The year 2019 will be remembered, albeit not too fondly, as the year of tariffs. The imposition of first 10%, then 25% tariffs on furniture, lighting and other product and supply categories out of China caused a seismic change in manufacturing strategies. Vietnam emerged as the primary beneficiary, although exactly how beneficial and how long it will take before goods flow smoothly and at consistent quality levels remains to be seen.
Changing supply strategies unleashed myriad ripple effects including the rethinking of traditional relationships, a realignment of product assortments to minimize the tariffs’ impact and, in some instances, the outright discontinuation of select product lines or the dissolution of once formidable players. The impact of tariffs was far less evident to U.S. furniture consumers, as suppliers, manufacturers and retailers worked in concert to minimize the impact at point of sale.
While at this writing the 25% tariffs on some $250 billion of Chinese goods — which have been the most impactful to the furniture segment — remain in place, the necessary adjustments have largely been made, and 2020 should see the focus shift to more traditional concerns. That said, the first half of the year is likely to see some supply chain challenges as capacity catches up with demand and as companies work through the disruptions that often accompany supply shifts.
On a more positive note, the economic indicators that support furniture sales remain generally positive; the giant demographic bubble that is Millennials moved one year closer to their prime furniture purchasing years, and the seemingly inevitable Retail Armageddon has proven to be more myth than mayhem. This is not, of course, to suggest that some retailers will not go away; some always do. However, the value of physical locations that can entice, educate and enable consumers to experience product endures.
Moving in to 2020, it is increasingly clear that the dividing lines separating physical from digital shopping are blurring, even disappearing. New tools and strategies are emerging daily to better engage with potential furniture shoppers in ways that integrate education and enticement with entertainment. The result is a path to purchase that bears little resemblance to the traditional “sales funnel” and instead creates something far more interactive and better integrated into consumers’ everyday lifestyles.
If 2019 was the year of tariffs, 2020 is likely to be the year of technology. From ideation to installation, in the home technology is fundamentally reshaping every step of the product development and consumer purchase-path cycles. Even products themselves are being refined or reinvented to better integrate with a consumer lifestyle that has become increasingly defined by technological integration.
The pages of this year’s Retail Planning Guide tell an evolutionary — not revolutionary — story on the product front. Demographically driven categories appear to be gaining momentum, as are those that better align with consumers’ increasingly casual lifestyles. The American home and the ways that consumers live, eat and socialize continue to evolve, and those products that align with that evolution remain best-positioned to deliver strong, sustainable growth.
2019-12-23 11:21:24Z
https://www.furnituretoday.com/opinion/furniture-everyday/blog-whats-ahead-in-2020-the-year-of-technology/
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