Market Research on Office Furniture
Over the five years to 2011, the office furniture manufacturing industry has encountered tough conditions. High levels of unemployment and low-business sentiment following the economic recession have created little drive for office furniture demand since 2005. This has caused a decline in the general supply, and consequently a decline in the volume of goods supplied by manufacturers. In the meantime, rising import penetration from China continues to hurt industry sales further, as China produces goods at much lower costs. However, demand conditions are improving as the US economy recovers from recession and that businesses have begun to expand operations. We will focus on office furniture for corporate executive, home office, small business and others.
The Bureau of Labor Statistics (2011) estimated the number of executive, administrative, and managerial employees in the United States to be almost 16.4 million and is anticipated to keep on growing. This number is growing at 1.7% per year. It is suggested that the number is growing at the same 1.7% annually. In 2009, there were 27.5 million small businesses in the United States (Office of Advocacy estimates). The latest available census data indicates that there are 5.9 million firms with employees in the year 2008 and 21.4 million without employees in the year 2008. Small businesses, which have employed less than 500 employees accounted for 99.9 per cent of the total (employers and non-employers).
The size of American population working from their homes increased significantly from 9.5 million in the year 1999 to 11.3 million in the year 2005. Half of this population was making at least $75,000 a year; this is according to the figures, which were published by the U.S. Census Bureau. In a report that was released recently, the report is titled “Home-Based Workers in the United States: 1999-2005,” it was established by the Census Bureau that almost half of the population that worked from home in the year 2005 was comprised of university graduates and earned $75,000 or more annually.
The goal of this office furniture offering is to provide very fine furniture with the state of the art technology; this will be combined with a conventional sense of fine woods and carpentry. The market of the furniture can be the corporate executive, home office, small or medium business and others. The common link is the appreciation of quality. In addition, the furniture provider will ensure quality of furniture workmanship, excellence of design, and an understanding of technology built in.
The target market needs are anticipated to grow due to the special needs of personal computing and the increasing demand for office furniture such as monitors at the correct height, keyboards at the correct height, proper cables channels and other amenities. The target population will be offered all of that, in addition to fine furniture. The idea is not only to sell office furniture, but also excellent office environment and design, plus workmanship.
From the above discussions, the market segmented is thus:
Corporate executives: The market research shows approximately 2.5 million potential clients, these comprise of managers from big corporations. Small business owners: The business owners who own business with less than 500 employees offer a valuable market for furniture since these businesses comprise a substantial part of all businesses. Small businesses with fewer than 500 employees comprised of 99.9 percent of all the businesses.
Home offices: as earlier on indicated the number of Americans working out of their homes has increased substantially from about 9.5 million home offices in the year 1999 to about 11.3 million home offices by the end of 2005. This is a big market, and the growth rate is seemingly fast. Thus, we expect a good market here.