The production of contract furniture and furnishings in Europe was worth around Eur 9,8 billion in 2017 according to CSIL estimates. The main manufacturing countries are Italy, Germany, the United Kingdom and Sweden, which together provide 65% of total European output. The sector is opened to international markets as over 20% of the total output is destined for projects in the Middle East, Asia, America, Central-Eastern Europe, Russia and North Africa. During recent years, extraEuropean exports have played an important role for the local industry. As a consequence of the economic stagnation following the financial crisis, the domestic demand for contract furniture was negative in 2012 and 2013, whereas production continued growing. The business stemming from the more dynamic areas of the world was crucial in achieving the 3% annual average growth in production between 2009 and 2017.
TURN-KEY PROJECTS ARE CRUCIAL
There are two main business approaches for companies operating in this sector. Large specialist players usually provide complete STUDIES by Mauro Spinelli CSIL International Market Research 'turn-key' solutions, providing the client with a totally finished project, using predominantly customised production, but also including the products of other firms. The largest part of the contract supply is 'turnkey' based. A minor portion is claimed by the so-called 'soft contract', where the manufacturers supply contract furniture and furnishings, but do not manage the project directly and generally offer only standard product collections. As a general trend the 'turn-key' part increased significantly over the last years. Companies in the sector are concentrating, becoming bigger and more organized. Today the combined market share of the top 20 players stands at 40%, meaning four percentage points more than in 2012.
HOSPITALITY STILL THE MAIN ENGINE IN EUROPE
The largest segments of the contract market are Retail – including both mass-market retail and the luxury shops segment – followed by Hospitality and Office. With an increasing presence of international tourists, the Hospitality industry in Europe continues to be the main engine of the contract furniture and furnishing sector. According to the STR Pipeline Report 2017, the number of hotel rooms under contract increased by 18% in 2016. Reportedly, Europe accounted for 77,263 rooms in 471 projects under construction for that year. Looking at the number of rooms, this is a 24% increase year-on-year. On the other side, the Retail sector showed some signs of uncertainty. Observers stated that all of Europe is experiencing a reduction in physical footprints. Although we must observe a lack of official statistics, we should consider that online sales are growing at a rate five times higher than that of physical stores. Fewer in-store sales may affect new retail construction projects and renovations. Contract markets that depend to a greater extent on demand from the public sector, in areas such as Education and Healthcare, are still sluggish. The Government expenditure, which has shrunk considerably in many countries during recent years, is experiencing some improvement. However, the effects of the austerity measures adopted are still evident. Eurostat data on available beds in hospitals in Europe show that governments' offers of places in public healthcare institutions have reduced over the last few years. The slowdown has been observed for the majority of European countries as bed places decreased from about 2.0 million to 1.9 million.
THE REFURBISHMENT OF AN ICONIC HOTEL
Space Copenhagen has re-introduced original features and furniture as part of a comprehensive refurbishment of Arne Jacobsen's iconic Radisson Blu Royal Hotel, which is nearing completion in the Danish capital. The project involves the renovation of 259 guest rooms and suites, the lobby and meeting rooms, as well as the introduction of a new restaurant at the hotel, which originally opened in 1960. The building designed by the Danish architect and designer Arne Jacobsen for the airline Scandinavian Airlines System (SAS) was Copenhagen's first skyscraper, and is one of the most familiar and celebrated examples of Danish modernist architecture. Space Copenhagen worked with the manufacturer of the furniture, Danish brand Fritz Hansen, to update the pieces using fabric from Kvadrat's range with the designer Raf Simons, and combined these classic designs with a new mirror and chair it created for another Danish firm called '&Tradition'.
The seventh edition of the CSIL report 'The Contract Furniture and Furnishings Market in Europe' provides a comprehensive picture of the European contract furniture market with a focus on 17 countries (Austria, Belgium-Luxembourg, Denmark, Finland, France, Germany, Greece, Ireland, Italy, the Netherlands, Norway, Portugal, Spain, Sweden, Switzerland, the United Kingdom). The European contract furniture market is broken down by destination segment: Retail (Mass market and Luxury shops), Hospitality, Office spaces, Restaurants and bars, Real estate, Education, Entertainment, Marine, Healthcare, Airports. Analysis of the competition is also included with sales breakdown by segment, financials and company profiles. The CSIL Report is available for online purchase and download at: www.worldfurnitureonline.com