Wood Household Furniture, Except Upholstered

SIC 2511

Companies in this industry

Industry report:

This classification consists of establishments engaged in manufacturing wood furniture commonly used in dwellings, with the exception of television, radio, phonograph, and sewing machine cabinets, which are classified in SIC 2517: Wood Television, Radio, Phonograph, and Sewing Machine Cabinets; also, millwork production is classified in SIC 2431: Millwork; and wood kitchen cabinets are classified in SIC 2434: Wood Kitchen Cabinets. Cut stone and concrete furniture is classified in the major group for stone, clay, glass, and concrete products; laboratory and hospital furniture, except hospital beds, is in the major group for measuring, analyzing, and controlling instruments. Photographic, medical, and optical goods; watches and clocks; and beauty and barber-shop furniture is classified in the major group for miscellaneous manufacturing industries. Finally, those engaged in woodworking to individual order or in the nature of reconditioning and repair are classified in non-manufacturing industries.

The nonupholstered wood furniture market has four segments: master bedroom, youth/second bedroom, casual dining, and formal dining. Master bedroom is the largest wood segment and the third largest among all furniture, after sofas and mattresses. The youth/second bedroom segment includes pieces for children, such as cribs and changing stations, along with furniture for spare bedrooms. The line between the remaining two segments, casual and formal dining, grows increasingly blurred, as lifestyle changes spur greater numbers of consumers to opt for casual dining sets over more formal units. According to Furniture Today, in 2008 Americans spent $8.3 billion on master bedroom furniture, $4.6 billion on youth/second bedroom pieces, $3.6 billion on casual dining furniture, $5.5 on formal dining room furniture.

Aside from the master bedroom, a trend toward smaller pieces was sweeping the wood furniture market in the late 2000s. Compact dressers and bed frames were considered more suitable for spare bedrooms. Likewise, smaller dining room tables offered flexibility for owners of modest homes, as well as people living in college dorms or assisted-living facilities.

While consumers in the past may have viewed furniture as a long-term investment to be passed down from generation to generation, consumers in the twenty-first century considered most furniture disposable. They tended to select pieces based on appearance, perceived quality, and, above all, price. The emphasis on value slashed the profit margin of most U.S. furniture manufacturers. As a result, fewer producers had the ability to invest in up-to-date technology and equipment, and more revenue was lost to overseas competitors with lower labor and production costs. Between 1997 and 2005, according to Wood Digest, even though U.S. demand for wood furniture grew 27 percent, employment in this sector plummeted 36 percent in the United States.

According to Dun and Bradstreet's 2009 Industry Reports, 4,149 establishments employed 68,699 people in the wood household furniture manufacturing industry in the late 2000s. California had the most businesses in the industry, with 489, and employed 7,927 workers, second only to North Carolina, which employed 12,662 people in this category. Other significant states in terms of employment were Virginia, Wisconsin, New York, and Indiana. In 2008 Missouri, which was 19th on the list of industry employment, accounted for $1.7 billion in sales --almost 20 percent's of the nation's total revenues of $8.6 billion in 2008. Indiana was second, with $1.5 billion in sales, followed by Virginia with $1.1 billion, Connecticut with $1.0 billion, and California with $700 million.

Unfortunately for U.S. manufacturers, the source of many household furniture products was foreign, not domestic. Wood Digest reported that between 1992 and 2005, imports of furniture skyrocketed from $4.1 billion to $23.6 billion. During this period, China realized a 50-fold increase in its share of those imports. In the wood furniture segment alone, Chinese imports jumped 525 percent between 1998 and 2005. In the first nine months of 2006, Wood & Wood Products stated that the United States imported more than $6.7 billion in wood and upholstered furniture from China, accounting for nearly half of all furniture imports. Even though domestic furniture exports edged up by 2.3 percent during those nine months, the U.S. furniture trade deficit was $12.5 billion. Furniture Today reported that by the second quarter of 2009, imports represented almost 70 percent of all household wood furniture sold in the United States.

The meteoric rise of Chinese manufacturers in the U.S. furniture market, specifically the wood furniture market, was viewed suspiciously by domestic producers. In October 2003, the American Furniture Manufacturers Committee for Legal Trade, a group representing approximately two dozen furniture manufacturers, filed a petition with the U.S. government regarding the trade practices of Chinese exporters. The group alleged that Chinese-made wood bedroom furniture was being "dumped" in the United States--that is, sold below cost in order to trounce competition.

The U.S. Department of Commerce ruled that Chinese manufacturers were, in fact, illegally dumping in the U.S. wood bedroom furniture market, and in June 2004 set a blended duty rate of 6.65 percent for most Chinese companies. A portion of the duties collected were to be dispersed to "affected domestic partners." In late 2006, the government distributed $21.8 million to petitioners. Among the 23 recipients were Stanley Furniture, which received the largest share ($5.37 million); Vaughan-Basset Furniture, which collected $3.84 million; and Bassett Furniture, which received $1.54 million. In mid-2007, the government collected an additional $156.6 million, which was distributed to various furniture makers.

Industry leaders in the household furniture industry in the late 2000s included Ashley Furniture Industries Inc. (Arcadia, Wisconsin), with $3.4 billion in sales in 2008 and 17,000 employees; Furniture Brands International Inc. (St. Louis, Missouri), which had sales of $1.7 billion in 2008 and 8,100 employees; La-Z-Boy Inc. (Monroe, Michigan), with 2009 sales of $1.2 billion and 7,730 employees; and Ethan Allen Interiors Inc. (Danbury, Connecticut), which reported 2009 sales of $674.3 million with 4,300 employees.

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