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With the consumption upgrade of the furniture industry, the improvement of people’s pursuit of quality of life, the mature concept of furniture consumption, and the improvement of production technology of furniture enterprises, custom home furnishings have emerged. my country’s custom home furnishings are mainly concentrated in custom cabinets, custom wardrobes and other fields. And gradually expand to the study room, children's room, living room, dining room and other whole house furniture areas.

The upstream of the custom home furnishing industry is sheet metal, aluminum, hardware materials, etc., and the downstream is channel merchants and end consumers.

Industry chain of custom home furnishing industry

At this stage, my country's custom home furnishing market penetration rate is relatively low, and there is a large gap compared with developed countries, and there is broad room for improvement in the future. Data shows that the penetration rate of custom home furnishings in my country in 2019 is only 32%, while the penetration rate of custom home furnishings in developed countries is around 60%.

Comparison of penetration rate of customized home furnishings between my country and developed countries in 2019

In terms of category, the penetration rate of the cabinet industry that started earlier is about 60%, the penetration rate of customized wardrobes is about 30%, and the penetration rate of other cabinets is less than 10%.

Comparison of penetration rate of customized home furnishing categories in my country

In recent years, the overall development of my country's customized home furnishing industry has been relatively good. The future demand for renovation of existing homes and the increase in the penetration rate of fine decoration will become the main driving force to promote the rapid growth of the customized home furnishing market. Data show that the market size of my country's custom home furnishing industry in 2019 was 136.6 billion yuan, a year-on-year increase of 7%.

The outbreak of the new crown epidemic in 2020 has caused a certain impact on the custom home furnishing industry. It is expected that the growth rate of the market will decline. However, after the epidemic, the custom home furnishing industry is still expected to rebound. The market size will reach 156.5 billion yuan in 2021. A year-on-year increase of 10%.

Problems in the industry

Industry competition has intensified, and market competition regulations need to be further improved. Although some large-scale leading companies have gradually emerged in the custom home furnishing industry, due to the large market size, many companies have entered the custom home furnishing industry in recent years, especially in the design and development capabilities, product quality control and sales of some small and medium-sized manufacturers. There are certain gaps in service capabilities, resulting in poor product quality, serious product homogeneity, and competition for market share through low-price competition, which affects the image of the industry and the level of profitability, and also has a greater negative impact on consumer experience.

The industry as a whole still needs leading companies with mature operations and quality to establish a good brand image, enhance consumer experience and trust in the industry as a whole, and promote the healthy and orderly development of the industry.

Industry development prospects

1. National and local policy support provides a good market environment

The support of national and local policies has provided a favorable development environment and broad development space for the development of the customized home furnishing industry.

2. The growth of disposable income of urban residents promotes consumption upgrade in the customized home market

With the continuous and rapid development of my country's economy, the per capita disposable income of residents has continued to increase. Statistics show that the per capita disposable income of urban residents in China has risen from 6,859.60 yuan in 2001 to 43,834 yuan in 2020, with a compound annual growth rate of 10.25%.

With the increase in the disposable income of urban residents in my country, the consumption structure and consumption philosophy of urban residents have also undergone major changes. The driving factors of residents' consumption behavior have gradually developed from price and basic demand-driven development to brand, quality, design, and user experience. With the pursuit of comprehensive factors such as aesthetics, environmental protection and shopping environment, residents pay more attention to the needs of individuality and experience when purchasing consumer goods such as furniture. As the economy develops and residents' consumption levels increase, consumption upgrades will drive the continued development of the customized home furnishing market.

3. The continuous promotion of urbanization and the implementation of the second-child policy provide a broad market space

my country is in a period of rapid urbanization. Data shows that the national urbanization rate (the proportion of urban population in the total population) has increased from 57.35% in 2016 to 63.89% in 2020.

In the next few years, my country will actively and steadily promote urbanization, and there is still a lot of room for improvement in the urbanization rate. By enhancing the comprehensive carrying capacity of cities and towns, we will orderly promote the urbanization of the agricultural transfer population, and the promotion of urbanization will bring about a large number of new housing needs and provide a broad market space for the customized home furnishing industry.

At the same time, with the full liberalization of the second-child policy, the emergence of two-child families will stimulate the demand for newly-purchased commercial housing decoration and the second decoration of old houses, which can drive the development of the entire custom home furnishing industry.

4. A mature and complete industrial chain provides an important guarantee for the development of the industry

After years of development, my country's furniture industry has formed a relatively mature and complete industrial chain, which can fully meet the needs of upstream raw materials, downstream sales and other linkages and supporting industries.

At the same time, with the rapid development of related industries such as the Internet of Things, artificial intelligence, advanced production technology, and new environmentally friendly materials, the process of conversion and application in the customized home furnishing industry is also accelerating, which provides an important guarantee for the development of the overall customized home furnishing industry.