Furniture Manufacturing Industry Overview

Excerpt from Furniture Manufacturing Report

Companies in this industry manufacture products such as wood and metal household, office, and institutional furniture; mattresses; wood kitchen cabinets; and commercial showcases and shelving. Major companies include Furniture Brands International, Herman Miller, HNI, La-Z-Boy, Leggett & Platt, Steelcase, and Temper-Pedic (all based in the US), along with Hunter Douglas (the Netherlands), IKEA (Sweden), Natuzzi (Italy), Okamura Corporation (Japan), and Samson Holding (China).

Competitive Landscape

The volume of home furniture sold depends heavily on the level of home sales, while office furniture sales depend on the health of the US economy overall. The profitability of individual companies is closely linked to volume, since many costs are fixed. Small companies can compete effectively if they produce specialty items or high-quality workmanship that can sell for a premium price. Some segments, such as mattress manufacturing and office furniture manufacturing, are highly concentrated, but the industry as a whole is fragmented: the largest 50 companies generate about 40 percent of revenue.

Products, Operations & Technology

Major product categories include household furniture (about 60 percent of industry revenue), office furniture (about 30 percent), and institutional furniture used in schools, hospitals, and churches (about 10 percent). Within the household segment, wood kitchen cabinets account for about 35 percent of sales; upholstered furniture another 20 percent; nonupholstered furniture 20 percent; mattresses 15 percent; and blinds and shades 5 percent. Products include "case goods" (bedroom, living room, and dining room furniture); upholstered items like sofas and recliners; and other items such as occasional furniture, home entertainment centers, and grandfather clocks. Products may be factory-finished or ready-to-assemble (RTA). Within the office segment, wood and non-wood furniture accounts for 45 percent of sales; partitions, showcases, and shelving account for 30 percent; and custom architectural woodwork 25 percent. Companies tend to specialize in household or office and/or institutional furniture.