Category analysis: Office furniture

OPI takes a look at the global office furniture sector. Expect further M&A activity and an increase in greener, more flexible product ranges in the years ahead.


Recent corporate updates from some of the world’s major office furniture manufacturers suggest a number of clear trends are appearing in this particular segment of the OP industry.

Market consolidation, sluggish sales in Europe and an increasing reliance on emerging markets, such as China and India, summarises much of the sector’s latest activity, while eco-friendliness and product flexibility continue to be the key concerns in the manufacturing process.

So who’s doing what? US vendor Steelcase has announced plans to open a production facility in India, while HON brand owner HNI entered the same market in August with the acquisition of Mumbai-based office furniture company BP Ergo. 

One company looking at the fabled BRIC (Brazil, Russia, India and China) axis of emerging economic powerhouses is Taiwanese office machines and furniture manufacturer Aurora. The vendor is looking to the Chinese domestic market to fuel profit growth, and China now represents a quarter of its total sales.

Strategic tie-ups aren’t restricted to new territories though, with plenty of scope for the industry to improve business opportunities in local markets. US-based office furniture manufacturer Haworth recently acquired what was described as a “strategic interest” in Boston firm Affordable Interior, giving its dealers more presence in the SMB channel. Meanwhile OP and office furniture vendor MooreCo is currently in acquisition mode, according to CEO Greg Moore. Without giving too much away about his company’s plans, he explains that “difficult economies always provide consolidation opportunities”

“With worldwide furniture revenue over $400 billion and added financial crises and associated turmoil in the capital markets, it has created extraordinary opportunities for mergers and acquisitions (M&A),” he argues.

“The BRIC countries are performing well, as are Indonesia, Philippines, Turkey, Chile and Thailand.”

While manufacturers scan the globe for new opportunities, the European OP market has been significantly impacted by the economic troubles in the eurozone. Steelcase’s first-quarter EMEA sales fell by 11%, for example, which was more than the company had been expecting. The Spanish market, and perhaps more surprisingly the more stable German market, experienced the greatest declines. As OPI went to press, the vendor reported improved Q2 sales. 

Michael Matsson, International Sales Manager at Plastunion-owned Onside-Sweden, which supplies plastic components such as drawers for major furniture producers, agrees that the European market is slowing down “rapidly”, although his business has still performed well in difficult conditions.

“There will be a reduced number of smaller non-brand office manufacturers,” he notes. “Also, the fact that many office manufacturers put all production outside of their house means there will be a growth on some of the large production sites in low-cost countries such as the Baltics and Romania.”

Matsson says sales for the 12 months to 31 June this year were up 16% compared to the previous year, but the outlook for 2013 “looks dimmer” with the possibility of flat sales this financial year. 

“Office furniture takes a long time to react to a downturn of the economy, but is also quick to react in an upturn,” he adds.

Flexible furniture

The evolution to a more mobile workforce and growing numbers of small office/home office workers (SOHO) are not new phenomenons, but these trends continue to dictate the way OP items are made. Flexibility is the buzzword in office furniture, with numerous manufacturers emphasising the importance of developing adaptable products to meet the many requirements of the modern office, whether it is to cater for technological advancements or to follow ergonomic standards.

Nat Porter, General Manager of Safco, which recently won a North American Office Products Award, agrees that the SOHO market’s continued rapid growth partly dictates the company’s new product development strategy.

“More and more companies are allowing their employees to work remotely, either from home or satellite offices, which is expanding the market,” he explains.

“These workers are looking for furniture that can perform multiple tasks within their space, and also fit into their existing décor. Furniture that can be used to convert any small nook into a usable workspace is the perfect solution for this market.”

Not too long ago meetings were typically formal affairs conducted on huge wooden tables behind closed doors. Although these still take place in some traditional organisations, the on-the-go catch-up is now just as popular a way to keep staff informed and plan new strategies, inevitably creating a need for different furniture styles.

“We have been seeing a lot of success in products that can be used in transitional spaces such as conference centres, training rooms and meeting areas,” Porter adds. “These spaces need seating, tables, privacy and other products that can easily and quickly be reconfigured depending upon what it is being used for. The agility of today’s workspace continues to demand products that are more flexible, mobile and meet multiple needs across a space.”

It is clear that the emergence of SOHO and the mobile workforce has given resellers new categories to target in recent years, and perhaps chair mats could be on the rise. According to Edward Wittbold, Director of Marketing at Alabama-based manufacturer ES Robbins, the chair mat category is “growing in all areas” at his business. It has reportedly experienced improved chair mat sales through each of the independent, contract/commercial, superstore and e-commerce channels.

Says Wittbold: “Demand for chair mats reflects some of the trends in the flooring market. As household and business demand for hard floor surfaces such as wood, tile and laminate increases, there is a long-term shift in mix. Mats for hard floor now account for more than 30% of chair mat sales.”

Amid the product development going on at the company’s Muscle Shoals headquarters, Wittbold says that ES Robbins is continually working on goods that provide better performance and are safe. Work is underway on “an ergonomically superior chair mat” that will be marketed as reducing stress and strain on the back, and the vendor says it always aims for its products to have “the smallest environmental impact possible”.  

Natural origins

ES Robbins’ latest innovation is the Natural Origins product line. This range is based on the proprietary GEN7V biopolymer, which is a high-performance resin partially derived from plant-based renewable resources. 

Items in the Natural Origins range are the first flooring and desk protection products designed specifically for business, office, and home use to be certified by the US Department of Agriculture (USDA) as “bio-based”, according to Marketing Director Ed Wittbold. “The USDA BioPreferred programme mandates and defines standards for federal government procurement programmes as outlined in the President of the United States’ Federal Leadership in Environmental, Energy and Economic Performance Executive Order 13514 for environmental stewardship.”

Onside-Sweden’s Michael Matsson acknowledges that environmental thinking and certificates will become increasingly important, while MooreCo’s CEO Greg Moore notes that efforts to improve indoor air quality and produce more ecological materials and ergonomics are “necessities in the current market”. These vendors and the wider manufacturing community are therefore making appropriate efforts to meet such goals and tailor product design accordingly.

Future generations of purchasing decision makers from both a consumer and business perspective, who have grown up in an environment where green is the norm, will expect nothing less.