The global luxury furniture market is anticipated to reach $28.60 billion by 2022 at a CAGR of 3.7% in the forecast period. The key factors affecting the growth of this sector is disposable income. The growth of the luxury furniture sector is directly proportional to the adoption of e-retailing methods to reduce the operating expenses in sales & distribution and growth of real estate industry. The real estate sector has shown a significant slowdown in the 1st half of 2017.
However, the market is expected to grow with the moderate speed. Development of the real estate industry for commercial as well as the residential place would push the luxury furniture market forward. Also, the development is coupled with the change in lifestyle of the consumers, especially in urban areas due to increase in disposable income. However, the growth can be hampered by the increasing expenses for a raw material required, the design of furniture and the lack of skilled workforce.
Raw Material Insights
By raw material, the luxury furniture market is categorized into plastic, metal, wood, glass, leather, and others. Mahogany, Teak, Jackfruit, Cedar and Redwood trees are the primary sources of raw material. The increase in the cost of materials, such as wood, leather, and stones, may restrain the market growth.
Consumers are inclined toward eco-friendly furniture due to the increased environmental awareness. Also, the companies are concerned about their carbon footprints and now started to offer eco-friendly alternatives which are possible due to technology and innovative ideas of designers such as marble, stone, plastic, and metal. Moreover, these materials have high durability and low maintenance cost.
Luxury furniture is used for commercial as well as domestic purpose. The domestic sector contributes nearly two-third of the global luxury market revenue. In the domestic sector, living and bedroom dominated the rest of the segments by the returns in 2014 due to the consumers that are specific in the purchase of exact and precise kind of furniture to give an attractive and aesthetic look to their bedroom and living room.
Lighting products add to the mood and ambiance in the living & bedrooms, kitchen, bathrooms and outdoors. This has shaped an optimistic situation for lighting furniture, as an outcome, it is gaining admiration among consumers and is estimated to witness substantial growth.
Service segment contributes the largest share of the revenue in the commercial sector. Consumption of luxury furniture in the service sector is expected to grow at a higher pace to provide a better service experience to the customers. Gyms, hotels, restaurants install luxury furniture following the rise in market demand significantly. Modern, as well as Traditional designs, are receiving admiration thus driving towards the growth in this segment.
Europe dominates the global furniture market, followed by North America. Asia Pacific is expected to witness the fastest growth with a lucrative CAGR of 5.5% due to a rapid increase in per capita income and rapid growths in the real-estate industry in Asia Pacific countries such as China and India, which in turn opens up prominent opportunities for the sector during 2014-2022. Companies of manufacturing semi-finished wood furniture in Europe represents mainly the upstream group of the value chain. Revenue generated by Europe is estimated at $7329. 8 million in 2014.
China has emerged as the largest and fastest emerging furniture market in Asia Pacific, vastly driven by the increase in the living standards and disposable income.
The luxury furniture companies, mainly compete on the aspect of aesthetic values. New products and innovative design/material are the key strategy adopted by the companies. Major companies are using an e-commerce platform to reach the customers more effectively and efficiently and also increase their customer base. Besides this, many luxury furniture companies are associating up with designers to develop and launch a luxury range.
Key players: Valderamobili s.r.l, Laura Ashley Holding Plc, Giovanni Visentin s.r.l., Duresta Upholstery Ltd, Nella Vetrina, Turri S.r.l. Muebles Pico, Scavolini S.p.a., Henredon Furniture Industries Inc., Turri S.r.l.
Global Luxury Furniture Outlook, By Material (Market Revenue in USD Million, 2012 - 2022)
Global Luxury Furniture Outlook, by End-use (Market Revenue in USD Million, 2012 - 2022)
• Domestic use
• Living & Bedroom
• Commercial use
Global Luxury Furniture Regional Outlook (Revenue, USD Million, 2012 - 2022)
• North America
• Asia Pacific
Research Support Specialist, USA