After all, they have to provide the goods for the burgeoning Millennial generation buyer - whose preference for online shopping, customization and rapid turnaround presents challenges.
A table from a recent report by Hong Kong-based Fung Business Intelligence shows annual furniture U.S. furniture sales by company. Ashley Furniture is the company at the top, whose strong retail presence in China is suggested by the fact theirs is the only name presented in Mandarin.
The right hand column is the percent change between 2013 and 2014. Online furniture retailers like Wayfair and venture-funded start-ups like Greycork are described as 'subversive' market players.
The research business that prepared this report is an arm of Fung Holdings Limited, a privately-held business entity headquartered in Hong Kong, whose core businesses are engaged in Trading, Logistics, Distribution and Retailing. It has $24 billion in revenue and 45,000 employees, with its logistics and warehouse operations touching on the furniture business.
This report summarizes the status quo of the US furniture and home accessories industry, and focuses on the US consumer's changing characteristics, and in the subversive players entering the market.
Since the financial crisis, the economy has entered a recovery phase, the US economy maintained a good growth rate, and the labor market also continues to improve. This has contributed to strong growth in the residential market, residential sales and prices.
A corresponding wave of promotion of furniture and home accessories grown sales since August 2013.
In August 2015, sales of furniture and home accessories increased by nearly 8 percent due to stable economic outlook.The current annual turnover of $960 billion for the furniture industry's medium-term outlook is optimistic. In a recent article in Furniture Today the magazine expects the industry to see a compound annual growth rate through 2019 of 2.9 percent.
But this process will not be smooth sailing. Furniture retailers need to take into account the generation of replacementproblem. Currently represents the largest consumer group of the Millennium generation, home ownership and home furnishings of the state.
Degrees and predecessors are not the same. Productive labor market housing affordability, student debt to and the sharing of economic development, all of them have delayed the independent living and home ownership of young people. This means Millennials often find smaller, multifunctional and affordable furniture to complement theirDynamic and changeable urban lifestyle, retailers need to be flexible to respond to this demand. In addition, as more and more customers find information online and shopping, so furniture companies need to address the growing
mature multi-channel environment, continue to make adjustments.
EMarketer data show that online furniture sales will grow at an annual rate of 11 percent and reach $ 32 billion by 2018 and continued to erode the market share of established retailers.
The multi-channel market driven by Millennial demand is very attractive to new, disruptive enterprises. The final section of this report lists a number of innovative furniture companies and divides them into three categories: design and assembly innovations, new technologies and smart furniture, and new business models.
In the first category companies such as Greycork provide design solutions to add to the assembly of products to the customer's attraction; and in the second category, Cimagine and other start-ups provides retail links to enhanced real-world (AR) and virtual reality solutions, both physically and online. In the last category of the San Francisco start-up Move Loot is built established online second-hand furniture market, it will likely take some of the mass-market retailers' business.