Furniture Outlook India 2020 |India Home Furniture Market - PowerPoint PPT Presentation

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Furniture Outlook India 2020 |India Home Furniture Market

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The report covers aspects such as overall furniture market, organized home furniture market, segmentation of organized home furniture market by product categories, regional sales, target group, age group, city wise home furniture sales, by distribution channel and by material categories. The report also covers extensive analysis on customer preferences in India home furniture market, along with the trade scenario of furniture in India. – PowerPoint PPT presentation

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Title: Furniture Outlook India 2020 |India Home Furniture Market


1
India Furniture Market Report 2020 Ken Research
2
  • The furniture market in the country has been
    immensely driven by a substantial growth in the
    real estate, tourism and hospitality sector over
    the years. In FY2015, the furniture market in
    India clocked revenue worth INR billion which
    increased by from INR billion in FY2014.
    The furniture market has experienced a
    substantial growth in the last few years. There
    are several factors which have led to this growth
    such as surge in real estate and housing
    activity, increasing growth in the information
    technology and services sectors, growing
    affluence both in the urban and rural areas and
    higher proportion of middle class Indians
    aspiring for better lifestyle. Additionally, the
    import of furniture from countries such as China,
    Malaysia, Indonesia and Bangladesh is also being
    driven by the urban affluent households. The
    organized furniture market has been observed to
    grow from in FY2010 to in FY2015

3
  • The establishment of MNCs in metropolitan cities
    in the country has also impelled the sales of
    office furniture, thereby aiding the overall
    market growth in the last few years The Office
    segment in the furniture market has garnered
    of the market revenues as observed in FY2015
    which is relatively smaller proportion of the
    furniture market in the country. Over of the
    office furniture is covered by contract furniture
    which is customized by various organized stores
    especially in big retail chains In FY2015, hotel
    furniture accounted for a share of in the
    overall sales of furniture in the country
    garnering revenues worth INR billion. The major
    reason for its low demand is that most of the
    furniture in offices, hotels, cafes and industry
    are contract furniture and this demand is majorly
    catered by unorganized sector while a minor share
    is also catered through customized furniture from
    organized retailers.

4
  • The retail sales of home furniture products
    through organized retail outlets in India
    generated revenues of INR million in FY2015
    and represented a CAGR of during the period,
    FY2010-FY2015. Companies such as Godrej
    Interio, Home Center, Nilkamal, Durian Furniture,
    and Style Spa among others have grabbed
    significant positioning in the domestic organized
    home furniture market. In spite of the fact that
    of the furniture market belongs to the
    unorganized players, the growing western culture
    in the country coupled with increasing consumers
    preference for branded products have given a
    considerable surge to the branded furniture
    segment in the recent years. In order to cater to
    the mounting demand of branded furniture in
    India, the competition amongst the organized
    players has further intensified.

5
  • The arrival of international brands from Italy,
    Germany, Sri Lanka and other countries has
    brought a change in consumer perception and has
    resulted in the purchase of more expensive
    furniture products, which have in turn propelled
    the overall revenues of the market. However, a
    large number of Indian citizens have still opted
    to purchase customized furniture from carpenters
    at highly competitive prices. The employment of
    on-site carpenters has provided Indian customers
    with the flexibility to customize design, wood
    material and make any modifications to the
    product as necessary at their comfort. The growth
    of the organized home furniture industry has
    played a key role in the development of the
    overall furniture market in India. The future of
    this industry has been expected to witness an
    increase in number of foreign brands in the
    country.

6
  • Along with that, more number of companies in the
    organized segment will look forward to provide
    additional services such as customization, free
    home delivery and more. Moreover, with the
    substantial growth of the Indian e-commerce
    industry, many players have entered the online
    market for the sale of furniture products.
    Companies such as Pepperfry, Urban Ladder and
    Fabfurnish have revolutionized the sale of home
    furniture products in India by not only providing
    significant discounts but also through value
    added services such as free product demos,
    customizations, complete home solutions and
    others. Bedroom furniture held of the total
    revenue of home furniture market in India, as
    recorded in FY2015. Bedroom furniture has stood
    as the highest revenue-generating segment as
    furniture items placed in bedroom have been the
    utmost priority for Indian customers.

7
  • The living room furniture was the second most
    important choice as it garnered share in
    revenues for the year FY2015. This segment
    encompasses a wide range of coffee tables, sofas,
    center tables, corner tables, chairs,
    bookshelves, TV stands, ottomans, display
    cabinets, consoles and upholstered furniture like
    sofas and overstuffed chairs. Sofas have been the
    highest selling product in the living room as
    they are the primary items to be placed in the
    living room. They accounted for share of the
    living room furniture market.The dining room
    furniture also includes other items such as bar
    stools, sideboard cabinets, serving carts and
    wine storage units. This segment accounted for a
    revenue share of in the home furniture market
    in FY2015. The average selling price of a dining
    set in a branded showroom is usually in the range
    of INR 35,000 to INR 70,000.

8
  • The demand of modular kitchen has bolstered the
    total sales in the market from INR million in
    the year FY2010 to INR million in the FY2015.
    In the year FY2015, nearly 85 of this market
    was governed by the unorganized Johnson
    summarized of the market in terms of revenues
    sector, whereas big players such as Sleek and
    HR. Sale of home furniture in the western region
    of India was observed to be the highest at due
    to the high demand of solid wood. The Indian
    market for home furniture products has observed a
    varied/mixed demand from different income
    classes. The upper class of the Indian society
    has considered cost as a secondary factor and has
    laid emphasis on design and durability of the
    product.

9
  • In House Manufacturing Model The operations in
    domestic manufacturing of furniture in India can
    be divided into 2 basic forms, namely, make to
    order and bulk manufacturing. The raw
    materials can be obtained either through the
    local market or through imports from Malaysia,
    Indonesia or China. After procurement of raw
    materials from timber suppliers, the furniture
    manufacturer develops the designs and produces
    the product based on the customer requirement.
    The manufacturer though pays the cost of
    transportation of furniture but transfers it to
    the customer by including it in the final bill of
    purchase.

10
  • The requirement is routed to the manufacturer
    through exclusive, franchise or dealer stores.
    These stores retain a gross profit margin of
    and respectively. The wholesalers keep a gross
    profit margin of to cover their costs and sell
    furniture products to a wide range of dealers.
    One of the major draw backs of selling through an
    in-house manufacturing business model in the home
    furniture market is the higher cost of production
    in comparison to imports. Heightened labor
    expenses, raw material costs and operating costs
    in India have reflected higher prices of
    products in comparison to imports from countries
    such as China and Indonesia. Import Based Model
    Import of furniture products has been observed
    significantly in the Indian market. The presence
    of large number of dealers and traders has been
    largely due to the higher fees obtained through
    trading of furniture items in comparison to
    domestic manufacturing. The payment can also be
    taken in installments importers generally pay
    of the total cost at the time of order placement
    and transfer the remaining amount at the time of
    shipment.

11
  • The importer charge a margin of , who sips the
    product to the retailer or the exclusive stores
    which further charges a margin of on the
    furniture products. The major drawback of this
    business model is the high turn-around time. In
    case the required piece is not available with the
    furniture dealer/ supplier, it can take
    significant amount of time (several weeks) to
    import it from the source country. This would
    lead to loss of customer interest in the product
    and hence create loss in sales. Moreover, this
    model also possesses a higher risk of furniture
    damage during transportation as products have to
    be delivered through different means (sea and
    land) and require multiple loading and
    off-loading points.

12
  • Online Marketplace Model Market place business
    model enables the third party retailers to sell
    and advertise their products on an online
    platform. It has gained its prominence during the
    last few years majorly since the refurbishment of
    ecommerce sector in India. The online portal
    further develops sync with the merchant by means
    of an agreement on partnership, assessment and
    operation model. The product is then sent to the
    market place that acts as a storage place/
    inventory.T he B2B2C Model is useful in the case
    when merchants are located in different regions
    and come together to form an online virtual
    shopping mall. The major profit sources include
    fixed fees from merchants and price charged from
    transaction and additional services.

13
  • In order to establish a furniture manufacturing
    unit in Chakan, Pune, India, there are several
    parameters that need to be considered. Pune has
    been selected as prime location due to its
    central geographical presence and presence of a
    strong industrial base. The usage of both manual
    labor and automated machinery has been most
    widely used in the industry. For the first year,
    the annual production capacity will be near to
    60. The factory floor has been divided in a
    specific proportion in order to facilitate easier
    flow of material and smooth operation. The
    quality of wood used to produce furniture is
    considered of high grade. Human resources have
    formed a critical aspect of every organization.
    In a furniture manufacturing unit, carpenters,
    machine men, polish men, CAD operators and other
    skilled laborers form a vital aspect to process
    wood either manually or through machinery.

14
  • Childrens furniture has slowly gained its share
    in the Indian furniture market. The younger
    generation of parents has looked to provide the
    best surroundings for their children at home and
    have generated the demand of specialized
    childrens furniture items. These target groups
    not only have purchased individual furniture
    items, but have also looked to remodel their
    childs room to provide a unique look to their
    room. With an average budget of INR 0.2 to 0.25
    million, these buyers have showcased a mixed
    demand of theme based and non-theme based
    furniture. The overall childrens furniture
    market in India has been observed to grow at a
    CAGR of during FY2010-FY2015 and reached INR
    million in FY2015. This has represented of
    the overall furniture market. Beds and wardrobes
    have been the major products sold in the India
    Childrens furniture market. These two products
    were observed as the most essential products
    purchased by parents.

15
  • The mattress market of India has been dominated
    by small and unorganized players which cater to
    nearly of the overall requirement of
    mattresses in the country. The major types of
    mattresses observed in the Indian market include,
    spring, coir, foam and hybrid mattresses. The
    market has been dominated by domestic brands such
    as Kurlon, Sleepwell, Springfit and Nilkamal.
    However, the gradual influx of foreign mattress
    brands such as Tempur and King Koil has
    heightened the competition in the market. The
    revenues generated by retail sales of mattress in
    India amounted to INR million in the year
    FY2015. The popularity of spring mattresses has
    increased over the years as more companies have
    begun to provide springs which cater to varied
    requirements of customers. Coir mattresses were
    followed by spring mattresses which held a share
    of . South India has been considered as a
    production hub of coir mattresses, particularly
    rubberized coir mattresses. The customers in this
    region have been early adopters of good quality
    products and have been shifting towards spring
    mattresses.

16
  • The organized home furniture market encompasses
    numerous numbers of players and hence the market
    has been witnessed as highky fragmented. The
    market is moving more towards organised segment.
    This is marked by increasing customer preference
    for readymade, branded furniture. Therefore, the
    share of organized players in the market has been
    observed to grow but still major six players have
    commanded 8 share in the organized home
    furniture market. Style Spa has commanded
    share in the organized home furniture market,
    with revenues worth INR million in FY2015. The
    company had 115 retail stores as on March 31st
    2015.

17
  • In order to strengthen their position in the
    market, offline retailers have begun to expand to
    tier-2 and tier-3 stores and have continuously
    updated their product catalogues with new designs
    at cost-effective pricing. These retailers have
    also provided customers free demonstrations of
    re-modeling of their home space through
    consultations with in-house furniture designers/
    experts. The residential real estate market has
    witnessed balanced growth in the last couple of
    years owing to the increasing population and
    growing demand for affordable housing
    accommodation. Major metropolitan cities such as
    Delhi, Mumbai, Kolkata and others have also
    showcased growing demand for luxury housing
    complex such as villas, penthouses and apartments
    in the recent years.

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  • Source https//www.kenresearch.com/consumer-prod
    ucts-and-retail/home-and-office-furnishings/india-
    furniture-market-research-report/8520-95.html
  •  Contact Ken ResearchAnkur
    Gupta, Head Marketing CommunicationsAnkur_at_kenre
    search.com91-9015378249
  • Website www.kenresearch.com

19
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