A report on retailers shows a steady drop in visitors to stores, as consumers shop increasingly online. The brown paper ltaped inside storefronts seen in a visit through suburban malls large and small bears this out: people aren't shopping in person.
This is not an encouraging bit of news for architectural woodworking companies that specialize in this area, or for slat wall and retail display component manufacturers. The American Institute of Architects predicted robust growth in retail: 11.7%. But because of this fundamental shift in consumer behavior, economic recovery may no be lifting all boats in the wood business.
While digital technology impacts woodworking favorably on the design and manufacturing side, it's also creating downward pressure on the sales side. The parts of the market that went "digital" first for shopping - record stores come to mind, bookstores, electronic stores - are being followed by more essential categories, like drugstores. Walgreen's, the nation's largest chain, reported a 2.6 percent drop in store traffic last month; and its rival CVS also saw declines.
Even store-centered IKEA? The trendy Swedish giant said in its annual review that IKEA U.S. sales grew 6.7% last year; but online sales rose 65%. Worldwide, IKEA said its store traffic is down 1%, while its online sales are up 20%.
Those furniture sales drive factory floors for casegoods, table and chair manufacturers. But not for the businesses building out store interiors.
Perhaps the net effect will be a plus for wood manufacturing overall. If you are serving only retailers, it's time to diversify into growing areas like healthcare, hospitality and food.
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