By Joanne Friedrick, Research Editor
Furniture and bedding sales are expected to hit nearly $ 120.4 billion this year, up 4.5% from 2020, largely driven by a rebound in retail despite the continuing pandemic. The 4.5% increase is the highest since 2012, when spending increased by the same percentage year over year.
According to calculations by Furniture Today and Easy Analytic Software Inc. (EASI), spending on furniture and bedding will increase at a rate of 20.8% over the next five years to reach $ 145 billion by 2026.
While store closures linked to the pandemic wreaked havoc in 2020, retailers entered 2021 with a large inventory and renewed enthusiasm from shoppers. However, supply chain issues that worsened throughout the year and rising inflation could impact spending and increase uncertainty in late 2021 and into 2022.
Case in point: The Conference Board’s consumer confidence index fell in November, after increasing in October, from 111.6 to 109.5. In addition, the Current Situation Index, which measures consumers’ ratings of business and labor markets, and the Expectations Index, an indicator of short-term prospects for income, business and labor market conditions. labor market, also fell in November.
“Concerns about rising prices – and, to a lesser extent, the (COVID-19) Delta variant – were the main drivers of the slight drop in confidence,” said Lynn Franco, senior director of economic indicators at the Conference. Board.
Franco noted that the number of consumers planning major purchases over the next six months has declined. And, she added, as the board “expects it to be a good holiday season for retailers and confidence levels suggest that the economic expansion will continue until the start. 2022,… confidence and spending will likely face headwinds from rising prices and a potential resurgence of COVID -19 in the coming months.
A look at retail metrics
E-commerce sales, another indicator of the health of retailing, were hit in the third quarter, falling 3.3% from the second quarter to $ 214.6 billion on a seasonally adjusted basis. Total retail sales for the third quarter also fell 1.1% from the second quarter to $ 1,648.6 billion.
However, e-commerce sales in the third quarter were 6.6% ahead of the same period last year, and seasonally adjusted retail sales were up 13.1% from the third quarter of 2020. Third-quarter online sales accounted for 13% of total sales, compared to 13.8% in the third quarter of 2020.
Meanwhile, the US Census Bureau’s 10-month total for furniture and home furnishings store sales of approximately $ 119.1 billion (including categories other than furniture and bedding) has increased 29.1% from the same period in 2020, although sales of around $ 12.2 billion in October were lower than in October. August ($ 12.5 billion) and September ($ 12.4 billion), indicating a slight downward trend.
Feel the impact
Other factors that may influence home furnishings sales in the future – the unemployment rate, wage growth, and median income – have seen a mixture of changes.
The unemployment rate for October 2021 was 4.6%, compared to 6.7% in November and December 2020. The rate has fallen almost steadily over the past year, with only slight increases in April and June. .
Wage growth, also up from 2020, has moderated in recent months, rising 9.77% in October from a peak of 15.31% in April. Meanwhile, median household income fell 2.9% between 2019 and 2020, falling to $ 67,521, according to the US Census Bureau.
Product that attracts attention
According to Furniture Today and EASI estimates for 2021, the bedding category, with revenue of $ 18.5 billion, topped stationary sofas to $ 18.4 billion for first place and recorded the largest year-over-year increase, growing 8.8%.
The two categories accounted for 15% of total spending on furniture and bedding in 2021. Stationary sofas, whose sales increased 5% from 2020, are expected to experience a higher growth rate over the next five years and may recover. the head.
Bedding, seating and outdoor furniture have benefited from a consumer focus on social distancing nesting and entertainment during the pandemic. The outdoor furniture category grew 4.8% to $ 5.23 billion in sales in 2021, placing it in the top three.
Other categories expected to experience significant growth over the next five years include knickknacks, swing / planer seesaws, home office furniture, entertainment furniture, and casual dining sets.
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