Crestfield Swot Analysis

External Swot Analysis

пÑ"? The household furniture industry is divided into three general categories: wood (43%), upholstered (46%), and other forms (11%). Our industry of wood, medium to high priced makes up 45% of the total market for wood.

пÑ"? According to the American Furniture Manufacturers Association (AFMA) the main types of wood furniture are bedroom pieces and dining room sets.

пÑ"? Total furniture sales at manufacturer’s prices in 2003 were $23.9 billion, total wood sales were $10.28 billion and total medium to high priced wood was $4.62 billion.

пÑ"? The furniture sales were flat in 2003 but trade economists are predicting a 6% sales increase for 2004.

пÑ"? There are more than 1,000 furniture manufacturers in the US and five of them represent about 31% of industry sales, with the top 25 accounting for half of the sales.

пÑ"? Imports (bedroom furniture) make up 25% of sales which have driven down prices by 30% forcing downsizes and the closing of over 60 domestic furniture stores in 2002 and 2003.

пÑ"? Baby boomers make up 47% of all US households, As they become home oriented they replace older, cheaper furniture with more expensive longer lasting pieces.

пÑ"? Consumer spending on wood is closely linked to new housing starts, consumer confidence, and personal disposable income (about 1% of US total disposable income is spent on furniture).

пÑ"? There is currently an increased emphasis on spending family time in the home and there is also an increase in new home sales and sales of existing homes.

пÑ"? According to s survey in Better Homes and Gardens, consumers highly value style, design, construction, comfort and durability when selecting furniture as well as a dependable store. They least value planners, guarantee and delivery time.

пÑ"? Consumers enjoy shopping but lack confidence in accessing construction, quality and value relative to price. They also worry that the style may not be appropriate once they get it home or in the near future. When they do not feel comfortable evaluating these aspects they make choices based on price.

пÑ"? Because the things consumers most value are the things they are not confident in assessing, the furniture industry as a whole has worked to educate consumers. They have conducted in depth studies, improved distribution and added new programs to train sales people. So far their efforts have failed for the most part.

пÑ"? There is a high demand for well informed retail sales personnel trained in qualitative and construction details of the furniture they sale. These programs would cost between $20,000 to $60,000 depending on the quality. Also there is a need to distribute literature to customers via retailers. Brochures would cost between $40,000 to $50,000.

пÑ"? There are over 100,000 retail outlets in the US. 68% of these are specialty furniture and home furnishing stores, department stores make up 15% and 12% are mass merchandisers. The top 10 retailers captured 15% of total US furniture sales. Chains, like Rooms To Go are increasing while independently owned stores are decreasing.

пÑ"? Furniture manufacturers have avoided internet sales for the most part because of the cost of the web site, and the high cost of deliveries choosing to go with a promotional web site for half the cost. These sites showcase new styles and list retailer locations. (However internet shopping and information is on the rise because 90% of the target market has internet access.)

пÑ"? A trend among retailers is the gallery concept in which a large space is dedicated to one manufacturer; sometimes even a whole store is dedicated, called a single vendor store.

пÑ"? Furniture manufacturers spend on average 3.5% of annual net sales for advertising (consumer, trade, and cooperative).

пÑ"? A major form of