In-depth analysis: the development of software furniture market

First, the global soft furniture industry market competition

According to the statistics of the CSIL, the top five furniture manufacturers in the world are China, the United States, Poland, Germany, and Italy. Their furniture production value accounts for 44.88%, 12.64%, 4.58%, 3.75%, and 3.74% of the world's total.

International competition in upholstered furniture is complex. Because each country has its own unique cultural customs and consumer habits, ordinary software furniture manufacturers are faced with many difficulties such as cultural differences and poor understanding of consumer preferences in exploring the global market. Software furniture brand countries Sex and regional characteristics are more obvious.

However, some of the world’s leading manufacturers of soft furniture brands, such as Natuzzi in Italy, Chateaud AX, LA-Z-BOY in the United States, and PBV Holding in Germany, also started to expand into global markets with advanced design concepts, high quality products and rich sales experience. . Judging from the overall competition pattern of the global software furniture industry, the industry is less concentrated and the market competition is more adequate.

Second, China's soft furniture industry market competition

At present, China's soft furniture industry has a low degree of industrial concentration. Regional brands are numerous and small and medium-sized enterprises dominate. Small-sized enterprise products are mostly concentrated in the domestic low-end market, and product homogeneity is more serious. Large-scale enterprises with brand influence, channel advantages, and economies of scale are mainly located in high-end markets. With the improvement of people's living standards, more consumers will choose products of larger companies with more brand awareness.

At present, the domestic well-known manufacturers of upholstered furniture mainly include Gujia Furniture Co., Ltd., Hong Kong Man Wah Holdings Co., Ltd., Shenzhen Right Furniture Co., Ltd., Beijing Aiyi Ruisi Furniture Co., Ltd., and Steroland (China) Industrial Development Co., Ltd. Xilinmen Furniture Co., Ltd. etc.

Third, the global software furniture industry development

The global industrialization of soft furniture industry began in Europe in the early 20th century. In the 1990s, with the advancement of global processing and manufacturing technologies, the manufacturing capacity of the upholstered furniture industry has been greatly enhanced, and the market demand has also continuously expanded.

According to the statistics of "UPHOLSTERED FURNITURE: WORLD MARKET OUTLOOK 2014" published by The Centre for Industrial Studies (CSIL) in July 2013, global furniture consumption accounts for about 15% of the furniture industry.

Among them, China, the United States, and Germany are the world's major consumers of soft furniture. Soft furniture manufacturing industry is a labor-intensive industry. Influenced by factors such as higher labor costs in developed countries, the global soft furniture industry is continuously shifting to developing countries that have labor price advantages and sufficient raw material resources.

Fourth, China's software furniture industry development profile

The domestic modern soft furniture industry officially started in the early 1980s. The domestic soft furniture industry, based on the introduction of internationally advanced production equipment and manufacturing technology, has been comprehensively upgraded in terms of its digestion, absorption, technical process, product quality, design and R&D strength, sales scale, and economic benefits.

Since entering the 21st century, the development of China's soft furniture industry has maintained a good momentum. At present, China has become the world's largest producer and consumer of soft furniture. As China’s national economy continues to grow steadily and residents’ disposable incomes continue to increase, people’s demands for quality of life are getting higher and higher. Soft furniture is increasingly favored by domestic consumers because of its comfortable design, diversified styles and rich colors. .

V. Analysis of the operating mode of soft furniture industry

The particularity of the business model of soft furniture industry is mainly reflected in its sales model. At present, domestic soft furniture manufacturers mainly adopt two models of independent brand sales and OEM sales.

1, independent brand sales

The independent brand sales model is based on self-designed R&D capabilities of soft furniture manufacturers, the creation of self-owned sales brands, independent intellectual property rights, and the use of branded strengths to bring products to market through comprehensive sales channels such as direct-operated stores, dealerships, or e-commerce. Business model. Companies that adopt independent brand management have stronger ability to resist risks and can obtain higher profitability, but they have higher requirements for design and R&D capabilities, process technology, and sales channels.

(1) Direct mode

The retail furniture companies directly invest in, operate and manage retail outlets, and adopt vertical and unified management methods for retail outlets. By adopting the sales model of direct stores, companies can effectively control marketing channels and implement corporate development strategies. However, in this model, companies need to invest a lot of their own funds, and the operating costs of the previous period are high.

(2) Distribution model

The distribution model includes franchise distribution and general distribution. Among them, the franchise distribution model means that the upholstered furniture company awards its own brand, trademark, etc. to the franchiser for use in the form of a franchise distribution contract or agreement. Provide personnel training, business management and other aspects of the help; franchise dealers to pay the appropriate costs, according to the franchise distribution contract sales, to bear the business risk; ordinary distribution refers to the soft home business company will own brand products through ordinary dealers Sales and production companies do not participate in the general dealership's store management, brand promotion, and personnel training.

The distribution model is conducive to software furniture companies to quickly expand market channels and expand brand awareness under the premise of less investment.

(3) E-commerce model

Soft furniture companies cooperate with e-commerce websites to promote products for sale on e-commerce websites. Enterprises pay corresponding fees to e-commerce website operators. Business risks are borne by the company itself. Orders acquired by software and home furnishings companies through e-commerce websites are sold by the companies themselves or transferred to the dealers where they are located to complete the sales. E-commerce is an emerging sales model of the software furniture industry.

2, OEM sales

The branded sales model of software furniture industry can be divided into ODM and OEM. Among them, ODM refers to software furniture manufacturers designing and developing products based on market demand or commissioned by customers, and organizing production according to customer orders. The products produced are based on customers' A method of production that the brand sells externally.

ODM manufacturers not only responsible for production and processing, but also responsible for the design and development; OEM refers to software furniture manufacturers fully based on customer's given design and demand for production, product design and development programs entirely provided by customers, OEM manufacturers only undertake processing and manufacturing tasks, OEM manufacturers The products produced are also sold externally by the customer's brand.

Sixth, analysis of barriers to entry into software furniture industry

The soft furniture industry is more competitive and the industry entry threshold is not high, but it is not easy to establish a foothold in the soft furniture industry and become the industry leader. The companies that have just entered the market face certain obstacles in terms of sales channels, brands, design and development, and technology.

(1) Obstacles to sales channels

Sales channels are one of the company’s important competitive resources. Soft furniture industry sales channels include direct sales stores, distribution stores, and e-commerce. Perfect sales channels are the key to the success of soft furniture manufacturers in winning the market. The core stores of some high-quality shopping districts have become an important source of competition for competitors in the industry because of their scarcity.

However, establishing a systematic sales network covering the entire country or even the world requires not only huge capital investment and high operating costs, but also requires extensive channel management experience. Therefore, sales channels are a major obstacle for new entrants in the soft furniture manufacturing industry.

(2) Brand obstacles

Brand is a kind of identification mark, a spiritual symbol, it is a kind of value concept. Soft furniture is a durable consumer product, and the brand is an important reference for consumers' purchase decisions. With the continuous improvement of consumer tastes, the popularity and reputation of software furniture brands will play a very important role in consumers’ purchase decisions.

However, branding is a long-term process. Not only does it require long-term investment, construction, management, and accumulation, but it also requires continuous brand connotation and brand image output. For a new entrant, brand building is almost a blank. Therefore, the brand will become another major obstacle to the new software furniture industry.

(3) Design and development barriers

Design and development is considered as the "soul" of the software furniture industry and directly determines the quality and market positioning of a company's products. With more and more personalized and differentiated consumer demands, original design and independent research and development have become an important power and source for the development of soft furniture manufacturing enterprises.

Facing the increasingly fierce market environment, product individuation and differentiation are the inevitable choices for soft furniture manufacturers. Only by increasing investment in R&D and innovation can companies be invincible in the fierce competition.

However, the first-class design and research and development capabilities have both experienced the brewing of history and the baptism of the times. Each design innovation has embodied a concept and a culture. Enterprises lacking independent original design lose their vitality for sustainable development. How to have first-rate design and research and development capabilities is a problem that new entrants in the software furniture industry have to face. Design and R&D are important barriers for new entrants.

(4) Process technical obstacles

The sophisticated and superb craftsmanship not only provides a reliable guarantee for high-quality furniture manufacturers to produce high-quality products, but also directly affects the production cost of the products, which is an important manifestation of the competitiveness of the company.

However, the skillful and exquisite production process technology needs to be tried and developed repeatedly after many years of production practice. For a new entrant, it is difficult to guarantee the quality of the product and control the production cost without a mature and sophisticated technology. Therefore, process technology is another major challenge for new entrants.

VII. Analysis of Development Trend of Upholstered Furniture Industry

(1) Market capacity will continue to maintain stable growth

The demand for upholstered furniture market is closely related to the real estate market. The first renovation of new houses and the second renovation of old houses require the use of indoor upholstered furniture including sofas, soft beds, and dining chairs.

Some developed countries and regions in Europe and America experienced urbanization earlier, and a large number of existing and old houses need to be renovated to form a stable demand for soft furniture. At the same time, residents of developed countries pay more attention to the comfort and convenience of living conditions. The demand for greater software updates has brought new opportunities for the development of the software furniture industry.

The majority of emerging market countries represented by the BRICS countries have been accelerating the process of urbanization in recent years. The urban population has been continuously increasing, and the construction of new houses in cities has been increasing, gradually becoming a new growth point for global software furniture market demand. According to the statistics of the CSIL, the annual average compound annual growth rate of the global soft furniture consumer market from 2003 to 2012 reached 6.12%, and it is expected that it will continue to maintain stable growth in the future.

From the perspective of China's domestic market, according to the statistics of the National Bureau of Statistics, the urbanization rate of China in 2013 has reached 53.73%. With the continuous advancement of urbanization in China, a large number of rural population will be relocated to cities and towns. The proportion of urban population will continue to increase, which will bring a large number of new urban residential housing needs.

Based on the relocation and decoration habits of Chinese residents, most consumers will replace new furniture when they move into their new homes. The replacement ratio for soft furniture will be higher, which will significantly increase the market demand for soft furniture industry. Urbanization will be domestic furniture. The industry brings tremendous space for development.

(2) Consumers will become more and more demanding on the quality of soft furniture products

As the level of disposable income of residents continues to increase, the quality of family life will continue to increase. Consumers are not only demanding soft furniture products to meet basic use functions, but also pay more attention to the connotation and quality of products, and consumers purchase software. When it comes to furniture products, it will pay more and more attention to its brand positioning, design philosophy, and health and environmental protection factors. Consumers' demand for soft furniture products has changed from the original satisfied consumption to the enjoyable consumption.

In the future, manufacturers of upholstered furniture will need to increase investment in branding, design, and environmental protection to cater to consumer demand for high-quality upholstered furniture products. With the unique brand connotation, insisting on the original design concept, using green environmental protection new materials, and soft furniture manufacturers that can meet the individual needs of consumers will stand out in the industry competition.

(3) Production companies will pay more attention to independent brand management and brand building

Brands are one of the important considerations for consumers to choose goods. Products with good brand awareness and reputation are often considered to represent better quality and service.

After the accumulation of time, the brand finally forms a unique fashion style or represents a certain way of life, which is gradually accepted and respected by consumers.

This kind of consumer psychology of consumers has increased the desire to purchase superior brand products, and has enhanced the market competitiveness of the dominant brand enterprises.

Soft furniture companies want to stand out in their peers and obtain higher gross profit margins, they need to have a clear brand positioning and a well-accepted brand connotation, and then rely on mature business models and sales channels to sell products externally to meet their goals. customer's demand.

Therefore, strengthening self-owned brand management and brand building, forming a clear brand positioning and brand connotation, and gaining a competitive advantage by increasing the brand's added value of products have become an important trend in the development of the software furniture industry in the future.

(4) The trend of integration of furniture and furniture becomes more and more obvious

A complete set of furniture refers to a set of furniture products provided by the same brand of furniture manufacturers to consumers for one or more indoor spaces (living room, bedroom, restaurant, etc.).

Compared to single-category furniture, complete sets of furniture can save consumers from spending a lot of time selecting, matching, and purchasing styles and styles of different brands of single-category furniture products, and can meet the overall personalized needs of consumers for furniture products. .

Home integration means that home system service providers provide integrated services such as interior decoration design, hardware construction, and furniture product procurement. Home integration minimizes consumers' design, construction, decoration, furniture, and other home elements. The coordination and matching costs meet the needs of consumers to save time, labor, and cost to create a personalized home environment.

The integration of furniture and furniture will become an important development trend of the upholstered furniture industry in the future. In order to adapt to the development trend of the industry, soft furniture manufacturers in the future will need to continuously enrich their product categories and service functions, from a single product to a complete set of products, from simply providing products to providing home integration services, in order to meet consumer demand and improve Market competitive advantage.

(5) Product sales channels will be increasingly diversified

Due to the fierce market competition in the soft furniture industry, in addition to product design and quality assurance, whether or not a high-quality, highly efficient sales channel has become an important factor in the success of soft furniture companies in the industry.

The traditional sales model of the upholstered furniture industry attracts consumers by seizing physical storefront resources and improving the actual experience of customers. It is beneficial to maintain the competitive advantages of software and home businesses by grasping the resources of the storefronts in prime locations.

In recent years, with the rise of e-commerce, consumer shopping habits are also changing. Through the platform of the e-commerce website, it is possible to clearly display samples to consumers in all directions, reducing intermediate links and making direct transactions between producers and consumers become a reality.

The e-commerce model can not only greatly reduce manpower and material resources consumption, thereby reducing the cost of sales, but also can break through the time and space constraints, making the transaction more convenient to achieve, thereby greatly improving the sales efficiency.

In the future, the e-commerce model will become an effective complement to the existing entity store sales model. Under the premise that the software furniture industry adheres to the entity store as the main sales model, the sales scale of the new e-commerce model will also be further expanded, and has a relatively broad Market space.