GREENSBORO, NC - The tide is slowly starting to turn in favor of the American furniture industry in terms of sales, but manufacturers and retailers continue to face numerous wide-ranging challenges that demand responses. These include:
Sluggish economic recovery
Shifting consumer buying preferences
Skilled worker shortages
Rising labor costs
Technology integration issues
New distribution channels, and
Increased global competition.
These are some of the findings released by Anderson Bauman Tourtellot Vos (ABTV), a corporate transformation consulting firm, in its 2014 Furniture Industry Watch Report, an annual update that details the current state of the furniture industry.
One of the biggest hurdles facing the industry, according to the report, is the need to communicate simultaneously with multiple audiences now active in the workforce and consumer populations, from Millennials to Baby Boomers.
The labor shortage that exists within the manufacturing sector, the report says, is caused by an aging workforce that is rapidly depleting the skilled worker pool. Further complicating the situation is that younger workers are not looking for manufacturing jobs. The industry must find ways to dispel long-held industry misperceptions in order to attract and retain a younger, skilled and reinvigorated workforce given that, by 2020, 50 percent of the workforce will be comprised of Millennials.
The furniture industry faces a consumer audience today that has multiple needs, the report finds. Baby Boomers are downsizing from family homes to co-op-type arrangements. Millennials, straddled with college debt, are postponing home ownership and choosing instead to rent small living spaces that require less furniture.
Distribution channels are changing, too, driven by generational issues. Up to now, brick-and-mortar retail stores have been the primary method for furniture manufacturers and retailers to market and sell directly to consumers. But, the Internet is slowly changing the landscape, with the growth of 24/7 e-commerce market alternatives. Consumers are becoming more comfortable purchasing furniture sight unseen from online sources. When it comes to marketing, younger consumers only want to receive highly relevant advertising appropriate to their interests—and electronic devices.
"Traditionally, the furniture industry has not been known for understanding its target audiences and marketing itself well to them," says ABTV Managing Director Peter Tourtellot. "Young buyers today have largely been ignored by the industry in terms of furniture design, advertising, marketing, and the availability of younger retail sales people. When it comes to marketing, it's all about relating to their needs."
Anderson Bauman Tourtellot Vos, with offices in Greensboro, Charlotte, Atlanta. Jacksonville and Richmond, is a corporate transformation consulting firm that provides interim executive management, planning, fraud investigation and services to support underperforming companies. www.abtv.com. 336-275-9110. @ABTVandCo
Source: Anderson Bauman Tourtellot Vos
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