Furniture Market – 70% Domestic
Some of the most prominent players in the premium furniture industry are now focusing on Noida-Greater Noida, Faridabad and Gurgaon for both home and office furniture. Names like Ebony Gautier, Evok, Durian, Godrej Interio, Natuzzi and Stanley feature in this coveted list of premium brands. The target group for these brands is the high net worth individuals (HNIs) who travel around the world and have been exposed to better lifestyle. International consulting firm Technopak Advisors estimates the furniture market in India is likely to witness a whopping CAGR of about 30 percent over the next three years.
The organized segment, which comprises mainly imports and a few Indian manufacturers, are mostly into the office furniture segment accounting for about 15-20 percent of the total pie.
A major chunk of the organized imported segment (80 percent) comprises home furniture. The organized sector has shown a growth of about 13-15 percent last year and is expected to grow even more.
SWOT FOR FURNITURE: -
* Increasing demand in modern, clean, minimalist designs * Highly educated, skilled, young, capable & dynamic human resources * Established branding, tradition
* Diversity vs. Ideas (Innovation, Integration)
* Big democracy= big market & free media
* Inefficient stock control
* Lack of trust in external organizations
* Fear of sharing knowledge & taking risks
* Lack of effective & execution framework
* Industry has slow of innovation & change
* Lack of quality awareness
* Big potential market in Design sector & emerging new market segment in Services * Lower labor costs in outsourcing
* Research & Development capability
* More efficient production method
* Need modernization of infrastructure
* Very little competition in modern furniture design
* Large fluctuations in stock control (new production method) * Rising cost of imported goods
* Pioneering uncertainties
* Clashes in Diversity vs. Imbalance
* Fast change Internet (IT), new inventions (Technology, Innovations)
As of 2006, the Indian furniture market is estimated to be worth US$ 7,922 million and is growing at 30% compound annual growth rate in the organized sector, which represents only 15% of the whole country. Of this, wooden furniture accounts for US$ 1,358 million. About 11 per cent (US$ 152 million) of this (wooden furniture) is imported and imports are growing at 50 to 60 per cent every year. India was the largest furniture importer in the world in 2004-05, with a 17 per cent share in the furniture imports worldwide. A total of 10, 476 importers shipped furniture to India during this period, mainly from Italy, Germany, Spain, China, Korea, Malaysia, Indonesia, Philippines and Japan. Target Market: -
Home furniture in India is available in a wide range, to cater to different customer needs. A typical middle class urban Indian home has five rooms (including kitchen and bathroom). About 25 per cent of the urban population live in homes with five rooms or more, while 45 per cent live in houses with three rooms or less. About 16 per cent is estimated to live in single-room homes. The rich and upper middle class is typically very attentive to design and quality, so price is rarely a determining factor. In general, European style furniture is only found in homes of the urban upper class. Demand for furniture of international standards is limited to the larger cities. It is also estimated that the wealthier classes do not change furniture very frequently; the average life of a piece of furniture is about 20 years and some craftsmen’s pieces are used for as long as 50-70 years....