Businesses will increasingly choose to rent to avoid costs associated with owning furniture.
New York, NY (PRWEB) November 15, 2014
Over the five years to 2014, revenue for the Office Furniture Rental industry is expected to trend higher. Operators in this industry rent and lease office furniture, such as tables, chairs, desks and cabinets, to businesses and government institutions. The industry is driven by several macroeconomic factors, such as the number of businesses and the unemployment rate, all of which are expected to improve over the five-year period. “Growth in the number of businesses stimulates demand for office furniture, and thus industry revenue,” according to IBISWorld Industry Analyst Brandon Ruiz. Moreover, as the unemployment rate falls, demand for office furniture is anticipated to rise, as businesses require furniture for new employees. Due to these positive trends, IBISWorld expects industry revenue to grow at an annualized rate of 5.2% to $320.6 million over the five-year period, lifted by an estimated 1.1% increase in 2014. Although the industry is anticipated to rise at a relatively high rate, this is primarily due to the industry coming off a low base.
Industry profit margins are expected to increase over the five years to 2014, lifted by the aforementioned positive trends. “However, low interest rates are expected to inhibit profit growth,” says Ruiz. Although low interest rates encourage businesses to lease their office furniture to take advantage of lower financing costs, they inhibit profit growth as the monthly leasing payment paid by businesses is reduced. In an effort to become more competitive and bolster profit, many industry operators are expected to expand inorganically by acquiring smaller operators. Large operators are able to benefit from several cost advantages, such as increased purchasing power.
In the five years to 2019, industry revenue is anticipated to rise, bolstered by continued growth in the number of businesses. The number of businesses is expected to grow, which will increase the industry's downstream market size, and thus provide a greater pool of businesses for operators to service. In the past, businesses decided to rent or lease furniture to maintain financial flexibility, particularly during periods of economic uncertainty. However, businesses are expected to increasingly choose to rent furniture to avoid several costs associated with owning and maintaining furniture, such as transportation, storage and restoration expenses.
For more information, visit IBISWorld’s Office Furniture Rental in the US industry report page.
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IBISWorld industry Report Key Topics
This industry rents out office furniture to large and small businesses. Rental furniture includes tables, chairs, desks, cabinets and more.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalization & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
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