by Peter Kusnic
June 28, 2021
The outlook for decorative laminates use in the furniture industry is closely tied to trends in the production of ready-to-assemble (RTA) furniture. This type of furniture – also called flat-pack, knock-down, and kit furniture – is sold to consumers in boxes containing unassembled components, hardware, and instructions to put together the finished product:
Global demand for furniture laminates is forecast to increase 3.0% per year to 5.4 billion square meters valued at $25.6 billion in 2024. Highlighted below are some of the key trends in the RTA furniture industry affecting market growth for furniture laminates.
The global furniture laminates market was hard hit by the COVID-19 pandemic in 2020, declining 11% in 2020 as RTA furniture production slowed or stopped in some areas, and the closure and downsizing of many offices restricted need for new and replacement furniture in office settings. Some world regions fared better than others, however. North America saw a less dramatic decline compared to other large markets, specifically Western Europe, where the pandemic exacerbated an already-weak economy:
In 2021, global furniture laminates demand is projected to rise at nearly the same rate as it fell in 2020, boosted by rebounding building construction and RTA furniture manufacturing activity as COVID-19 vaccination rates expand and the lingering effects of the pandemic on these sectors recede.
As the RTA industry in Western Europe continues to mature, producers in the region – the second largest market for furniture laminates globally and home to IKEA – are shifting production to countries with lower labor costs and more strategic proximity to emerging markets. As a result, Western Europe’s share of the global furniture laminates market will continue to slide through 2024.
As the largest producer of RTA furniture in the world, the Asia/Pacific region is the largest market for furniture laminates, and a major destination for foreign RTA furniture producers to establish or expand capacity:
Production capabilities in Eastern Europe are also substantial, and growing as more West European RTA furniture manufacturers open plants in the region to take advantage of the lower production costs. Poland, for instance, is one of the largest suppliers of RTA furniture to IKEA. Other producers of RTA furniture in the region include Romania, Russia, and Slovakia.
A major barrier to RTA furniture sales is consumer perceptions that these products look less attractive than their more expensive manufacturer-assembled counterparts. However, technology improvements are making RTA furniture a more attractive and stylish purchase option for consumers. These include:
Consumer buying will continue to shift away from furniture and department stores to outlets where RTA furniture is more likely to be sold, including home improvement centers, online retailers, and wholesale clubs.
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About the Author:
Peter Kusnic is a Content Writer with The Freedonia Group, where he researches and writes studies focused on an array of industries.
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