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Factoids

Factoids offer brief snapshots of current topics pertinent to the Furniture industry based on our on-going research. Increase your grasp of current trends, consumer attitudes, and shifts within the industry through solid statistics and concise insight.

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Factoids

Distribution Channels: Percent of Sales by Distribution Channel by Product

This is the fourth factoid in a series detailing the Furniture Industry’s Distribution Channels.  Factoid #4 shows the percentage of products sold in each distribution channel.

 

Furniture and Home Furnishing Stores.  Traditional furniture stores along with specialty furniture retailers and home furnishings stores sold almost equal amounts of Upholstery (35.9%) and Living Room, Dining Room, and Bedroom (32.7%). Bedding is also a staple item in this channel at 23.2% of Furniture and Bedding sales, while there were fewer sales of Home Office and Computer Related (5.2%) and Outdoor and Patio (3.0%).

 

Electronic Shopping (Internet).  Although the highest percent of Furniture and Bedding sales in Electronic Shopping belongs to Living Room, Dining Room, and Bedroom Furniture at 32.7%, the other 4 main products are all between 14.0% and 19.1% of this distribution channel’s total sales.  The distribution of sales of each main furniture category is the most balanced in the Electronic Shopping.

 

Warehouse Clubs and Supercenters.  These big box stores sell a mix of Home Office and Computer Related (36.1%), Living Room, Dining Room, and Bedroom (35.3%), and Outdoor and Patio (25.7%).  Very little Bedding (1.7%) and Upholstery (1.2%) is sold through this channel. 

 

General Merchandise Stores.  The five main furniture categories are well distributed in General Merchandise Stores with Upholstery being the majority at 34.7% and the exception of Home Office and Computer Related Items only contributing 2.8% of sales.

 

Discount Department Stores.  The vast majority of Discount Department Store furniture and bedding sales occur in the Living Room, Dining Room, and Bedroom category at 86.5%. Outdoor and Patio are 10.4% of sales, while the remaining products are 3.1% combined.

 

Home Centers.  Outdoor and Patio furniture is mostly sold in Home Center and Other Building Material stores – accounting for 56.2% total furniture and bedding sales in this channel.  The channel also sold 20.8% in Living Room, Dining Room, and Bedroom and 14.5% in Home Office and Computer Related items. 

 

Department Stores.  Bedding is still the largest segment of furniture products sold in Department Stores at 56.3% of product mix. 

Other product mixes include 17.5% of sales in Upholstery, 15.8% in Living Room, Dining Room, and Bedroom, and 10.3% in Outdoor and Patio. 

 

Distribution Channels: Percent of Sales of Product by Distribution Channel


 

 

This is the third factoid in a series detailing the Furniture Industry’s Distribution Channels. Factoid #3 determines the percent of sales of a product by each main distribution channel.

 

Upholstery.  The vast majority of Upholstery is sold in Furniture and Home Furnishing Stores– 83.9% in 2012.  8.6% was sold through Electronic Shopping, while General Merchandise stores accounted for 4.2% of Upholstery Sales.  The remaining distribution channels each made up less than 1.5%.

 

Casegoods.  With 60.4% of Living Room, Dining Room, and Bedroom Furniture Sales, Furniture and Home Furnishing Stores are the primary distribution channel for these products. 14.4% are also sold through Electronic Shopping, while 7.0% sells in Discount Department Stores and 4.0% in Warehouse Clubs and Supercenters.

 

Home Office and Computer.  The primary source of Home Office and Computer Related Sales are divided between Furniture and Home Furnishing Stores at 35.3%, Electronic Shopping at 31.0% and 15.1% sold in Warehouse Clubs and Supercenters.

 

Outdoor and Patio.  The majority of Outdoor and Patio sales were sold online making Electronic Shopping 33.8% of distribution.  23.0% of sales occurred in Furniture and Home Furnishing Stores, 15.0% in Home Centers and Other Building Materials, 11.9% in Warehouse Clubs and Supercenters and 9.4% in General Merchandise Stores.

 

Bedding.  Like Upholstery, Bedding is mainly sold in Furniture and Home Furnishing Stores, which include Specialty Bedding Stores, with 78.2% of sales, followed by Electronic Shopping at 11.5% and Department Stores at 5.8%.

 

Source: Figures reflect data from the U.S. Census of Retail Trade issued every 5 years – 2002, 2007, and 2012.  Figures for 2014 have been estimated by Impact Consulting Services’ furniture industry model.

 

Series Factoid #2: Distribution Channels: Percent of Total Years 2002, 2007, 2014


 

This is the second factoid in a series detailing the Furniture Industry’s Distribution Channels.  Factoid #2 explores the changes of the percent of total distribution by each channel during years 2002, 2007, and 2014.

 

Furniture and Home Furnishing Stores: Still the primary source of Furniture sales, this traditional distribution channel has decreased it’s percent of total by a total of 8.1% from 2002 to 2014 – down to 64.5% in 2014 from 72.6% in 2002. 

 

Electronic Shopping: While Furniture and Home Furnishing Stores decrease their hold on the Furniture Industry, Electronic Shopping is steadily gaining traction as a major distribution channel.  Jumping from 2.8% in 2002 to 7.3% in 2007, Electronic Shopping finished out 2014 with 17.8% of the total distribution.

 

Warehouse Clubs and Supercenters: This channel increased it’s share of total distribution slightly from 2002 to 2014 – up from 3.6% to 4.0%. 

 

General Merchandise Stores: After slightly increasing by 0.3% from 2002 to 2007, General Merchandise Stores grew by 1.1%  in 2014 – accounting for 3.4% of total distribution.

 

Discount Department Stores:  Dropping it’s percent of total by (-1.5)% from 2002 to 2007, this channel rebounded slightly with an increase of 0.2% in 2014 – decreasing 3.8% to 2.5% over the 12 year span. 

 

Home Center and Other Building Materials:  This channel decreased from 3.1% of total distribution in 2002 to 2.3% in 2007 and a minimal rise to 2.4% in 2014.

 

Department Stores:  Decreasing by (-0.7)% from 2002 to 2007 and (-0.6)% from 2007 to 2014, Department stores was 1.8% of distribution in 2014. 

 

All Other Retailers:  In 2014, the remaining retailers dropped to 3.7% of distribution, after a decline from 8.9% in 2002 to 7.9% in 2007.

 

Source: Figures reflect data from the U.S. Census of Retail Trade issued every 5 years – 2002, 2007, and 2012.  Figures for 2014 have been estimated by Impact Consulting Services’ furniture industry model. 

Distribution Channels: Furniture Retail Sales Years 2002, 2007, and 2014


 

Where is Furniture being sold and who sells what type of product?  This is the first factoid in a series detailing the Furniture Industry’s Distribution Channels.  Factoid #1 shows Furniture Retail Sales by Distribution Channel in selected years – 2002, 2007, and 2014.

 

Furniture and Home Furnishing Stores are at the heart of Furniture Distribution – accounting for over 2/3 of the industry.  This channel includes traditional furniture stores along with specialty furniture retailers, mattress stores, and other retail outlets where furniture is the primary source of sales.  Of course many different business models drive this category, including manufacturing and retail verticals, national and regional and national chains, and Mom and Pop dealers. This main channel reflects the ups and downs of the economy from 2002 to 2014.  From 2002 to 2007, Furniture and Home Furnishing Stores rose 13.6% in sales before falling (-10.6)% - an overall increase of 1.5% in 2014.

 

The most noteworthy changes occur in Electronic Shopping as the online distribution of Furniture has made great strides despite the Recession years.  Over the course of twelve years, Electronic Shopping has jumped 627.2%  - increasing 201.3% the first 5 years and 141.3% the latter 7 years.  Furniture Retail Sales grew from 1.8 Billion in 2002 to 13.0 Billion in 2014.

 

Both General Merchandise Stores and Warehouse Club and Supercenters grew in distribution from 2002 to 2014.  General Merchandise Stores increased by 27.3% from 2002 to 2007 and 47.5% from 2007 to 2014 – with at total growth of 87.8%.  While Warehouse Club and Supercenters had just a slight increase of 2.9% from 2007 to 2014, they had an overall jump of 24.3% over 12 years.

 

All other distribution channels showed substantial declines over the 12 year span.  With the exception of Discount Department Stores showing growth of 8.8% from 2007 to 2014 after a drop in the first five years,  the remaining channels decreased both time increments. 

 

Source: Figures reflect data from the U.S. Census of Retail Trade issued every 5 years – 2002, 2007, and 2012.  Figures for 2014 have been estimated by Impact Consulting Services” furniture industry model. 

Industry Sales by Quarter 2008 Q1 to 2015 Q1 Bedding Industry


 

In the first quarter of 2015, Bedding Sales increased 16.3% from 2014Q4 and 10.2% compared to sales in the same quarter last year.  Year-to-date sales at $3.5 billion are up from $3.2 billion over the 2014Q1.

 

The chart above shows quarter-to-quarter Bedding industry performance from 2011Q3 through the first quarter of 2015.   For the last eight quarters bedding has shown steady and increasing improvement over the same quarter of the previous year.  In the first quarter of this year sales totaled $3.5 billion, up 10.2% over Q1 of 2014.

 

Note: Previously issued 2014 Q4 estimates have been revised.

 

 

 

 

 


Industry Sales by Quarter 2008 Q1 to 2015 Q1 Furniture & Bedding

The Industry continued its steady growth in the first quarter of this year.  A 7.7% increase over the same quarter last year resulted in Furniture and Bedding sales totaling $22.7 billion.  Compared to the previous 4th quarter of 2014, sales were up slightly 0.75%.

 

Furniture (excluding Bedding) increased 7.2% over 2014 Q4, but was down 1.68%  over quarter 4 of last year.  After a typical 4th quarter slump last year, Bedding grew 10.2% compared to Q1 of last year and 16.3% over Q4 of 2014.

 

The chart above shows quarter to quarter industry performance from 2012 Q1 through the first quarter of 2015.

 

First quarter combined Furniture and Bedding industry sales of $22.7 billion were a 7.7% improvement over $21.1 billion from the same quarter in 2014. Compared to last quarter (2014 Q4) sales improved 0.75%/

 

Furniture (excluding Bedding) increased 7.2% with sales of $19.2 Billion in 2015 Q1 – up from $17.9 Billion in 2014 Q1.

 

Bedding had an impressive quarter with sales of $3.48 billion, up 10.2% over first quarter sales last year of $3.15 billion.

 

Series Factoid #3: The 2020 Consumer: Estimated Furniture Industry Sales Based Solely on Household Formations and Current Consumer Spending Years 2015, 2020 and 2025

This is a third in a series detailing how the projected shifts in population will determine which age segments will have the highest numbers and who the Furniture industry should look to as it’s target customers.

The growth of the 25 to 44 year olds coupled with the decline of ages 45 to 54 (as shown in Factoids #1 and #2 of this series) should still result in moderate growth as the Millennials start to spend. This is based solely on demographic trends --projected population growth (Department of Commerce, Census Bureau), current headship rates, and most recent average consumer expenditures by age group (Consumer Expenditure Survey).

Demographic trends alone should grow the industry by $7.7 billion dollars over the next 10 years to $97 billion. Because of their sheer numbers, in ten years the over 65 Baby Boomers will still spend $17.8 billion and have the highest volume increase of $3.1 billion. The 35 to 44 year olds, although smaller in number, will spend $21.7 billion with the highest average per household and grow by more than $2.5 billion in industry sales.

Couple these demographically driven increases with the Department of Labor’s projected increases in consumer spending over the next ten years and the outlook significantly improves. In addition, increased housing demand by the Millennials will also fuel the furniture industry.

*Estimates are based on current demographically driven trends projected by the Census Bureau and do not reflect any changes in economic conditions. The Bureau of Labor Statistics is projecting increases in consumer spending over the next ten years that would significantly improve this outlook.

Series Factoid #2: The 2020 Consumer: Projected Population by Age Groups 2015,2020,2025


 

This is a second in a series detailing how the projected shifts in population will determine which age segments will have the highest numbers and who the Furniture industry should look to as it’s target customers.

 

Ages 15 to 24:  Many of the Millennials will be aging out of the youngest of the future furniture purchasers, the 15 to 24 year old group, over the next five years.  The group is expected to decline (-1.7)% by 2020 and remain relatively flat with 0.4% growth from 2020 to 2025.

 

Ages 25 to 34: As the Millennials begin to age into the young adult group ages 25 to 34, a projected rise of 6.3% in population by 2020 should cause the Furniture industry to take notice. 

 

Ages 35 to 44:  The largest spenders on home furnishings, the 35 to 44 year olds, are expected to have the highest growth among the key home furnishings purchasers– increasing 5.2% by 2020 with an additional jump of 7.7% by 2025. Combined 25 to 44 year olds are set to increase in number from 84.7 million to 93.4 million over the next decade – a gain of 10.4%.  These younger adults will become the heart of the furniture industry.

 

Ages 45 to 54:   These prime earners are projected to decrease (-5.3)% in the next five years and will ultimately shift from 43.1 million in 2015 to 40.7 million in 2025.  The decline of these high earners will have the most negative impact on upper and premium price points.

 

Ages 55 to 64:  While expected to jump 5.3% by 2020, Baby Boomers will age out of this group the following 5 years - resulting in a slight overall growth of 1.6% from 2015 to 2025. 

 

Ages 65 and Over:  As Baby Boomers begin to age, this age segment is expected to skyrocket 18% by 2020 and have a total increase of 37.8% for the entire decade.

 

*Source: U.S. Census Bureau, Projections of the Population of the U.S. 


Series Factoid #1: The 2020 Consumer: Projected Population by Age Group Percent Growth 2015 to 2025


 

This is a first in a series detailing how the projected shifts in population will determine the Furniture industry’s target customers in the next 5 to 10 years. 

 

The children of the Baby Boomers,  the Millennials, are entering their 30s and will slowly feed the furniture industry for the next 20 years.  Not surprisingly, Baby Boomers turning 65 in the next 10 years will facilitate a dramatic increase in the 65 and over age group .  Their growth will skyrocket 37.8% - increasing at a rate of 3.3% a year from 2015 to 2025.

 

Combined, the 25 to 44 year olds are projected to increase 10.4% over the next decade.  Note that consumers ages 35 to 44 spend the most on home furnishings per household of any group.

 

Meanwhile, the tail end of the Baby Boomers , the 45 to 54 year olds, who have been the highest populated group over the last ten years, will now house much of the Baby Bust generation and are estimated to drop (-5.7)% by 2025.  These high earning consumers have historically been key purchasers of upper and premium furniture.  While projections for Ages 55 to 64 show a growth of 5.2% by 2020, these final Baby Boom numbers are expected to drop (-3)% by 2025. 

 

The youngest segment, ages 15 to 24, is due to remain flat over the next five years and decline (-1.2)% by 2020.

 *Source : U.S. Census Bureau, Projections of the Population of the U.S.

 

Series Factoid #4: The Future of the Youth Consumer: Women of Childbearing Age Projected Population in Selected Years 2015, 2020, 2025


 

This is the fourth and last factoid in a series detailing demographic shifts over the next five and ten years that will impact the Youth Furniture industry.

 

A major factor in determining the future of the Youth Furniture market is the projected population of women of childbearing age.  Are they increasing in number and are they having enough babies to support healthy growth in Youth Furniture sales?

 

While the crude birth rate (number of births per 1,000 women) continues to decline and is expected to drop (-3.2)% from 2015 to 2025, the population of women of childbearing age (18 to 44) is estimated to increase by 6.5% during the next decade – accounting for increases in projected births. 

 

The number of women ages 35 to 44 is projected to increase by 12% in the next 10 years as the children of the Baby Boomers finally reach their prime furniture purchasing  years.  According to the National Center of Health Statistics, the number of first births to women 35 and over is nine times higher than in 1970.  These women are delaying childbirth or having additional births well into their 30s.

 

Women ages 25 to 34 are also expected to increase in population – growing 7% over the next 10 years, while ages 18 to 24 is projected to decrease by (-1.2)% as the children of baby boomers begin to leave that age group. 

 

Sources:  National Center for Health Statistics and U.S. Census Bureau, Projections of the Population of the U.S.


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