The Global Furniture market is estimated at the US $445.628 billion in the year 2019 and is anticipated to grow at an exponential rate. The key factor behind the growth of this market is the surging construction industry along with the rise in disposable income around the world. Rapid urbanization along with the rising standard of living are other factors driving the growth in this market. further booming travel and tourism sector is also expected to open several opportunities for this market.
Rapid Urbanization and Increasing Standard of Livings Is Surging the Demand for Furniture
Rapid urbanization and growth in the construction of smart cities are boosting the growth of the furniture market, particularly in the developing countries. Smart Cities are marked with superior infrastructure, resulting in the construction of residential buildings, commercial buildings, schools, and other educational institutions, hospitals, government administration, and others. It is observed construction sector brings in demand for the furniture market, as furniture is required for inhabiting those buildings. Further, several governments are supporting the formation of smart cities for greater economic growth. The government of India, for instance, has identified 99 cities that have the potential to become smart cities, and hence are working towards their conversion. This project will be initiated under the Smart City Mission of the government. Further, the Chinese government has sanctioned an investment of US $255 billion for the redevelopment project of Shantytown. As per the government data, around 6 million housing unity will be covered and redeveloped under this project. Along with the construction of smart cities, some countries are aiming for economic development with the construction of airports, metro, hotels, etc.
The Rising World Population Will Increase the Demand for Residential Accommodation, Hence Increasing the Demand for the Furniture Market
The world population is growing at a rapid pace, resulting in food and accommodation security concerns. The Population Division of the UN Department of Economic and Social Affairs states in its report that the world population was around 7.7 billion in the year 2019, and it is forecasted to increase to 9.7 billion by the end of 2050. The major contributor to this population will be India and China, with India predicted to surpass China to become the World’s most populated country, by end of the forecasted period.
Increased population will increase the demand for residential accommodation. Further, demand for commercial buildings, educational institutions, healthcare units, and others as well will increase. These factors will, in turn, boom the demand for the furniture market in the coming years. Also, rising disposable income and increased standard of living contribute to the growth of the market. the residential furniture market size is expected to grow at a significant rate, especially with construction activities undertaken by government bodies in developing nations. Hence one can conclude that the residential segment will boost the furniture market at a significant level.
Commercial Furniture Market to Show a Noteworthy Growth in the Forecasted Period
The commercial segment of the furniture market is expected to grow at a significant rate. The prime driver of this segment of the market is the rising HoReCa Industry (Hotel, Restaurants, and Cafeterias). A surge in the travel and tourism industry, due to increased travel enthusiasm and social media influence along with raised awareness regarding health benefits, has led to a surge in the HoReCa industry. This requires the construction of new hotels and restaurants for public usage. Also, the development and construction of airports and metro for better connectivity, is further driving the growth in this market.
Offline Mode of Sales Leading the Market
The furniture market consists of both, online channels and offline modes of sales. Rising internet penetration along with the growing use of the online channel for purchase is driving the growth of online sales of furniture. Moreover, with the innovation in technology and emergence of market specific websites and applications, the market is anticipated to grow at a significant rate. Urban Ladder is one such example of an operational virtual furniture market, in India. The company has 3 physical stores in Bangalore and virtually serves more than 75 cities in the country.
However, the offline distribution channel dominates the market and is expected to grow at an exponential rate. Due to consumer preference for a personal touch of a durable good, this segment is forecasted to share a significant market in the predicted time frame.
Geographically, the furniture market is divided into North America, Europe, the Middle East, and Africa, and Asia Pacific region. North America and European regions are estimated to hold a noteworthy share of the market, owing to stable growth in the construction industry. The middle eastern region, however, is predicted to grow at a significant rate owing to infrastructure and commercial development in the region. Projects such as Saudi Vision 2030, UAE Vision 2021, and UAE Vision 2023 are undertaking the construction of airports, hotels, and the health sector in order to boost their tourism and travel industry.
The Asia Pacific region is and will dominate the market owing to rapid urbanization, infrastructure development, and rising population growth resulting in higher demand for residential accommodation. Further, growing disposable income in the region along with a higher standard of living will add to market size. India and China are a major market for the industry, followed by Vietnam, Japan, South Korea, and others.
The coronavirus pandemic has a severe effect on the furniture market. to curb the spread of the virus, governments implemented nationwide lockdowns, resulting in a halt in the construction industry. A halt in construction means a halt in the furniture market, hence loss in the market. Further, loss in employments, and hence income shifted expenditure on furniture towards basic amenities by the consumer. Furthermore, a disturbing supply chain owing to shut down affected the market negatively.