The US furniture industry is at a critical turning point. Over the past decade, the US furniture industry has faced many challenges, the biggest of which include the economic crisis, overseas operations in domestic manufacturing, and shrinking demand. The development of the furniture trend is as slow as the economists and industry insiders predict, and it is not optimistic.
The latest news from Furniture Fans, Anderson Bauman Tourtellot Vos, a US corporate transformation consulting firm, recently released a new furniture industry observation report that shows US furniture manufacturing A snapshot of the industry, including a view of current industry developments from a Middle Eastern market retailer perspective, highlights the challenges facing the industry and analyzes the likely responses to the challenges.
The report shows that the US furniture industry is at a critical turning point, and we cannot predict whether it will have the ability to respond quickly to sudden changes, changes in consumer buying preferences, shortage of skilled workers, and labor. Increasing costs, problems with technology integration, etc. will all lead to the inability of the US furniture industry to recover quickly after the economic crisis.
The report points out that the industry’s challenge is to reach effective communication with consumers and workers of different ages to meet market demands and launch different products to meet various types. Consumers fill the gaps in talent to stay competitive.
Trends are changing
The development of the US furniture industry has made significant progress in the past few years, since 2009 After 13% decline in sales, orders for new furniture in US furniture factories increased by at least 4% per year. As of 2013, orders increased by 23% from 2009 and 7% from 2008. This slow and steady growth has continued into 2014 and is expected to continue in the next few years.
Many US manufacturers are rethinking their offshore outsourcing (building overseas) Manufacturing, outsourcing) Why is the cost advantage gradually lost in the process of sourcing products globally? According to a survey conducted by the Boston Consulting Group in the first half of 2014, the weakening of the cost advantage of some foreign manufacturers is due to increased wages and backward productivity. Growth, unfavorable monetary value and rising energy costs.
Furniture manufacturers should carefully analyze cost issues with their overseas manufacturing departments. It is estimated that manufacturers may at least overestimate the cost advantage of offshoring by 30%.
Of course, in fact offshore outsourcing (outsourcing manufacturing to domestic manufacturers) is not a panacea. The production costs of many foreign manufacturers are still kept in a lower range, and the quality of their products is gradually increasing.
Transformation of Manufacturing
Like all manufacturing industries, the furniture manufacturing industry is also facing a shortage of skilled labor. The aging of the workforce has caused skilled workers to disappear, especially in the interior and tailoring industries. Fewer and young people are willing to do these jobs.
The problem is that the furniture industry is changing, but the impression it has in people’s minds has not changed. Many people still associate furniture manufacturing with layoffs as untrained manual labor, working in darkness and dust. The reality is that the furniture industry, like other manufacturing industries, introduces advanced technology into its processes, replacing traditional manual processes, using complex machines, and operating in a clean environment.
The challenge facing the furniture industry today is how to attract and retain a highly qualified workforce, especially young workers, and negative perceptions of subversive industries. The answer may be that this problem goes beyond the real environment of furniture manufacturing —— the transformation of manufacturing depends on the transformation of the overall image.
The real estate market is picking up
As the real estate market picks up, the furniture industry has also picked up. In 2014, the housing starts rate increased, and the sales of existing homes also increased. The sales of houses that were once difficult to get out of hand have now stabilized. Correspondingly, new furniture orders are much higher than last year, both in terms of orders and shipments. Many industry experts predict that the slow and steady growth of the furniture industry will continue until the end of 2014, confirming that the consumer confidence index remains high.
According to the economic forecast of ABTV Jim Smith, it is necessary to strengthen the focus on the real estate market and accelerate the pace to ensure the final improvement of the US economy. He pointed out that although the real estate market has not made much contribution to GDP in 2014, it will have a significant impact in the next three to five years, which is good news for the furniture industry.
Social change drives industry development
In the past decade, many factors have directly or indirectly affected In the furniture industry, including technological change, the rise of social media, and changes in demographics.
Demand Decisions Allocation
The Internet is changing the retail retail landscape, especially for young consumers, we need to open up new Distribution channels. Many retailers, especially daily-life retailers, have entered the fast-growing e-commerce market, allowing customers to purchase furniture directly from their websites. More and more consumers are willing to buy furniture online, and they are easily accepting this new distribution channel. E-commerce is a popular trend in the future development of the furniture industry.
Looking to the future
The furniture industry is in the process of transformation, and talent gaps are a big obstacle, and ways must be found to overcome it. Moreover, the industry must be brave enough to innovate in order to recover. It is now necessary to make bold decisions to correct the direction of the furniture industry and improve its profitability, competitiveness and market share.
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