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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

The Changing Profile of Renter vs. Owner Households

For many in pursuit of homeownership and those already there, the Great Recession forced the American tradition of owning a home aside and renting became the viable alternative. Now safely out of the recession, many renters are choosing to stay put or better yet, keep the freedom to move. This is the first factoid in a series of five factoids, using data from the U.S. Census Bureau’s 2017 American Community Survey, to explore the changing profiles of owners and renters.

Renter-occupied housing is at its highest level in almost 50 years (36.2 percent of households) and up 9.3 percent 2010 to 2017. This compares to owner-occupied housing only increasing by 2.4 percent.

According to an October 2018 survey from Freddie Mac, 78 percent of renters believe renting is more affordable than owning. Across all generations, reasons for renting include housing shortages, rising home prices, remaining fear after the market crash, ability to pick up and move and a desire to live closer to work.

Comparing the change in number of owner-occupied units to renter-occupied units over seven years, renter households went from 34.6 percent of total housing units to 36.1 percent - increasing 3.7 million units from 39.7 million to 43.4 million households.

Industry Sales by Quarter 2012 Q1 to 2019 Q1 Furniture & Bedding

Following high growth in the third and fourth quarters of last year, the fourth quarter softened and continued to soften into the first quarter of this year. Combined Furniture and Bedding sales grew only 1.8 percent in the first quarter versus the same quarter in 2018. Compared to the previous quarter, 2018 Q4, first quarter sales were down 3.2 percent totaling $25.92 billion.

Furniture (excluding Bedding) in the first quarter increased 1.86 percent versus the same quarter 1 in 2018 totaling $21.88 billion. Compared to the fourth quarter of 2018, Furniture sales fell 6 percent.

Although Furniture sales typically dip in the first quarter compared to the fourth quarter of the previous year, Bedding sales tend to increase. After a poor fourth quarter last year, Bedding sales were up 15.6 percent over 2018 Q4, totaling $4.05 billion. Compared to the same quarter last year, 2019 Q1 sales increased only 1.5 percent.

Following high growth in the third and fourth quarters of last year, the fourth quarter softened and continued to soften into the first quarter of this year. Combined Furniture and Bedding sales grew only 1.8 percent in the first quarter versus the same quarter in 2018. Compared to the previous quarter, 2018 Q4, first quarter sales were down 3.2 percent totaling $25.92 billion.

Furniture (excluding Bedding) in the first quarter increased 1.86 percent versus the same quarter 1 in 2018 totaling $21.88 billion. Compared to the fourth quarter of 2018, Furniture sales fell 6 percent.

Although Furniture sales typically dip in the first quarter compared to the fourth quarter of the previous year, Bedding sales tend to increase. After a poor fourth quarter last year, Bedding sales were up 15.6 percent over 2018 Q4, totaling $4.05 billion. Compared to the same quarter last year, 2019 Q1 sales increased only 1.5 percent.

For the second straight quarter, the first quarter in 2019 slowed compared to the same quarter of last year. Furniture and Bedding sales of $25.92 billion reflect an increase of 1.8 percent over 2018 Q1. Compared to the fourth quarter of last year sales are down 3.2 percent.

Furniture (excluding Bedding) increased 1.86 percent in 2019 Q1 versus the same first quarter of 2018 with sales of $21.88 billion. This figure is down 6 percent over last quarter, 2018 Q4.

Coming off a tough 2018, where sales for the year increased less than one percent (.08 percent), Bedding rebounded slightly in 2019 Q1, up 1.5 percent to $4.05 billion. Compared to a poor fourth quarter of last year, sales were up 15.6 percent in the first quarter of this year.

Millennials Gain Share of Consumer Spending Age and Size of Household by Generation

As Baby Boomers continue to age out of prime furniture buying years, Generation X households have held strong in their power as key contributors to consumer spending – despite a much smaller population size. A more affluent Generation X population paired with the sheer size of Millennials, now fully in adulthood, points to a bright future for the furniture and home furnishings industry. In 2017, Millennials accounted for 71.9 million people and are expected to surpass Baby Boomers size of 73.5 million next year.

This is the final factoid in a series of four factoids, using data from the U.S. Bureau of Labor Statistics’ 2017 Consumer Expenditure Survey to show the shift over the last four years in consumer spending among the five adult generations as Millennials continue to gain a greater share.

With the highest income and an average age of 44.3, Gen Xers are the industry’s prime consumers. Now an average age of 60.2, many Baby Boomers have retired or are preparing to retire, while the average Millennial is yet to reach 30 with many earning years ahead. In fact, Millennials have now surpassed Gen Xers in the number of individuals in the U.S. workforce.

Generation X represents the bulk of families with children. In 2017, they had an average of 3.1 people per household, slightly down from the 3.2 of the three previous years but still well above the 2.5 for all consumer units. Millennials are starting to have children at a higher pace – bumping up the average size of a Millennial household to 2.6. Baby Boomers still have an average of 2.2 persons per household, possibly reflecting leftover Millennials still at home for younger Boomers.

Millennials Gain Share of Consumer Spending Income by Generation

This is the third factoid in a series of four factoids, using data from the U.S. Bureau of Labor Statistics’ 2017 Consumer Expenditure Survey to show the shift over the last four years in consumer spending among the five adult generations as Millennials continue to gain a greater share.

The Consumer Expenditure Survey estimates mean/average consumer unit income per generation, as opposed to median income. Gen Xers have experienced the highest average income (before taxes) over the last four years – topping at $95,168 per household in 2016, the highest mean household income of any generation in history. Even with a slight dip from 2016 to $95,032 in 2017, average income for Generation X has increased 12.8 percent since 2014. Although Millennial households earned, on average, 54.2 percent less than Generation X and 28.1 percent less than Baby Boomers in 2017, average income among Millennials has increased 21.1 percent over the last four years and will continue to increase as younger Millennials enter the workforce and form households.

Although the Baby Boomer and Generation X households still earn considerably more than Millennials, the percent of total U.S. income is shifting each year in a positive direction for Millennials compared to older generations. Since 2015, Generation X has decreased its share of total income alongside Baby Boomers, while Millennials continue to grow. Income from Millennials now account for 21 percent of total U.S. income compared to 16.2 percent in 2014.

Source: Bureau of Labor Statistics, Consumer Expenditure Survey 2017
*Includes income from all sources  - wages, government subsidies, social security, pensions etc.

Millennials Gain Share of Consumer Spending: Part 2

This is the second factoid in a series of four factoids, using data from the U.S. Bureau of Labor Statistics’ 2017 Consumer Expenditure Survey to show the shift over the last four years in consumer spending among the five adult generations as Millennials continue to gain a greater share.

Millennials have entered into adulthood and continued to form households – growing their share of consumer units. At 25.1 percent in 2017, Millennials percent of consumer units has jumped 2.2 points in just one year, while the older generations (including Generation X) decrease.

In 2017, U.S. households spent $7.8 trillion in the U.S. economy with Baby Boomers controlling 36.1 percent of all total consumer expenditures, followed by Generation X at 32.3 percent. While Millennials still control only 21.4 percent due to lower average household incomes and still smaller numbers, this generation increased its share of total spending by 3.9 percentage points 2014 to 2017 – up from 17.5 percent in 2014. On the flip side, both Generation X and Baby Boomers have decreased share as numbers rise for Millennials.

For furniture and bedding expenditures, Millennials continue to step up to spend more of their income on home furnishings than any other generation. While they still control only 24.6 percent of industry sales, the share has increased each year from 20.1 percent in 2014. Gen Xers have slipped in control down to 32.3 percent, most likely due to the smaller size of the generation, but remain close to Baby Boomers’ 34.3 percent. As Baby Boomers age out of the furniture industry, the influence of Gen Xers and Millennials will continue to grow in the years ahead. 

Source: Bureau of Labor Statistics, Consumer Expenditure Survey 2017

Millennials Gain Share of Consumer Spending

As Baby Boomers continue to age out of prime furniture buying years, Generation X households have held strong in their power as key contributors to consumer spending – despite a much smaller population size. A more affluent Generation X population paired with the sheer size of Millennials, now fully in adulthood, points to a bright future for the furniture and home furnishings industry. In 2017, Millennials accounted for 71.9 million people and are expected to surpass Baby Boomers size of 73.5 million next year.

This is the first factoid in a series of four factoids, using data from the U.S. Bureau of Labor Statistics’ 2017 Consumer Expenditure Survey to show the shift over the last four years in consumer spending among the five adult generations as Millennials continue to gain a greater share.

In 2017, Baby Boomers still had the highest number of households representing 34.4 percent of consumer units, compared to 26.8 percent for Generation X, and 25.1 percent for Millennials. Although Millennials are inching closer to Generation X in consumer units, the percent of all consumer spending is still over 10 percentage points higher for Gen Xers and almost 15 points higher for Baby Boomers. After years of Baby Boomers controlling the majority of furniture and bedding spending, the market has now spread to Generation X and Millennials, who combined account for 56.9 percent.

Source: Bureau of Labor Statistics, Consumer Expenditure Survey 2017, Pew Research
(1)Demographers are still debating the last birth year of Millennials, Pew Research has recently set the year at 1996. The Census Bureau has not yet gone on record for the Millennial end year.
(2) Post Millennials will likely be split into two generations at some point

The Changing Retail Landscape: Average Sales Per Stores

The retail landscape has evolved over the last ten years and continues to shift as more brick and mortar stores shutter their doors amid a growing e-commerce industry.

This is the final factoid in a series of five factoids detailing the dramatic shifts in the furniture industry’s distribution channels, taking place in both sales and in-store counts. The U.S. became over-stored in many channels during the 1990’s and early 2000’s as developers kept building shopping centers and companies continued opening retail outlets.

The Great Recession was the initial economic event to impact the retail landscape, especially for furniture and home furnishings stores as the housing and mortgage crisis escalated. Then with the influx of internet companies like Amazon and Wayfair, consumers altered spending habits and priorities.

During the recovery period from 2012 forward, all furniture and home furnishings distribution channels grew in sales, despite store closings, with the exception of electronics and appliance stores and department stores.

The net effect, especially for furniture, is that even though industry sales slowed and stores shuttered, the ones left standing had higher sales and continued to increase their sales per store. The average annual sales per store for furniture stores climbed steadily from $1.9 million in 2009 to $2.9 million in 2018 YTD – jumping 52.6 percent. Home centers have also benefitted from the net effect, increasing their sales per store by 73.7 percent during the same time period, mostly likely as smaller stores have closed.

Source: U.S. Census Bureau, Survey of Retail Trade

The Changing Retail Landscape Retail Sales Select Furniture and Home Furnishings Retailers

The retail landscape has evolved over the last ten years and continues to shift as more brick and mortar stores shutter their doors amid a growing e-commerce industry.

This is the fourth factoid in a series of five factoids detailing the dramatic shifts in the furniture industry’s distribution channels, taking place in both sales and in-store counts. The U.S. became over-stored in many channels during the 1990’s and early 2000’s as developers kept building shopping centers and companies continued opening retail outlets.

During the recovery period from 2012 forward, all furniture and home furnishings distribution channels grew in sales, despite store closings, with the exception of electronics and appliance stores and department stores.

Retail sales from electronic shopping and mail-order houses catapulted 131.3 percent from the peak of the recession in 2009 to 2017, but furniture stores and home furnishings stores experienced a healthy growth in retail sales, increasing by 23 percent and 21 percent from 2012 to 2017.

Both furniture stores and home furnishings stores’ sales have grown a yearly average of 4 percent in the past five years. Warehouse clubs and superstores have slowed momentum of sales in the last five years, but are still growing an average of 2.6 percent each year.

Source: U.S. Census Bureau, Survey of Retail Trade
*2007 to 2012 contains five years of data surrounding the Great Recession, 2012 to 2017 reflect recovery and economic growth years

Growth and Decline of Furniture Stores Annual Growth in Establishments

The retail landscape has evolved over the last ten years and continues to shift as more brick and mortar stores shutter their doors amid a growing e-commerce industry.

This is the third factoid in a series of five factoids detailing the dramatic shifts in the furniture industry’s distribution channels, taking place in both sales and in-store counts. The U.S. became over-stored in many channels during the 1990’s and early 2000’s as developers kept building shopping centers and companies continued opening retail outlets.

This factoid tracks the percent of stores closed from two historical perspectives – (1) 2007 to 2012 during the recession and subsequent slow recovery years, and (2) 2012 to 2018 during economic recovery and high growth. During the recession and the immediate recovery years, furniture stores and home furnishings stores shuttered more locations as a percent of total than any other in the key retail furniture groups, closing stores an annual rate of 3.8 percent over those five years. Meanwhile home furnishings stores closed 3.5 percent of locations each year 2007 to 2012. But these two primary channels took their hits early due to the housing and mortgage crises as did home centers. During the last five years furniture and home furnishings stores lost less than 1 percent of its outlets annually. Meanwhile home centers closed 2.2 percent of stores annually in the five-year recessionary/recovery period and continued to lose 1.2 percent annually 2012 to 2018Q1.

Other retail channels continued to grow during the early recession and post period or had minimal store closing, but have closed stores in recent years. These include department stores and electronics and appliances retailers. The only retailers to continuing opening stores were warehouse clubs and superstores, general merchandise stores, and electronic shopping and mail-order houses (non store retailers).

Source: U.S. Bureau of Labor Statistics, Quarterly Census of Employment and Wages
*2007 to 2012 contains five years of data surrounding the Great Recession; 2012 to 2018 Q1 reflect recovery and economic growth years.

The Changing Retail Landscape: Growth and Decline of Furniture Stores


The retail landscape has evolved over the last ten years and continues to shift as more brick and mortar stores shutter their doors amid a growing e-commerce industry.

This is the second factoid in a series of five factoids detailing the dramatic shifts in the furniture industry’s distribution channels, taking place in both sales and in-store counts. The U.S. became over-stored in many channels during the 1990’s and early 2000’s as developers kept building shopping centers and companies continued opening retail outlets.

The number of furniture stores peaked in 2007 at 27,630, according to the U.S. Bureau of Labor Statistics. Since that time brick and mortar furniture stores fell to 22,052 store fronts this year. This 20.2 percent total decline or annual CAGR of 2 percent loss represents the largest decrease of all the key channels 2007 to 2018 Q1. The announced closing of 700 Mattress Firm stores will result in another 3 percent decline. Home furnishings stores did not fare much better, falling 19.4 percent in number over the 10 plus years, but showed a slight uptick in the first quarter of this year of 0.3 percent.

During the same time period 2007 to 2018 Q1 pure electronic shopping and mail order houses surged by 100.9 percent or 6.5 percent annual growth.

Warehouse stores and supercenters (i.e. Costco, Wal-Mart, and Target) peaked in number two years ago in 2016 at 6,073 locations and have gradually closed 1.1 percent of the stores over the last 15 months. Department stores (i.e. Macy’s, Bloomingdale’s, Kohl’s, TJ Maxx) as a group also showed strong signs of post-recession recovery, increasing the number of stores by 22.5 percent (2007 to 2015) before a catastrophic closing of 14.5 percent of stores in just over two years. Electronics and appliances stores, the largest distribution channel in number, along with home centers (i.e. Home Depot, Lowes’s) continued to remove stores throughout the recession and after, maintaining an average annual decline of 1 percent and 2 percent, respectively. At one time the electronics and appliances stores totaled 53,343 but now number 45,351 in 2018 Q1.

Source: U.S. Bureau of Labor Statistics, Quarterly Census of Employment and Wages

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