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Rug sales predicted to grow more than 12% in next 5 years

Home Accents Industry News

By Daphne Garland-McLean -- Home Accents Today, 1/1/2009

Though news on the economic front continues to be dreary, area rug sales are expected to increase by 12.6% over the next five years. According to estimates made by New York-based Easy Analytic Software Inc., area rug sales are projected to grow from $5 billion in 2008 to $5.6 billion in 2013.

Regionally, over the next five years, the West and the South will have the greatest sales growth if EASI's sales projections hold true.

Statisticians at EASI expect area rug sales growth in the West to increase by 15.4% and in the South to increase by 14.8%. A slower growth pattern is expected in the Midwest and Northeast with forecasted growth expected at 9.8% for the Midwest and 8.5% for the Northeast.

Looking at the states, 20 states in the U.S. are expected to exceed the national average in area rug sales growth by the year 2013.

Of those 20, 12 states are in the West and eight states are in the South. No states in the Northeast or Midwest are expected to exceed the national average in sales growth for area rugs. However at growth rates of 12.2% and 11.7%, respectively, New Hampshire in the Northeast and Minnesota in the Midwest are expected to be extremely close to the national average.

Four of the five states expected to experience the fastest sales growth are in the West. Nevada tops their ranks with an expected growth of 25%. Arizona is a near second, expected to increase sales by 23.6%. Slightly lower, Utah is expected to grow by 19.2% and Idaho by 18.7%. In the South, Georgia with a projected increase of 18.1% rounds out the top five among states in area rug sales growth.

Among all metros, Palm Coast, Fla., tops the chart in area rug sales with an expected sales growth of 43.5% over the next five years. According to EASI projections, Fernley, Nev., will increase in area rug sales by 35.9%. St. George, Utah, and The Villages, Fla., can both expect significant sales growth, with an EASI forecast of 34% and 33.7%, respectively. By 2013, Pahrump, Nev., is also on track for exceptional growth with an anticipated 30.8% increase in area rug sales.

If EASI projections remain intact, three of the ten biggest markets will exceed 20% in sales growth in area rugs. The Atlanta-Sandy Springs-Marietta, Ga., market can anticipate a sales increase from $81.8 million in 2008 to $100 million in 2013. That's a 22.1% change over the next five years.

Close behind are the Dallas-Fort Worth-Arlington, Texas, and Houston-Sugar Land-Baytown, Texas, metros at 21.4% and 20.5% respectively.

2008 estimated 2013 projected percent change
U.S. $5.02 $5.65 12.6%
Northeast $0.96 $1.05 8.5%
Midwest $1.13 $1.24 9.8%
South $1.83 $2.10 14.8%
West $1.10 $1.26 15.4%
Source: Easy Analytic Software, Inc. and Home Accents Today market research

While the Greater Washington-Arlington-Alexandria area is not expected to exceed 20% in sales growth over the next five years, this area will exceed the national average with a projected increase of 13.9%. The New York-Northern New Jersey, Long Island, N.Y.-N.J.-Pa. metro is expected to experience the slowest growth, increasing only 8% from $317.6 million in 2008 to $343.4 million in 2013. Still, this metro accounts for a big chunk of area rug sales dollars.

For a complete listing of top metro areas by region, as well as a forecast for each state, visit HomeAccentsToday.com.

 

Behind the numbers

Home Accents Today market research worked with Easy Analytic Software Inc. to develop sales estimates and projections for area rugs, lamps, top-of-bed, and wall decor sales. Sales and estimates for wall decor and lamps will be in the February and March issues, respectively.

2008 sales estimates for each product category are based on data available through August 2008 and are subject to revision as additional data become available. Estimates are based on information from the Department of Commerce, the International Trade Commission, sales estimates from manufacturers and retailers, Home Accents Today's Consumer Buying Trends Surveys, Home Accents Today and HGTV's Consumer Views Survey, Furniture/Today's Consumer Buying Trends Surveys and Furniture Store Performance Report as well as discussions with industry executives and analysts.

Segment figures were aggregated by Home Accents Today and statisticians at EASI. EASI matched demographic data (such as age and income) gathered by Home Accents Today against other data sources such as the Bureau of the Census, the Department of Justice, the National Center for Education Statistics and the Department of Labor. EASI then uses a series of statistical models to develop estimates by metro markets.

EASI's highly accurate models are regression curves based upon a variety of factors designed to forecast changes that include growth and the interrelationship of variables. Projections for 2013 are designed to forecast the changes that statistically adjust for household income, age by race and sex, group quarter population and births and deaths, along with other forecasting factors. Spending forecasts assume a national rate of inflation that does not vary from one location to another. Other economic factors, such as unemployment rates, interest rate changes, etc., are not part of the forecast numbers.

Data are given for Core-Based Statistical Areas (CBSA), defined as a geographic entity consisting of the county or counties containing one or more cores (urbanized areas or settlement clusters or both) that together have at least 10,000 population, plus adjacent counties having a high degree of social and economic integration with the core(s) measured through commuting patterns.

Within this broad definition, large metros, called Metropolitan Statistical Areas, have at least one urbanized area of 50,000 or more population. Small metros, called Micropolitan Statistical Areas, have at least one urban cluster with a population of at least 10,000, but less than 50,000. Both designations include adjacent territory that has a high degree of social and economic integration with the core measured by commuting ties. The designations are mandated by the Office of Management and Budget and are used by government agencies for statistical reporting purposes.

Additional reports available

Sales estimations and projections for individual product categories are available in a series of Product Potential Reports.

Each Product Potential Report gives estimated 2008 sales and projected 2013 sales figures for each specific product for 939 metropolitan areas. Each report also provides state-level data for the product. Home accents products covered in separate reports are area rugs, lamps, top-of-bed and wall decor. In addition, reports are available for specific furniture products including master bedroom, youth and other adult bedroom furniture, casual dining, dining room furniture, entertainment furniture, curios, occasional tables, desks, other home office furniture, stationary sofas/sofa-sleepers, stationary chairs, reclining chairs, swivel/glider rockers and motion sofas. A full list of product categories available is on Home Accents Today's Research Store, available on our Web site.

Market Potential Reports on each of the nation's 939 metropolitan areas are also available. Each gives sales estimates and projections for sales of each of the product categories in a given market, plus additional estimates and projections of pertinent market data such as population, household sizes, number of households by age and income.

Both Product Potential Reports and Market Potential Reports may be ordered online at www.homeaccentstoday.com (through the Research button) and will be available mid-February.

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