Home furnishing sales have seen a jump this year and are expected to stay strong during the holidays. Holiday spending overall is expected to increase by 4.1 percent according to the National Retail Federation. Better yet, IBM is predicting home stores will do more than that and see at least 7 percent growth during November and December. Yearly sales are expected to end up over 9 percent higher than last year. Seasonal shopping sprees and purchases of new holiday decor aren't the only things driving the increase, though. Hint: it has something to do with roommates and dragons.
Consumers this year are turning their attention and dollars to shopping for the home and for practical gifts. Holiday spending for home furnishings is expected to be up while spending on electronics such as televisions and entertainment systems is expected to be down. Comparatively, men's and women's apparel is estimated to rise only 2.49 percent.
Consumer confidence is helping drive more business for the furniture industry along with higher home sales. Another factor leading to increased purchases of sofas, tables, chairs and more is an increase in multi-generational homes as aged parents move in and fewer college-age "kids" move out. Recent studies by the U.S. Census and the Pew Research Center show:
- Multi-generational homes have increased by more than 1.2 million over the past few years
- 76 million family households in the U.S. today are multi-generational
- 41 percent of adults between the ages of 25 and 29 are living with their parents or have in recent years
Circumstances such as unemployment, higher living costs and less availability of rental housing have contributed to this increase. As families settle in to accommodate extra folk around the dinner table, more purchases are made in the home furnishings and home improvement categories.
Another reason for the increase? 2012 was the Year of the Dragon according to the Chinese Lunar Calendar. IBM found a correlation between "Dragon Years" and furniture sales. The Chinese Year of the Dragon is considered a lucky time to marry or have a child, two factors that often lead to new purchases as homes and families expand. In fact, the previous Year of the Dragon, twelve years ago, was a very good year for furniture sales.
What's coming up? 2013 will the be Year of the Snake. But have no fear, snakes represent renewal and are also considered good luck.
Lots of opportunities lie ahead for the home furnishings industry as the economy rebounds and your customers get back to remodeling projects and home purchases. Add in holiday sales, adult children moving home and more marriages, and the future looks good for home furnishing businesses.
Is your business set up to take advantage of increased sales during the holidays and into the new year? Contact CrossCheck for check processing solutions for the home furnishings industry.