The global furniture market is experiencing remarkable growth, driven by factors such as increasing disposable incomes, growth in the hospitality and housing sectors, and developments in the commercial construction industry. The market, valued at USD 677.09 billion in 2022, is expected to grow at a compound annual growth rate (CAGR) of 5.9% from 2023 to 2030.
The Impact of the COVID-19 Pandemic
However, the COVID-19 pandemic had a significant impact on consumer behavior and manufacturing trends in the furniture market. Financial constraints caused consumers to be hesitant in spending on non-essential items, including home interiors. As a result, the residential demand for furniture decreased. Thankfully, as housing projects regain momentum and consumers regain confidence, the demand for furniture is expected to rebound.
Regional Developments and Market Opportunities
The Middle East, particularly in Saudi Arabia, is witnessing a focus on the development of the real estate industry through various residential and commercial projects. The country plans to build over 555,000 residential units, approximately 275,000 hotel keys, over 4.3 million sq. meters of retail space, and over 6.1 million sq. meters of new office space by 2030. This government initiative contributes to the overall growth of the furniture market in the region.
Shaping the Future of Furniture
Furniture plays a vital role in supporting everyday functions and home decor. The availability of online platforms has made purchasing furniture more accessible than ever before. The rising demand for multi-functional and space-saving furniture products, driven by the increasing number of nuclear families and the need for portability, is accelerating industry growth.
Additionally, the residential and infrastructural development in various sectors, such as healthcare, government institutes, and hospitality, is further driving product demand. Government regulations also require furniture manufacturers to comply with specific standards, such as sealing wooden furniture in hospitals with high-quality clear lacquer to ensure durability and prevent the growth of micro-organisms.
Embracing Sustainability and Eco-Friendly Options
Consumers today have a positive outlook on environmental protection, leading companies to introduce eco-friendly furniture. These products are manufactured without toxic carcinogens and chemicals, making them a popular choice in the residential segment. For instance, Cisco Home offers furniture made with non-toxic components and FSC-certified wood, catering to the growing demand for environmentally friendly options.
Product and Material Insights
In terms of product revenue, beds dominate the furniture market, accounting for over 25% in 2022. Shifting consumer preferences towards high-end furniture products and the need for bedroom renovation projects contribute to the growth of the beds segment. The sofa & couch segment is projected to have a CAGR of 7.1% from 2023 to 2030, fueled by the increasing wave of millennials buying homes and engaging in home improvement projects.
In terms of materials, wood holds the dominant industry share of around 40% in 2022. Wood is a naturally available raw material and is used in the production of various furniture products worldwide. The plastic segment is estimated to grow at the fastest CAGR of 7.0% over the forecast period, driven by the increasing demand for low-priced designer furniture and high-performance plastic materials.
Applications and Regional Insights
The residential segment contributes to the largest revenue share of over 60% in 2022 and is expected to grow at a CAGR of 5.7% from 2023 to 2030. Increasing demand for furniture in living rooms and bedrooms, coupled with rising real estate construction projects in urban areas, drives the growth of the residential segment. On the other hand, the commercial segment, driven by the demand for office space and the growth of the hospitality sector, is expected to grow at the fastest CAGR of 6.2%.
The Asia Pacific dominates the furniture market, with a share of around 40% in 2022. The region's growth can be attributed to the increasing disposable income of the upper and middle-class population, the booming real estate industry, and government initiatives promoting infrastructure development. The Middle East & Africa is expected to witness the second-fastest CAGR of 6.2%, driven by countries like the UAE and Saudi Arabia investing in infrastructure development to attract international tourists and foster economic growth.
Key Companies and Market Share Insights
The furniture market is characterized by a few established players and new entrants. To maintain market share, many big players are diversifying their service offerings. Some key players in the market include IKEA, Ashley Furniture Industries Inc., RH (Restoration Hardware), Williams-Sonoma, Inc., La-Z-Boy Inc., Raymour & Flanigan, American Signature, Oppein Home Group Inc., Jason Furniture (HangZhou) Co., Ltd, and Steelcase Inc.
The Future Outlook
The global furniture market is projected to reach USD 1,070.87 billion by 2030, growing at a CAGR of 5.9% from 2023. With evolving consumer preferences, sustainability initiatives, and regional developments, the industry is poised for substantial growth. As the demand for furniture continues to rise, manufacturers must innovate and cater to changing market trends to stay competitive.
References:
- Grand View Research. (2023). Furniture Market Size, Share & Trends Analysis Report. Retrieved from https://www.grandviewresearch.com/industry-analysis/furniture-market