Insight:
- The Vietnamese home furniture market is projected to experience significant growth, driven by factors such as urbanization, rising incomes, and evolving consumer preferences.
- While facing challenges like competition and inconsistent quality, the market presents opportunities for businesses that capitalize on eCommerce, customization, and sustainable practices.
A look at Vietnam’s home furniture market
Mordor Intelligence anticipates Vietnam’s furniture market growth to surpass 1.47 billion USD in 2024 and reach 1.92 billion USD by 2029, enjoying a relatively steady annual pace of development at 5.33%. Statista highlights the living room furniture market domination, with a projected value of 462.90 million USD in 2024.
The home furniture segment promises to go even higher, estimated to jump from 390.99 million USD in 2024 to 626.26 million USD in 2029, while remaining with a great annual growth rate of 9.87%.
eCommerce has dramatically transformed how Vietnamese customers buy needed products, including furniture. Today’s online platforms offer various furniture products with attractive prices and delivery convenience.
The number of customers purchasing furniture via the internet has steadily increased, keeping in line with the continual increase in internet and smartphone usage. To fulfill this quickly growing demand, furniture retailers in Vietnam have started developing actualities by investing in their online presence and venturing into eCommerce platforms.
Vietnam has been recognized as a friendly wood manufacturing destination. Over 120 countries worldwide import wood from Vietnam, including markets such as the US, UK, Canada, Australia, and Japan, among others.
The internal and external furniture market in Vietnam has seen an upward trend, and it does not appear to stop there. So the Vietnam furniture market keeps flourishing and has various products to fit different tastes, needs, and demands.
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Great potential for future development
Recently, the Vietnam Furniture Association has officially become a member of the Asia-Pacific Interior Design Association, laying a solid foundation for long-term cooperation between the two organizations. With a clear roadmap and strong support from its regional counterparts and the Asia-Pacific Interior Design Association, the Vietnam Furniture Association aims to standardize and improve the industry’s quality to become a fully integrated, comprehensive, flexible, and efficient international industry.
According to wood industry associations, Vietnam’s average annual furniture consumption is over 20 USD per person. However, domestic businesses face stiff competition from local rivals and foreign companies, especially those from China, Thailand, and Malaysia, which often have advantages in terms of price, design, quality, and service.
Several factors propel the Vietnamese furniture market, such as rapid urbanization and the emerging middle class. This portrays an increasing demand for home furniture as people have started spending much on home decoration.
These are major driving forces of the economy in growth stages and urbanization. In addition, the prosperous rise of disposable incomes of the middle class provisioned savings for creating a habitable environment. Urban development has further triggered a craving for new homes and furniture.
Developments in eCommerce portals and e-business applications are another key factor driving market growth. eCommerce has created new avenues for the furniture industry, with consumers easily accessible to a much wider choice of furniture products on eCommerce platforms, thus driving demand.
Vietnamese home furniture market trends
The Vietnamese home furniture market is continuously evolving and developing in line with new trends. These changes reflect economic and social development and shifts in consumer preferences. This article will highlight some of the most prominent trends in the Vietnamese home furniture industry.
A popular trend today is minimalist living in an age of rapidly dwindling space. Space-saving and convenient, multifunctional furniture combines in one applied space-saving and practical utility indoor furniture.
The most important trend regarding environmentalism has led to furniture made of natural materials, including wood, rattan, and linen. These have been identifiable as products “friendly” to the environment and those providing rustic and natural echoes.
The speed of technology is setting unchartered ground for possible intelligent furniture voice control, light sensors, and incorporation with other instruments. Nordic design line comprises simple lines, neutral colors, and natural materials and is emerging in Vietnam. The style has a warm and tranquil effect on many living spaces.
Though modern looks continue to be popular, retro is hot once again. Vintage-inspired furniture wears a nostalgic face with a more intimate face, making it important for those who want their homes to look different. More and more people are interested in custom-designed furniture solutions. There is a growing demand for custom designs catering to individual preferences.
The Vietnamese home furniture market is very active and constantly changing. Therefore, to timely follow the trends, furniture businesses can introduce products that meet the demand and keep pace with the changes.
Challenges and opportunities for the Vietnamese home furniture market
Challenges in the future market
The Vietnamese home furniture market is experiencing robust growth but faces significant challenges. Some key challenges include:
- Intense competition: Imported furniture, especially from China, holds a significant advantage in price and diverse designs, putting immense pressure on domestic businesses. The abundance of small-scale furniture businesses competing on price makes it difficult to build strong brands and improve product quality.
- Inconsistent product quality: The inconsistent product quality that results from unstandardized quality control will mean a great range between the qualities of many products; hence, from top-end products to lower-end products, consumers will not be able to make informed decisions. The dwindling supply and rising cost of natural wood have compelled many companies to resort to manufactured wood, affecting product quality and durability.
- Distribution Channels: Most furniture businesses still rely on a third distributor for sourcing their products, which hampers quality control and price control on their items. Though eCommerce has evolved rapidly, online selling of furniture products still has limitations in shipping, installation, and customer experience.
- Human resources: Human resources related to the furniture market are deprived of high-quality human resources in the preparation of designing, engineering, and skilled craftspeople. The training of human resources has had limited development in furniture, which has led to the inconsistency of product quality.
- Marketing and branding: Many furniture businesses have invested little in marketing, leading to limited brand awareness. Building a strong furniture brand requires significant time and resources.
- Impact of the pandemic: The outbreak of COVID-19 has brought abrupt disruption in the raw materials supply chain, leading to the production and business operations being affected in the furniture industry. There are increased consumer expectations of green and healthy products, thus forcing businesses to innovate their product and service offerings.
Market opportunities in the future
The Vietnamese home furniture market is brimming with exciting opportunities, especially given the country’s rapid economic growth and urbanization. Some key opportunities:
- Economic growth and urbanization: Population and increasing urbanization spur huge demand for new housing. In turn, house demand fuels furniture demand. As living standards are gaining, consumers are investing money into better, varied-quality furniture.
- Changing consumer trends: Consumers increasingly focus on quality of life and seek sustainable, eco-friendly, and aesthetically pleasing furniture.
- Customization: Customers are looking for furniture that is tailored to their individual style and preferences.
- eCommerce boom: eCommerce opens up new sales channels, allowing businesses to reach a wider customer base. eCommerce is particularly popular among younger consumers who prefer online shopping.
- Rise of the middle class: The growing middle class creates a significant demand for high-end, uniquely designed furniture. Their higher disposable income makes them willing to invest in home decor and furnishings.
- Export opportunities: Vietnam’s competitive labor costs and abundant resources make it well-positioned to export furniture to markets like the US and Europe. Free trade agreements are further facilitating furniture exports.
- The green movement: Consumers are increasingly interested in furniture made from natural materials and with a minimal environmental impact. Smart and energy-efficient furniture is also gaining popularity.
- Tourism industry: The growth of the tourism industry has stimulated a massively increasing demand for furniture in hotels, restaurants, and resorts. Hence, furniture manufacturers may alliance with various tourism bodies and create all-inclusive designs for interior furnishings.
In short, the home furniture market in Vietnam is rich with opportunities and would benefit any businesses that capitalize on the trends and adopt evolving consumers.
Conclusion
The growth of the Vietnamese furniture market is driven by all these factors and, in particular, by urbanization and economic expansion, changes in consumer preferences, and, of course, increasing expansion in eCommerce demand and new applications. There’s potential to grow extremely high. This trend offers increased interest from not just domestic markets but the international market, too. The Vietnamese furniture industry could continue with increased and strong development in the coming years.
