The Furniture & Fixture industry is expected to grow in the coming years. As per the World Furniture Confederation, the global furniture manufacturing industry is estimated to reach $400 billion annually. Success of businesses in FnF industry depends on current, comprehensive, and detailed business insights. This industry is also subject to challenges from price sensitivity, changing cost of raw materials, labor, trends and customer taste. Manufacturing involves a wide array of profiles like personal, household, public use, hospitals, theaters, cafeterias, schools, and other facilities. Furniture is typically made-to-stock or made-to-custom basis and may be sold assembled or unassembled.
The demand in this industry is uncertain due to factors like real estate fluctuations, government policies and politics, and technology updates. With the change in the market trends, that varies with generation, the expectation is way higher than before. They increasingly expect products to be delivered on-demand with unprecedented pressure to rapidly manufacture and deliver products.
Challenges Faced by Furniture & Fixture Industry
Sustainable Raw Material
FnF manufacturers continually strive to keep a balance when sourcing different raw materials especially with global warming concerns. The perspective of unused furniture disposal, reuse and recycle of older furniture also needs due consideration. While couple of sustainable raw materials can be availed now for furniture, sourcing them in optimal quantity is crucial too.
Different Lifestyles Among Generations
The furniture market consumers can be categorized as millennials, generation X, baby boomers, and seniors. With lower disposable income and higher levels of debt, millennials tend to delay their furniture buying decisions — which poses a potential problem for targeting this demographic. The Gen X group, which tends to be more affluent and represents 30% of the market, has different tastes or needs when it comes to furniture and buying preferences. The baby boomers and seniors are the settled consumers who represented 29% and 4% of the market, respectively.
Lead Time Reduction
The FnF industry faces high market volatility as delivery cycles are gradually shrinking. With e-commerce setting the tone for this generation of customers, faster delivery essentially qualifies as competitive advantage for business. Distributors strategically must work to line up the logistics to move the finished goods across distribution centers to meet the delivery timelines.
Rise of Ecommerce
With multiple ecommerce channels available at fingertips, potential buyer using the ecommerce channels is estimated at nearly 47% compared to 40% of Gen X and 37% of baby boomers. To cater to this audience, manufacturers should be ready to customize their products on these channels while ensuring to meet the logistic needs.
New Horizon ERP has been designed to capably monitor production and respond to market fluctuations faster for the manufacturers of FnF industry. From ironing the operation needs, production and distribution, this allows business to stay ahead of their competition. With Sourcepro’s ERP, managing production lines, analyzing market trends, and responding to it is quick and efficient.
Key Components of New Horizon ERP
Key Components of New Horizon ERP for Furniture & Fixtures:
- Material requirement Planning – Inventory can be planned based on minimum inventory level or driven by BOM through distributed multi-site order management capabilities.
- Multi-level BOM & Variable Pricing – Configuring BOM accurately allows to create precise pricing estimates especially for complex products with dynamic pricing.
- Fully-Integrated Quality Management – Satisfied customers with consistent product quality delivered as per benchmark.
- Easy Management of CCN – Engineering change control and tracking can be done in-between production cycles across all internal and external operations.
- Business Insights – Data is available on fingertips and can be analyzed quickly using tools, thereby leveraging it for strategic planning and decision making.