Operators are rushing into online furniture retailing to capitalise on rapid demand growth.
Melbourne, Australia (PRWEB) September 30, 2012
The Online Household Furniture Sales industry has thrived over the past five years. Industry revenue is expected to grow at an annualised 12.1% over the five years through 2012-13, to reach $303.7 million. According to IBISWorld industry analyst Aries Nuguid, “the industry has grown rapidly from its small base as Australians have shifted to online shopping, supported by an accelerated number of internet connections”. The greater traffic through online stores has boosted industry sales. The industry attracts value-driven customers due to lower prices and convenient product comparison. Online household furniture sellers are able to offer low prices due to having little need to maintain a large floor space to display their products. Profitability has increased over the past five years as operators have benefited from economies of scale and invested in labour-saving equipment. Industry revenue is expected to grow strongly in 2012-13 as players continue to enter the industry and consumers become more accustomed to online purchases.
The Online Household Furniture Sales industry is characterised by a large number of small operators, each carving out its own share of the market. For instance, some pure-play operators focus on supplying the replica designer furniture market, while others focus on providing lower priced furniture products. The two largest players in the industry in 2012-13 are expected to be Milan Direct Pty Ltd and Harvey Norman Holdings Ltd. The industry's market share concentration is relatively low due to the recent entrance of a large number of players. For instance, many traditional retailers have only launched e-commerce websites in the past year or so. “Although these companies have established networks due to their distribution of retail outlets, their online capacity will take some time to ramp up,” says Nuguid. On the other hand, pure-play retailers are gaining larger market shares more quickly due to their instant online retail operations.
The industry will welcome even more customers onto its online stores over the next five years. The formation of more households, more entrants and customers shifting online will support the quick growth. However, profitability is expected to diminish. The entry of new players is expected to increase competition, which will encourage price drops that will cut into profit margins.
For more information, visit IBISWorld’s Online Household Furniture Sales report in Australia industry page.
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IBISWorld industry Report Key Topics
This industry includes companies that retail a range of new indoor and outdoor home furniture, such as couches, beds, tables and chairs, via the internet. Industry goods are typically purchased from domestic and international manufacturers and wholesalers, and then sold to the public online.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Basis of Competition
Barriers to Entry
Technology & Systems
Regulation & Policy
About IBISWorld Inc.
Recognised as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every Australian industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Melbourne, IBISWorld serves a range of business, professional service and government organisations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.com.au or call (03) 9655 3886.