• Upward trend in German furniture industry
• Export business developing well
• Growth and increasing sales opportunities in China
The German furniture industry has every reason to be optimistic says the home furnishings trade show imm Cologne. After the global economic and financial crisis, furniture consumption has risen again this year and currently amounts to approx. 280 bn euros (370 billion USD). The incoming orders received in many segments to date indicate an upward trend, even if the rate of increase has slowed down. As well as growth in China, exports to neighbouring European countries also continue to develop positively.
In the wake of sometimes severe setbacks, global trading in furniture showed a noticeable upturn again in 2010, accounting for a total value of 73 bn euros. This corresponds to an increase of 7 percent. Whereas the Asian countries are reporting high growth rates – not only in domestic sales but in exports as well – the domestic market in the USA continues to falter.
The reasons for this are not only the real estate crisis but the high unemployment rate and huge national debt, both of which are dampening consumer confidence. Nevertheless, with a value of approx. 17 bn euros, North America remains the biggest import market, followed by other big Western economies such as Germany, Great Britain and France. In Europe too, the recovery process in the wake of the economic crisis has differed from country to country. Whilst Germany, Poland and Sweden, for instance, have achieved above-average growth, major national economies like Spain or Great Britain have stagnated – with the
corresponding impact on consumption.
Germany continues to be the most important furniture market within Europe. In 2010, the sector generated sales of 18.5 bn euros (+2.2%). As far as the Federal Republic is concerned, 2010 was definitely a good year for furniture. And 2011 could turn out to be an even better year for the German furniture industry: in the first half of 2011, the sales of manufacturing enterprises with a workforce of at least 50 employees grew by 7.3 percent to 8.2 bn euros – a considerable increase as compared to the previous year. Even at this stage, we can thus expect growth of 5 percent for the year as a whole. This is largely due to the office furniture producers (+22.8 percent) and shop fitting manufacturers (14.9 percent). This positive tendency is apparent in virtually all furniture sectors: the developments in purely domestic furniture (+4.6 percent), storage furniture (+6.1 percent), kitchen furnishings (+5.3 percent) and the mattress industry (+4.4 percent) give every reason for confidence. Only upholstered furniture gives slight cause for concern. Statistically, this segment experienced a drop of 2.5 percent; this is however due to a negative statistical effect. From 2011, the official statistics include 16.7 percent fewer upholstered furniture enterprises than in 2010, which of course also results in lower total sales and explains the negative development. In real terms, the sales of upholstered furniture manufacturers are estimated to have increased by around 2 percent.
The development of the import and export trade also gives every reason for confidence. After a 6.3-percent rise in foreign business last year, export proceeds increased by 12.2 percent to 4.3 bn euros from January to June 2011. We are observing an upward trend almost every month: January +11.9 percent, February +15.5 percent, March +13.3 percent, April +15 percent, May +15.4 percent. Only June was slightly below the previous year’s level at -1.6 percent. It is particularly gratifying to see that some of the German furniture industry’s important export markets like France and Switzerland are showing marked growth again, with increases of 25.9 percent and 16.9 percent respectively up until June. There was also particularly high growth in Russia and China, whereby China’s growth potential is by no means exhausted: by the end of 2011, China is expected to overtake the USA as our furniture industry’s most important non-European market.
At the same time, German furniture imports grew by 8.3 percent to 4.9 bn euros between January and June 2011 – and therefore at a slower rate than furniture exports. Imports from European countries outside the EU are rising at an above-average rate (+14.6 percent). This particularly applies to imports from Turkey (+32.1 percent). Furniture imports from within the EU also increased, with marked increases in imports from Slovenia (+55.2 percent) and Rumania (+31.9 percent). Poland nevertheless remains Germany’s most important source of imports.
In global terms, however, China has meanwhile become the world’s most important furniture exporter and sells furniture with a value of over 21 bn euros. But there are also enormous sales opportunities on the country’s domestic market: thanks to rising incomes and enthusiastic consumer behaviour, China is becoming increasingly interesting for foreign furniture producers. According to China’s National Bureau of Statistics, spending on furniture rose by almost 40 percent in the second half of 2010 alone. Along with domestic manufacturers, German and Italian producers of high-quality brand-name furniture are increasingly benefiting from this development as well.
In view of this background, it comes as no surprise that all the indicators point to an excellent imm cologne again in 2012. The exhibition space has been virtually booked out for months and an even greater number of international exhibitors will be showcasing their latest products in Cologne. And because the trade landscape is becoming more international, we are expecting a further increase in the share of global visitors as well. Thanks in no small part to the imm cologne and all the other furniture and furniture suppliers fairs like Orgatec, the garden trade show, the Kind & Jugend kids’ fair and interzum, Cologne is entirely justified in calling itself the “No. 1 in furniture”.