Furniture Stores

Industry Profile Report

Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters

Industry Overview Industry Structure, How Firms Opertate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.

Call Preparation Quarterly Insight, Call Prep Questions, Industry Terms, and Weblinks.

Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.

Industry Profile Excerpts

Industry Overview

The 13,500 furniture retailers in the US sell new furniture and furniture-related goods, such as appliances, home electronics, home furnishings, and floor coverings. Major product categories include living room, dining room, and bedroom furniture; upholstered furniture; sleep equipment (mattresses, waterbeds); kitchen/dinette furniture; office furniture; and sleeper sofas, daybeds, and futons. Companies may specialize in a particular type of product (sofas, beds), style (contemporary, traditional), or price tier.

Dependence On Credit

Furniture is a large ticket purchase and many consumers depend on credit for funding.

Competition From Alternative Retailers

Furniture stores compete with a variety of alternative retailers, including department stores, retail arms of furniture manufacturers, mass merchandisers, warehouse clubs, home furnishings stores, and Internet and catalog retailers.

Industry size & Structure

The average furniture store operates out of a single location, employs 14-15 workers, and generates about $4-5 million annually.

    • The furniture store industry consists of about 13,500 companies that employ about 199,400 workers and generate about $63 billion annually.
    • Some companies are vertically-integrated - large retailers, such as Ethan Allen, may produce proprietary lines of furnishings.
    • The industry is fragmented; the top 50 firms account for 51% of industry sales.
    • Large companies include Rooms to Go, Cost Plus (World Market), and Haverty's.
                              Industry Forecast
                              Furniture Stores Industry Growth
                              Source: Vertical IQ and Inforum

                              Coronavirus Update

                              May 16, 2022 - Manufacturing Slows In China
                              • Furniture stores may have difficulty acquiring sufficient inventory due to supply chain issues that are creating more uncertainty. China’s manufacturing output decreased to a 26-month low in April as its zero-tolerance approach to the pandemic slowed factory output. The Caixin China General Manufacturing purchasing managers’ index (PMI) dropped from 48.4 in March 2022 to 46 in April. A reading below 50 suggests output is contracting rather than expanding. In April, new orders and production fell to their lowest levels since the survey began in 2004, and exports declined at the steepest rate in nearly two years. Delivery times grew at the second-fastest rate in the index’s history amid travel restrictions and raw materials shortages.
                              • Amid rising inflation, consumers that are pinched by high gasoline, food, and housing prices may postpone some high-end discretionary purchases such as furniture. In April, inflation rose 8.3% compared to year-earlier levels, near a 40-year high. Consumer prices for furniture and bedding rose 15% in April 2022 compared to the same month a year earlier.
                              • The Conference Board’s Consumer Confidence Index decreased to 107.3 in April from 107.6 in March 2022. The Present Situation Index—based on consumers’ assessment of current business and labor market conditions— fell to 152.6 from 153.8 in March. The Expectations Index—based on consumers’ short-term outlook for income, business, and labor market conditions—increased to 77.2 from 76.7. “The Present Situation Index declined but remains quite high, suggesting the economy continued to expand in early Q2. Expectations, while still weak, did not deteriorate further amid high prices, especially at the gas pump, and the war in Ukraine. Vacation intentions cooled but intentions to buy big-ticket items like automobiles and many appliances rose somewhat,” said Lynn Franco, Senior Director of Economic Indicators at The Conference Board.
                              • Retail sales for the furniture and home furnishings industry increased 0.7% in value month over month on an adjusted basis in March 2022 and were up 4.2% on an unadjusted basis compared to March 2021.
                              • Furniture stores are experiencing record shipment delays due to pandemic-related worldwide supply chain disruptions. Material shortages and pandemic safety measures have slowed production in factories. Store owners say that they have to guess at wait times, and the information from their suppliers is often inaccurate. “We like to be upfront [with customers], but we can only go by the information that we have," said Rob Rubin, co-owner of New England furniture store chain Bernie & Phyl's. "The lead times, what used to take us 30 days to get is now upwards of five or six months."
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