Market Research Reports - Ken Research Ready to Assemble Furniture Market Outlook

Ready to Assemble Furniture Market Outlook: Ken Research
Introduction: Ready to assemble (RTA)furniture is a concept introduced roughly around the
1850’s which allowed for two primary benefits- the reduced cost of labor as assembly was
expected to be done by the customer, and a reduction in the requirement for space as the
furniture was shipped as parts and not as the finished product. This reduction in labor and
space became a favorable trend for manufacturers which was expected to be continued in
simplistic component based furniture. Another major benefit in using ready to assemble
furniture was that there was a shortage in manufacturing time as well. The reduction in time
requirement and the cost saving from reduced requirement for space and labor led to
manufacturers attempting to maximize the sale of ready to assemble furniture, primarily for
low margin products which would boost profitability. High value furniture which earned a
premium for manufacturers would not usually be ready to assemble as the price of the
furniture was quite high and did not justify the need for reduction in cost of delivering and
manufacturing. Although the RTA concept did not work with premium customers, the reduced
cost of furniture due to the need for customer assembly was highly accepted by low and middle
income customers who could now manage to afford better quality of furniture just by
assembling it themselves. This began the trend of assembling furniture for cost savings for
consumers and manufacturers.
Market Overview: The ready to assemble furniture market is growing steadily. The market,
which was valued at over USD 10.5 Billion in 2014, has grown to USD 11.8 Billion in 2017 and is
forecasted to grow to over USD 16 Billion by the year 2025 as per the most recent Furniture
Market Research Reports. The growth of ready to assemble furniture is primarily attributed to
the growing needs for functional and effective furniture at a lower price for low and middle
income households. Another key driver is the increasing trend of Do It Yourself market
participants towards assembling their own furniture. Given the growing need for functional and
economic furniture which can be fit into smaller households and still is a low cost for
consumers, there is a major need for furniture that is sturdier and is capable of usage for longer
periods of time. Ready to assemble furniture is primarily purchased on the basis of utility. The
sales channels usually is through direct manufacturer sales as a majority of categories of RTA
furniture are sold directly. RTA furniture covers almost all sub categories of furniture ranging
from tables and chairs to more sophisticated furniture like book shelves, work desks and sofas.
The increasing popularity from the industrial side is owing to the level of cost savings that is
availed by major manufacturers on manufacturing and transportation. This is vitally important
for furniture which is sold to low and middle income households where the profit margin for
the furniture is considerably low.