Sales for producers of office and contract furniture fell sharply in 2009, but this same sector recorded a gain in sales and production last year, and 2011 is fulfilling the forecast to be another positive year.
U.S. production of office furniture reached $8.3 billion in 2010, a gain of 5.8 percent, according to the Business and Institutional Furniture Manufacturer’s Assn. Overall consumption in the sector, which includes imports, increased 7 percent to $9.877 billion in 2010. In 2009, consumption fell 29 percent and U.S. production was down 29.7 percent to $7.845 billion.
The largest publicly traded companies such as Steelcase, HNI, and Knoll are reporting stronger quarterly sales in late 2010 and early 2011.
Overall, sales for the FDM 300 group of companies, including the 300 largest cabinet, furniture and millwork producers, amounted to $38.49 billion for the year 2010, a decrease of 6.4 percent from 2009 sales of $41.14 billion.
For 2011, BIFMA expects big things for the U.S. office furniture market. The HIS Global Insight industry forecast model shows a gain of 16.6 percent in consumption to $11.5 billion, and production gaining 14 percent for the year to $9.5 billion. The forecast for 2012 is also positive: a 9.6 percent gain in consumption to $12.6 billion, and an increase in production of 8.4 percent to $10.3 billion.
About half of U.S. exports go to Canada, which also accounted for most imports until recently. Canada accounted for 62 percent of imports into the U.S. in 2000, but that share dropped to about 40 percent in 2010. Meanwhile, China’s share of imports rose from 13 to 40 percent for the same period.
In 2010, preliminary BIFMA data showed the largest product category was seating, accounting for about 30 percent of production. Systems were next (about 26 percent), followed by files (13 percent), casegoods (11 percent), and storage (5 percent).
In comparison, sales for cabinet manufacturers in the FDM 300 declined in 2010, but the falloff was much smaller than 2009. In the Kitchen Cabinet Manufacturers Assn.'s monthly Trend of Business Survey, cabinet manufacturers surveyed reported sales of $4.5 billion in 2010, down 4.1 percent compared to total sales for 2009.
Top ten office/contract manufacturers
Steelcase’s fiscal 2010 sales were $2.29 billion (for the year ending in March 2010) and reflected a big reduction in sales. For fiscal 2011 sales were higher, to about $2.437 billion. The company’s primary focus is on the office furniture segment, but healthcare and education are also important areas and were markets that were stronger last year. Three plants were announced as closing in January: Kentwood, Mich.; Grand Prairie, Texas; and Markham, Ontario.
HNI Corp. reported 2010 sales of $1.405 billion, higher than our estimate based on the third quarter figure for office furniture segment. Maxon in Salisbury, N.C., closed in 2010.
Herman Miller Inc.’s figure is from the company and reflects several quarters of stronger sales. The company purchased healthcare furnishings maker Nemschoff, Inc. in mid-2009 and finalized that sale early this year.
Haworth Inc. announced in February that 2010 global sales improved to $1.21 billion, boosted by strong results in North America. Earlier, Haworth closed its Calgary, Alberta, plant and its Allegan, Mich., seating plant.
Knoll Inc. reported $809.5 million for 2010 sales, a solid gain over the previous year.
Global Group operates many U.S. and Canadian locations but our information is incomplete.
KI is emphasizes business, government, education and healthcare markets, and provided a sales estimate. The company closed a plant in Los Angeles.
Teknion provided no new information. This is our estimate.
Kimball International Inc. reported sales of $413.6 million for fiscal 2010 in its furniture segment. Kimball had consolidated some of its southern Indiana plants.
OFS Brands Inc. provided sales and other information directly.
To look at things another way, we selected a group of 20 large and medium-size companies in the FDM 300 for which we had sales numbers or what we felt were good estimates over the past five years. For this group, sales were off only 14.3 percent. This group comprises American Seating, Haworth, Herman Miller, HNI, Indiana, Inscape, Jasper, Jofco, Kewaunee, KI, Kimball, Knoll, Mayline, Nucraft, OFS, Sico, Spectrum, Steelcase, Trendway and Virco. (See accompanying table for year-to-year comparison.)
A complete list of the 2010 FDM 300 companies was in the February issue of CabinetMakerFDM, and the list and more detailed information on each company is on www.cabinetmakerfdm.com.
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