, by adding benefits for consumers who shop online such as free delivery and installation and even same-day pick up.
4. The demand for luxury furniture is increasing.
As the economy has grown, more consumers are willing to buy luxury items for their living and work environments. The global luxury furniture market is expected to grow at a CAGR of over 4 percent between 2015-2019. In terms of location, Europe has the largest market for luxury furniture, but developing countries such as China and India are not far behind.
5. More furniture vendors are choosing to go green.
With luxury comes the expanding trend to go green. Many vendors are developing eco-friendly furniture. This trend is driven by environmental concerns, such as the problem of deforestation. Although eco-friendly furniture is more expensive, the demand is on the rise, making it worthwhile for manufacturers and companies to offer these products.
To learn more insights, check out our free e-book House & Home: 27 Top Trends and Predictions.
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