The global luxury furniture industry size was valued at USD 36.60 billion in 2022. It is projected to reach USD 61.57 billion by 2031, growing at a CAGR of 5.90% during the forecast period (2023-2031).
Luxury furniture consists of movable items that exhibit the finest of an era's premium craftsmanship and design, often made of metal, glass, and wood. They enhance the aesthetic appeal of indoor and outdoor spaces such as homes, hotels, and offices. Increasing disposable income, globalization, and the massive urbanization of the world's population all contribute to the current success of the luxury furniture industry. Companies are concerned with reducing their carbon footprints in the luxury furniture market. Now, enterprises are providing environmentally beneficial alternatives. As technology advances, furniture designers become increasingly inventive and inventive in their designs. In addition, when looking for environmentally friendly furniture, clients want minimal toxicity to avoid the negative influence on their health.
Over the past few years, luxury furniture demand has significantly developed. The desire for luxury goods, which add value to living spaces, is being driven by the rising disposable income, which is, in turn, boosting the global market for luxury furniture. Additional driving forces for the market's expansion include consumer desire for branding and positioning, escalating demand for eco-friendly luxury furnishings, globalization effects, low operating costs, and growing infrastructure investments.
Urbanization and rising disposable incomes are increasing people's attention to aesthetics and urbane lives, further expanding the use of high-end furniture products. Consumption naturally grows as a result of households having more money available for either saving or spending as a result of an increase in disposable income. The market is expanding more rapidly because disposable income is rising in many important nations worldwide, and luxury furniture products are becoming more widely available, particularly those made in Italy and Germany.
The price of raw materials is always a problem for furniture manufacturers, even in ideal situations. Volatile raw material prices, which presented particular difficulties during 2019, are anticipated to provide new challenges shortly as the current pandemic scenario and a global trade war intensify. The cost of raw materials and other inputs is expected to increase further and experience volatility.
The erratic demand in areas like Asia, North America, and Europe is one of the causes of the instability. Closing certain manufacturing facilities in the area because of maintenance issues, accidents, and failures have also raised the cost of raw materials. These factors have consequently caused a steady tightening of the raw material supply markets, affecting raw material pricing.
Among its equivalents from Germany and the United States, Italian-made furniture is primarily regarded as the most popular, and high-end clients typically have a strong sense of identification with the style and quality of Italian furniture. In recent decades, hundreds of foreign furniture players have approached and expanded in the market due to the dearth of high-end local furniture brands in nations like China and Indonesia. Since expensive imported furniture is a niche market, good designs from these well-known interior designers are more valued.
Since people spend more time together in their living spaces, there is a strong trend toward large furniture on soft, comfortable sofas and chairs that allow for easy lounging. The mid-century aesthetic has been quite popular in luxury furniture. Yellows, light blues/turquoise, and greens are frequently employed to brighten areas as the popularity of crisp, transparent colors continues to rise.
The global luxury furniture market is segmented by product, distribution channel, and end-user.
Based on product, the global luxury furniture market is bifurcated into lighting, tables, chairs and sofas, bedrooms, cabinets, accessories, and other products.
The bedroom segment is the major contributor to the market and is estimated to exhibit a CAGR of 5.10% during the forecast period. A shift in consumer demand toward high-end furniture products due to technology improvements in the home furnishings sector primarily drives the market for luxury bedroom furniture. Additionally, the prevalence of the mini-housing boom worldwide is increasing demand for bedroom furniture. Further, transforming traditional homes into contemporary luxury residences has been facilitated by rising consumer per capita income, particularly in emerging countries, easy access to digital resources, and adopting current lifestyle patterns.
The market for luxury lighting furniture has shown steady expansion over the past several years, and this trend is expected to continue. The need for lighting furniture is anticipated to expand across various regions as a result of the expansion of the building sector. Luxury lighting is in great demand because of the growth in construction for the private, public, and commercial sectors. Additionally, it is projected that the quick transfer from traditional lighting technology to a more complex structure would accelerate the growth of the luxury lighting furniture industry internationally.
There is a need for tables constructed of high-end materials in the tables area of the luxury furniture industry worldwide. Consumers prefer wooden tables built from premium timber resources to tables made of glass, marble, etc. Like any furniture, dining tables are made from various materials, which are frequently influenced by silhouette and design. Wood, Veneer, glass, metal, parchment, and marble are some of the most commonly used materials to make opulent dining furniture.
Furniture makers have disregarded all accepted guidelines for creating chairs by merging premium wood with unique forms. The inclination of consumers for furniture that reduces stress, like sofas and chairs, is growing due to the hectic way of life. Genuine leather sofas are becoming increasingly popular in addition to fabric armchairs and sofas because of qualities like water resistance and easy maintenance. As more people turn to work-from-home strategies amid the epidemic, the market for chairs has seen a sharp rise in demand.
Based on distribution channels, the global luxury furniture market is bifurcated into home centers, flagship stores, specialty stores, online, and other distribution channels.
The specialty stores segment is the major contributor to the market and is estimated to exhibit a CAGR of 3.45% during the forecast period. Particularly in the major nations of Europe, lifestyle merchants and specialty lighting stores have represented a significant portion of the market. Offerings from small and medium furniture and lighting fixtures retailers to different furniture and furnishings can be found at lifestyle retailers and specialty lighting stores. They also offer their services to electrical wholesalers and department stores that sell lighting fixtures. Compared to manufacturer retail locations in China, specialty stores have a more comprehensive selection of product offerings. Retailers are choosing omnichannel methods, and sales of the products being purchased online are increasing.
Going green is a growing trend that goes together with luxury. Many retailers are developing eco-friendly furniture. Environmental issues, such as the issue of deforestation, are the driving force behind this trend. Although more expensive, eco-friendly furniture is in greater demand. Therefore, it makes sense for producers and businesses to offer it. The furniture market has a history of being cyclical and sensitive to the state of the economy. The recent economic slump has had a particularly severe impact on the furniture business.
In a retail chain, a flagship shop is a top location that serves as the brand's public face. In addition to generating revenue, a flagship store attracts customers to the brand. Typically, they are the most extensive and impressive stores, but flagship stores are more about creating an experience and a destination store that customers want to visit than just being the most significant and remarkable stores. Flagship stores are the most effective in capturing the premium feel of the product in the luxury furniture market. Most luxury furniture flagship stores have world-class design execution and attention to detail, mirrored in luxury furniture items. The flagship store is the visual and experimental embodiment of the brand.
Based on the end-user, the global luxury furniture market is bifurcated into residential and commercial.
The residential segment is the major contributor to the market and is estimated to exhibit a CAGR of 5.70% during the forecast period. The demand for luxury furniture and home décor in the global residential market is anticipated to be driven by the rise of luxury residential real estate and the change in lifestyles among most consumers worldwide, particularly in developing nations. Luxury residential real estate is heavily focused on the market. Defining luxury is subjective both domestically and internationally. Leading real estate firms around the world have luxury marketing divisions that are knowledgeable in international luxury markets. Rich people continue to appreciate and engage in the real estate market because they view it as both a reward for their hard work and a wise investment. Furthermore, it is anticipated that the luxury real estate market will be a seller's market globally in the coming few years.
Commercial luxury furniture includes seating furniture, storage units, overhead bins, and tables as essential furniture items that help in enhancing the aesthetics of these spaces as a whole. It is specially designed for commercial and corporate workspaces such as workstations, conference rooms, cafeterias, and lounges. High-end office furniture is the segment's primary focus. Although the market for modern and upscale furniture is expected to increase, market participants' expansion will be hampered by fluctuating raw material prices. It is anticipated that market participants will preserve their positions in the slow-growing categories while concentrating more on the growth opportunities in the fast-growing segments.
Asia-Pacific Dominates the Global Market
The global luxury furniture industry is divided into four regions: North America, Europe, Asia-Pacific, and LAMEA.
Asia-Pacific is the most significant revenue contributor and is expected to exhibit a CAGR of 7.30% during the forecast period. The interior design market in China is incredibly diverse, catering to all kinds of consumer demands. Along with people from various socioeconomic classes, this also covers workplace design initiatives in China's corporate districts. Small businesses looking to cut costs on office interior design may serve as customers and not require high-end, expensive furniture or lighting, whereas multinational corporations for whom office design is essential for meeting clients and partners may request luxury European furniture and high-end lighting. China has different interior design firms for lighting, flooring, doors, furniture, and wall paintings.
North America is expected to exhibit a CAGR of 3.70% during the forecast period. A buying frenzy ensues for all the items required to furnish and decorate a new home after the purchase of a house. The luxury landscape is progressively and fundamentally shifting towards the new luxury paradigm as a result of macro-level changes. In actuality, wealthy buyers are becoming increasingly interested in fewer, higher-quality luxury goods and valuable experiences. Luxury consumers are willing to pay a premium for the finest luxury things that not only fulfil their wants but also enhance their own and others' quality of life.
In Europe, the well-established hospitality industry and the region's strong emphasis on interior design also affect luxury furniture sales. Additionally, as centers of fashion trends, Italy and France, along with the robust economy of the continent, are anticipated to be the main drivers of the European market. The rise of the regional market is primarily driven by consumers' rising taste for a posh atmosphere, including opulent architecture and elegant acoustics in homes, restaurants, hotels, and cars. With 29 of the top 100 global luxury furniture companies and a market share of over 27% in 2017, Italy is one of the major nations in the world market for luxury furniture.
In UAE, the increase in residential building and housing activities, as well as rising consumer awareness of contemporary styles and fashions, have contributed to the nation's expansion of furniture. High-rise buildings and private homes are also being built more often in Dubai. Numerous foreign companies have been drawn to the United Arab Emirates because of the expanding demand for furniture from the country's residential, commercial, and industrial sectors. Due to rising brand awareness and client satisfaction, private specialized showrooms are also seeing an increase in customer traffic. An expansion may also aid the growth of the UAE furniture sector in the ex-pat population brought on by future oil price stability.
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