Business news: Folding Furniture Manufacturing in the US Industry Market Research Report

Despite growing demand for folding tables across many markets (e.g. schools, banquet halls, hotels, churches, hospitals), the Folding Furniture Manufacturing industry is facing increasing price pressures from low-cost imports and rising raw material costs, including of aluminum, resin and plastic. Additionally, manufacturers were challenged by the recent economic recession, which caused demand for folding furniture to plummet across most of the industry's downstream institutional and commercial markets. Import penetration and intense price-based competition will continue to challenge folding furniture manufacturers in the five years to 2017. In a competitive environment, many firms will be unable to pass on increased production costs to customers and profit margins will, in turn, remain under pressure. The firms that open up new markets through product innovation, however, will be better positioned to pass on rising production costs. For these reasons, industry research firm IBISWorld has added a report on the Folding Furniture Manufacturing industry to its growing industry report collection.

Despite growing demand for folding tables across many markets (e.g. schools, banquet halls, hotels, churches, hospitals), the Folding Furniture Manufacturing industry is facing increasing price pressures from low-cost imports and rising raw material costs, including of aluminum, resin and plastic. Additionally, manufacturers were challenged by the recent economic recession, which caused demand for folding furniture to plummet across most of the industry's downstream institutional and commercial markets. As a result, industry revenue is estimated to decline at an average annual rate of 5.9% to about $144.3 million in the five years to 2012.
Growth in the volume of imported folding furniture has created an intense trading environment for domestic manufacturers. Lower-cost imports have become increasingly popular over domestic goods, and imports are expected to account for a significant share of domestic demand in 2012. The recession boosted price-based competition, and its impact on income levels and consumer spending caused a steep drop in demand from wholesalers, retailers and most industry clients, including school districts, hotels, banquet halls and event planning businesses. Folding Furniture Manufacturing industry revenue shrunk from 2007 through 2009, with the steepest decline of 26.0% occurring in 2009. That year, the number of enterprises and jobs also dropped (11.4% and 22.0%, respectively) as struggling firms laid off workers, shut down plants or went out of business altogether. High unemployment rates and low businesses sentiment during the recession created an intensely competitive environment for existing players. Faced with eroding margins and volatile input costs, many underperforming yet well-established operators were forced to exit the market or move abroad. Most companies in the industry are privately owned and employ fewer than 30 people. As a result, industry market share concentration is moderate and has increased during the past five years.
Although the industry is expected to experience revenue growth in 2012 and 2013, market saturation and intense competition from imports will limit growth through 2017. By then, imports are expected to account for a greater share of domestic demand. These trends will keep revenue growth relatively flat over the next five years. Although average industry profit has improved slightly since 2007, intense price-based competition and input price volatility will continue to pinch profit over the next five years. The prices of commodities needed for manufacturing, particularly nonferrous metals like aluminum, are forecast to increase as economic recovery boosts demand. In order to better compete in a saturated market, firms will increasingly turn to product innovation to gain market share, which will also allow them to seek opportunities in export markets. For more information, visit IBISWorld’s Folding Furniture Manufacturing in the US industry report page.

IBISWorld industry Report Key Topics
This industry manufactures folding furniture, including tables and chairs, that can be collapsed for easy storage and are most often made of plastic or basic metals. Foldable beds, ladders, shelves, sofas, armchairs, cabinets, carpet squares and mobile furniture manufacturing operations are not included in this industry. Furniture intended exclusively for outdoor use is also excluded from this industry (see IBISWorld report OD4821, Outdoor Furniture Manufacturing).

About IBISWorld Inc.
Recognized as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every US industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Los Angeles, IBISWorld serves a range of business, professional service and government organizations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.com or call 1-800-330-3772.