Nowadays, consumers are replacing their furniture more frequently than in the past, mainly due to increasing living standards and a steady income increase across the board. These are only some of the factors driving the Furniture market’s continued growth worldwide, but were you interested in what the Furniture market in Germany is like? For example, have online sales increased in this sector? Or maybe customers are still more focused on purchasing in brick-and-mortar stores?
We will answer these and many more questions in this report, so stay tuned!
Furniture market overview
The German furniture industry is one of the most lucrative in the European Union. It’s a leading furniture exporter too. Germany’s primary export furniture market in France. Poland, China, the Czech Republic, Hungary, and Italy are the major sources of imports.
One of the upcoming trends in the German furniture market is furniture made of natural materials combined with innovative design. Therefore, foreign premium producers can find considerable market opportunities in this segment. In general, natural materials are becoming more expensive, but there is a significant trend. As the labor cost in Germany is comparatively high and furniture production is labor-intensive, the production requirements are fulfilled by countries such as China and Bosnia, which have cheap labor costs. As a result, one out of ten pieces of furniture sold in Germany comes from China.
In the kitchen furniture market in Germany, growth is being experienced not only in terms of sales but also in terms of innovation and new product launches. On the other hand, the trend for home and bedroom furniture is more driven by international sales, and therefore, the growth is driven mainly by exports.
Furniture sales in Germany
The pandemic effect
Some companies could not keep their manufacturing sites open during the Coronavirus lockdown. Even though the company had to close its showrooms to the public, it quickly upgraded its capabilities to “meet” and engage with clients virtually. Home-based salespeople had the technology they needed to assist customers who were also at home.
Through these tactics, the companies were able to survive and to reach a new target group who, during the lockdown and travel bans, realized how important it is to make their home comfortable.
The best shipping service providers in 2020
Companies use different shipping service providers based on the product they are shipping and the country they are shipping to. Below is a table showing the top three providers in the German Furniture market.
Shipping service providers in Germany in 2020
Orders are shipped from the store’s leading country, which is the one where most of its online revenue is generated. As a result, DHL was the most commonly offered shipping service provider in the Furniture & Appliances market in Germany in 2020. When asked which service they use to transport their goods, 64% listed DHL as one of their choices. Additionally, DPD and Self-collection / Click & Collect are among the top three shipping companies offered by German online retailers in the Furniture & Appliances segment, with rates of 24% and 18%, respectively.
Germany’s leading online store for furniture
eCommerce has not yet gained the ground it deserves in the furniture and homeware category compared to other product categories. Most consumers are still drawn to offline furniture stores that provide for them better solutions like a touch-and-feel experience when furnishing their homes.
According to the Statista Digital Market Outlook, only 24% of total revenues in the global Furniture & Homeware market were generated via online sales channels in 2021. That is 10% more than 2020, but it’s still not enough. Although China already has an online market share of around 50% in the Furniture market, Germany is still heavily offline-focused.
If we’re talking about Germany and its furniture market, the largest segment is the Living-Room & Dining-Room Furniture, with a market volume of US$15,366m in 2021.
What was the 2019/2020 increase in net sales for the most significant players in the online furniture market in Germany? Here they are:
The top 10 most prominent players in Germany
As you can see, in the top three, we have companies like Otto, Ikea, and Amazon. Otto.de leads Germany’s online store in this category with 2020 domestic net sales of €1.5 billion. Otto.de is also among the top players when it comes to growth. Ikea.com and Amazon.de are in ranks 2 and 3, respectively, with 2020 net sales amounts of €646 million and €555 million.
Growing potential for online furniture sales in Germany
Many of Germany’s top online furniture and homeware stores are likely to continue developing their net sales at these growth rates. Therefore, there is a great deal of potential for ecommerce businesses in this market.
And why is it said ecommerce in Germany will grow? Because retailers are trying to remedy reluctance to buy online, they introduce various ideals. For example, they have started offering 3D product visualizations or augmented reality apps which are helping when purchasing online. Therefore, the sale of furniture online is slowly gaining traction in Germany, with retailers such as Ikea and Otto adopting strategies such as omnichannel shopping. As a result, consumers can overcome existing resistance with omnichannel concepts that combine stationary showrooms with online distribution channels.
Over to you
The German furniture market is very offline-focused, yet it doesn’t mean Germans don’t buy online. Otto.de is the biggest online store with net sales of 1.5 billion euros, which already means something. As a result, the German furniture market will likely see substantial growth potential from online furniture sales.
In the digital age, retailers need to stay in touch with their customers as they often prepare offline to shop in-store, find out about exciting products in advance, and then shop online. As a dealer or manufacturer in the furniture segment, you need to be prepared for this.