Revenue growth is expected to stabilize as consumer disposable income improves
New York, NY (PRWEB) November 20, 2014
The Furniture and Furnishings Wholesaling industry has experienced a bumpy ride over the five years to 2014. Revenue for the industry has fluctuated between growth and declines over the period as solid demand from the business segment has been offset by sluggish demand from consumers. Strong corporate profit growth and an expanding number of businesses during the past five years has created strong demand for office furniture from businesses to house new employees. However, fears of a housing bubble and dismal per capita disposable income growth have caused consumers to delay discretionary purchases, such as furniture. Nonetheless, the Furniture and Furnishings Wholesaling industry has managed to eke out annualized revenue growth over the five years to 2014. In 2014, industry revenue is expected to increase, driven by a rise in housing starts, which is expected to spur demand for new furniture.
According to IBISWorld Industry Analyst Daniel Carusotto, “manufacturers of furniture and furnishings are increasingly internalizing wholesaling operations, putting pressure on traditional wholesalers.” By controlling distribution channels, manufacturers are able to capture the wholesale profit margin and earn higher profit. Traditional retailers are finding it hard to compete on price with vertically integrated wholesalers, forcing many to exit the industry. As a result, in the five years to 2014, the number of enterprises is expected to fall
In the next five years, revenue growth is expected to stabilize. Growth will be underpinned by improving consumer disposable income and steady growth in new housing construction, which will cause consumers to buy furniture to outfit their new homes. “Moreover, with higher levels of disposable income, the industry is expected to benefit from stronger demand from retailers, which are the industry's largest market,” says Carusotto. Furthermore, as a flux of imported furniture makes its way into Canada, wholesalers will increasingly be relied upon to distribute these products to downstream users. As a result of these positive trends, IBISWorld expects revenue to increase in 2019.
For more information, visit IBISWorld’s Furniture and Furnishings Wholesaling in Canada industry report page.
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IBISWorld industry Report Key Topics
The Furniture and Furnishings Wholesaling industry wholesales a broad range of furniture for homes, such as bed frames and sofas. Wholesalers purchase goods from domestic and international manufacturers and sell them to department stores, furniture specialty shops and other respective businesses.
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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