Excerpt From The GA Wright Report On Home Furnishings

Furniture World Magazine

Sales at furniture and home furnishings stores are booming and that boom can be expected to continue, especially for upscale stores. This is a result of the rise in new and existing home sales throughout 1998. Furniture and home furnishings sales lag home sales. Harry S. Dent, a futurist, consultant, and the author of "The Roaring 2000s" has looked at demographic changes and how they effect the economy, and concludes that the average age at which people move up to their largest and most expensive home is 43. They then spend the next three years, to age 46, furnishing this home. He points out that the baby boom generation, born between 1946 and 1964, started to hit age 43 in 1989, and that the rest will reach age 46 by 2010. The greatest number of births per year occurred between 1958 and 1963. It follows that peak spending for home furnishings will likely occur between 2001 and 2009. These statistics suggest that there should be a number of years of good business for home furnishings retailers. New household formation, however, occurs at about age 25. According to Dent, this group will start by renting an apartment and will then buy a starter home between ages 33 and 34. The number of 25-year-olds is now hitting a 30-year low and will not start increasing in numbers before 2003. People who have just started their careers and are buying their first homes need everything at once. They are on a budget and are therefore inclined to shop in a store where they can buy all the home furnishings they need, at the lowest possible price. They are the classic customers for a big box home furnishings store. This provides a reason that the large furniture chains have not done well in recent years. It will be some time before great opportunity will return for the mass marketers of home furnishings. At age 46, consumers have higher incomes and fewer obligations, since children are moving away from home. They tend to have a wider variety of lifestyle interests and are less inclined to follow mass-market trends. They want quality, service, and unique styling. These are the ideal customers for specialty home furnishings stores like Eddie Bauer, Crate and Barrel, and Ralph Lauren, or upscale independents that cater to niche markets. Upscale chain stores and independents selling home furnishings will do well and experience growth through 2009. Gary Wright, the president of G.A. Wright, Inc., has been a retail management consultant since establishing the company in 1981. The company, with headquarters at 4105 Holly Street, Denver CO 80216, specializes in producing marketing programs tailored to the specific needs of individual retail companies. Phone: 303-333-4453.