The first six months of 2022 proved to be decidedly positive for the German furniture market. In the first half of the year, in fact, sales of German furniture manufacturers increased by 13.4 percent to 9.5 billion euros. “The growth in sales mainly reflects the increase in the cost of materials. Quantitative growth was significantly lower than sales growth. Meanwhile, June showed weakened momentum with a 4.3 percent increase in sales,” commented Jan Kurth, managing director of Vdm/Vhk.
Domestic sales increased by 13.8 percent, partly due to the high order backlog at the end of 2021, while foreign sales of the German furniture industry increased by 12.6 percent. “A decidedly positive trend that has reversed since March due to the negative effects of the war in Ukraine and the sharp increase in transportation and logistics costs,” Jan Kurth continued. “When evaluating the current results, one must also refer to the previous year’s data: sales of German furniture manufacturers increased by 4.1 percent overall in the first half of 2021. At that time, domestic sales increased by 1.1 percent and foreign sales by 10.7 percent. Current sales of German furniture manufacturers, both domestically and abroad, are well above the 2019 level and thus above the comparative values before the crisis dictated by the “Covid-19″ pandemic”.
THE VARIOUS COMPARTMENTS
According to official statistics, kitchen furniture recorded a strong sales increase of 12.4 percent to about 3.2 billion euros, once again proving to be an important growth engine for the sector. Upholstered furniture manufacturers recorded the highest sales increase, with sales rising 19.1 percent to 577 million euros from January to June 2022. Sales development in the largest segment of the furniture industry-other furniture (including living room, dining room and bedroom furniture) and furniture parts-was also “more positive” than the industry average, with a 17.1 percent increase to 3.3 billion euros.
Like the previous year, the consumer goods-related segments of the furniture industry show slightly better economic performance than the capital goods segments. The office furniture industry recorded a growth of 10.9 percent with sales of about 1.06 billion euros. Manufacturers of store fittings and other contract furniture increased by 13 percent over the previous year and achieved sales of 968 million euros.
A look at individual export markets reveals the following picture: in most European countries, sales increased significantly against the backdrop of overcoming the negative economic effects of the pandemic crisis and the lifting of travel restrictions. “Particularly pleasing and not necessarily predictable is the increase in exports to the United Kingdom with a strong 17 percent increase,” Kurth pointed out. “After the signing of the trade agreement with the EU, the British market experienced a brilliant comeback and became the fifth most important export market for the German furniture industry. France still topped the list of most important export markets with a slight minus 2.8 percent, followed by Switzerland with plus 3 percent, Austria with minus 3.4 percent and the Netherlands with plus 11. 6 percent. Significant growth was also recorded in other important European export markets such as Italy, Spain, Poland, the Czech Republic and Norway.”
IMPORTS
German furniture imports increased significantly in the first half of 2022 by 13.5 percent to 5.8 billion euros. In particular, imports from China increased by 24.1 percent to nearly 1.9 billion euros. “The growth in the value of imports was mainly due to the significant increase in the price of furniture made in China: the volume of imports decreased by 8.6 percent over the same period,” Vdm/Vhk’s CEO points out. “In terms of the value of imports, China is ahead of Poland (plus 10.6 percent). Poland’s share of total imports fell to 26.2 percent. Imports from Italy in third place decreased slightly by 0.5 percent. Imports from Vietnam (plus 31.9 percent), Turkey (plus 80.4 percent) and Lithuania (plus 19.2 percent) increased significantly.”
Here is another look at the employment data for the sector: 78,712 people work in the current 451 companies with more than 50 employees (down 1.5 percent through June), which means we are slightly below the previous year’s level of 0.2 percent. Despite the negative effects of the war in Ukraine, employment in the sector has been held steady so far.
“With the current order situation, light and shadow are close. According to internal surveys of trade associations, incoming orders in the German kitchen furniture industry increased by 15.5 percent in the first seven months of 2022, by 12.1 percent in the living room furniture industry, and by as much as 25.3 percent in the upholstered furniture industry . This has created a cushion of orders that is expected to last into the second half of the year. Despite the unquestionably difficult conditions, we are confident that the themes of living and furniture will remain the focus of consumer attention. One’s home remains a safe haven in uncertain times. Against this backdrop, we expect volumes to decline slightly and sales to increase by 6 to 8 percent for the German furniture industry in 2022 as a whole due to price effects. In February, even before the outbreak of the war in Ukraine, we had forecast sales growth of about 10 percent,” Jan Kurth concluded.
