With existing home sales for May posting their best gain since 2011, as USA Today reports, and this week’s new home sales report expected to show a modest increase, according to Business Insider, you might want to take a mid-year checkup of the real estate market’s spin-off effect on other lines of business.
I was intrigued, for example, to spot this report that says furnture sales are perking up; CBS MarketWatch says “Good sign for housing? Furniture and related sales at six-year high,” and says home furnishings hit $8.55 billion in May. (Note the tip about finding this “nugget” in the Commerce Dept.’s monthly retail sales report; it’s always a good one to mine for trends.)
Furniture might sound like kind of a ho-hum economic indicator but when you think about it, how often do consumers shell out for these big-ticket items? They’re important reflections of both the household and the community economy and worth a look. Why not check in with sellers of furntiure, appliances, flooring and other durable goods for insights into their industry — are increased sales driving any job creation, for example — and what they’re seeing in the home market. Size trends, for example — are smaller versions of dining tables, beds, cabinetry and TVs being purchased by apartment and condo dwellers, or are consumers seeking the large-scale pieces that fit better in new-construction “McMansion” size homes?
Traditional furniture showrooms have dwindled the past decade or two, replaced by sales of assemble-yourself pieces from big box discounters and specialty stores like IKEA. Are any remaining furnture sellers in your area hanging on, and if so, how? And if they’ve managed to survive the onslaught of no-frills bricks-and-mortar competitors, what can they do to compete with online sellers? This Furniture Today report says Overstock.com is report a “surge in online furniture sales.” Are local stores developing more sophisticated websites or other ways to level the playing field? What are the logistics and delivery hurdles compared to, say, an Overstock or Amazon?
In addition to economy furniture sold through the mail, what’s going on in the higher end? Talk with interior designers and others about demand for classic and even artisanal furnishings. And don’t forget the used-furniture market, from thrift shops to antique malls.
Furniture World and Furniture Today are industry publications you might find helpful; here’s the U.S. Bureau of Labor Statistics’ portal to the Furniture and Home Furnishings Stores pages; note that employment and hours are ticking up. If you scroll down to the data on establishments and click the little dinosaur icon for historical data, you’ll see that the number of establishments has plummeted from more than 60,000 pre-recession to about 49,000 now. You might want to ask a BLS analyst to run the numbers for your state.
Meanwhile, another interesting angle is that of office furniture demand. The Business and Institutional Furniture Manufacturers Association forecasts a 6.8 percent uptick this year and 11.3 percent growth in 2015. The BIFMA’s searchable member list will help you find related companies in your state. Not only can checking on local sales help you gauge expansion (or at least the willingness to spend some capital) on the part of area companies, but you might also spot some interesting trends for business features. For example, tell the worker bees in your audience about the latest in open-plan office design or stand-up workstations, for example. Here’s one design firms’ list of top office trends to get you going.
