3 Key Growth Drivers In The Furniture and Homeware Industry
While the furniture and homeware industry faces a wide range of challenges, things are actually looking up. Lockdown necessitated the closure of manufacturing plants, businesses had to dip into cash flow reserves and civil unrest in the country really left the entire industry shaken. But in spite of these setbacks, there are three key areas that are allowing industry players to look ahead and grow their furniture and homeware businesses, regardless of tough times.
1. Home office hybrid models create a new demand for the industry
Lockdown changed how companies did business, forcing staff to work from home but also challenging an age-old office-bound culture. Now, many companies are allowing staff to either work from home or they are encouraging a hybrid of both at-home and in-office setups. The result of this is that people are kitting out their home office spaces and require a different kind of furniture product that is suitable for this new hybrid setting. This has led to an increased demand for office furniture in residential spaces as people are customizing their locations in order to work more comfortably from home.
2. Future investment
While the country has a shortage of design expertise and insufficient research and development in this area, initiatives like SAFI (South African Furniture Initiative) which is backed by the Fibre Processing and Manufacture SETA has shown that there is a demand and opportunity for skills planning. They have found that the artisan sector, like upholsterers and carpenters, has not kept up with the times and while the rest of the world has moved into computer-aided design, South African artisanal manufacturers have remained relatively stagnant. This skills deficit opens up the opportunity for learning and development and a gap for business and training facilities to upskill and build technical abilities. This would result in uniquely South African product lines and will inevitably create employment opportunities in the sector.
3. A grand plan for the furniture industry
In 2021 the Department of Trade, Industry and Competition created a Masterplan for the future of the SA furniture industry. Their aim was to revitalise the industry by identifying many areas of improvement. The initiative tabled eight pillars that hold the potential to transform the industry, together with an action plan. While the government has yet to deliver, there are important gaps that private industry can fill within their own businesses. Including supporting the demands for locally made furniture, partnering with retailers, designers and manufacturers and addressing the shortage of raw materials. These all hold strategic opportunities for growth in the furniture and homeware industry.
The bottom line
The local furniture manufacturing sector is made up of large players. But a vast majority of the companies are also small and medium businesses that are in need of opportunities to grow their businesses. As is the case with so many businesses post-pandemic, the companies that make it in this sector will be the ones that think differently, embrace problem-solving, harness new thinking and find lucrative gaps to grow.
To furnish your next growth strategy and fund your furniture or homeware store in the next 48 hours, contact Merchant Capital today.