Current trends in the furniture supply chain and the influences behind them

Currently, the furniture industry is still exposed to significant uncertainty. Having recently travelled around multiple furniture factories, I have seen manufacturers in countries like Poland and Sweden suffering from decreased demand. The decrease varies from 15 to as much as 50%.

But of course, that isn’t the only trend we currently observe in the furniture supply chain. Let’s oversee the other ones and discuss what influences them the most.

1. Change in furniture demand

As I have already mentioned, the change in furniture demand is drastic. Some major manufacturers admit having never faced such a fall. The numbers vary, but I have personally been told that certain orders have been reduced by 50, 43 or even 73%.?

2. Focus on product improvement

Naturally, with such a decrease in demand, manufacturers look for ways to improve their products or, in other words, maximize lean manufacturing. This means minimizing unnecessary expenses while retaining product quality. Changes vary from looking for ways to reduce the use of material, swapping certain parts for others, selecting different coatings, and so on. However, maintaining quality remains a priority.

3. Energy saving

Highly increased energy prices are forcing manufacturers to look for ways to save on energy. Luckily, the warm winter in Europe contributes to this goal. However, warm weather is simply not enough, and companies are still looking for ways to minimize their energy use. Some of the most popular methods include performing professional audits on energy consumption, using state aid, regular unit maintenance, and so on.

4. Changes in people management

With reduced demand and increased costs, companies are also looking for ways to save through the management of people. Many employees are being laid off or sent on holiday for a week or even a month. It comes as no surprise that the furniture industry has faced multiple protests from dissatisfied employees when manufacturers try to save at the expense of people.

Complex issues

While it is fairly easy to determine separate trends, it is worth noting that most of them are caused by the same – although complex – reasons. These include a complicated geopolitical situation (the main reason for increasing energy costs and, thus, overall living costs) and a climate crisis, which can affect thew supply chain significantly. That being said, it’s the same climate crisis that is causing an unusually warm winter, thus somewhat helping save on energy. Although by no means should we rejoice in it –?as the past suggests, we are likely to pay for it with hurricanes, floods, droughts, or other catastrophes that can cause further disruptions.

It is only fair to mention that certain furniture manufacturers are already looking for ways to reduce their carbon footprint and thus contribute to solving the climate crisis. So far, the most popular approach is incorporating recycled materials, which reduces waste and, in turn, carbon footprint. However, companies like Henkel are taking things a step further by introducing furniture elements made of entirely different, environmentally friendly materials. In Henkel’s case, it was adhesives –?made using the “mass balance” approach, they reduce the carbon footprint of the adhesive and ensure that furniture can be made with fewer fossil-based elements.

My belief is that this will soon become the new normal – with more and more consumers regarding environmental impact as a strong influencing factor, companies will be forced to look for sustainable solutions, thus pleasing potential buyers and minimizing harm to our environment.