Fastest growing metros and their buying power

Home Accents Today market research worked with Easy Analytic Software Inc. to develop sales estimates and projections for U.S. sales of area rugs, lamps, decorative pillows and wall decor. The 2005 sales estimates for each product category were developed by Home Accents Today market research based on data available through November 2005 and are subject to revision as additional data become available. Current estimates are based on information from the Department of Commerce, the International Trade Commission, sales estimates from manufacturers and retailers, Home Accent Today's Consumer Buying Trends Survey and discussions with industry executives and analysts.

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

EASI's highly accurate models are regression curves based on a variety of factors designed to forecast changes that include growth and the interrelationship of variables. EASI's projections for 2010 are designed to forecast changes that statistically adjust for household income, age by race and sex, births and deaths among numerous other updating and forecasting factors. Spending forecasts assume a national rate of inflation that does not vary from one location to another.

Data are given for Core-Based Statistical Areas. Within this broad definition, large metros, called Metropolitan Statistical Areas, have at least one urbanized area of 50,000 or more people. 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. The metro areas in the Home Accents Today report are all large metros.

Home Accents Today's sister publication, Furniture/Today, along with EASI also has prepared sales estimates and projections for a series of furniture product categories in a series of Product Potential Reports.

Each Product Potential Report gives estimated 2005 sales, projected 2010 sales, with the percentage change for a specific product for more than 900 metropolitan areas. Each one also has state-level data for the product. Product Potential Reports may be ordered online at furnituretoday.com. Among the product categories available are:

Curios

Cocktail, end, coffee, sofa tables

Stationary chairs

Porch, patio, pool, outdoor furniture

Area rugs

Lamps

Wall decor

Decorative pillows

Also available are Metro Potential reports that give the spending estimated in 2005 for each of the product categories listed above for the metro, along with projected spending in 2010. Armed with this information, retailers can calculate their own share of market in their trading area. In addition to home furnishings spending estimates, Market Potential Reports also give demographic information on the metro area, including breakdowns by age, income and ethnicity, showing how these are projected to change over time.

By 2010, Residents in the profiled metros in the Northeast will have the highest median income of all cities we profiled, $71,386. However, of the four regions of the country, their projected sales of the four major home accent categories show the smallest increase. Area rug sales will grow 28.2%, wall decor 22.1%, lamps 20.7% and decorative pillows 16.9%.

The metros in this region showing sales increases for home accents include Atlantic City, N.J.; Dover, Del.; State College and York/Hanover, Pa.; and Ithaca and Poughkeepsie/Newburgh/Middletown, N.Y. The biggest sales increase will be a 37% spike in area rug sales in Dover.

Delaware's capital Dover is one of the fastest growing cities in the state due to its low cost of living and high quality of life. State government is the major employer, as are the Dover Air Force Base and two divisions of Playtex. Consumers here will spend $3.4 million each on area rugs and wall decor, $4.4 million on lamps and $4.3 million on bedroom linens in the next five years.

The Poughkeepsie/Newburgh/Middleton, N.Y., metro is home to one of the Seven Sisters, Vassar College, along with a large IBM campus, West Point Academy and the Culinary Institute of America. Manufacturers here produce transportation equipment, scientific instruments, apparel and plastic and metal products. Residents here have the highest median income of the profiled cities, $71,386, with 47% of them earning $75,000 or more. They will spend $21.5 million on bedroom linens, $20.4 million on area rugs, $21.5 million on lamps and $17.8 million on wall decor in 2010.

York/Hanover, Pa., has a rich history. Located five miles north of the Mason-Dixon Line, Hanover is considered a snack food capital and boasts brands like Utz Potato Chips and Snyder's of Hanover. York was the first capital of the country, the birthplace of the Articles of Confederation and the first place the words the United States of America were spoken. Residents here will spend $13.1 million on lamps and on bedroom linens, $10.6 million on area rugs and $10.4 on wall decor.

Ithaca, N.Y., consumers will spend $3.5 million on lamps, $3 million on area rugs, $3.4 million on bedroom linens and $2.8 million on wall decor in 2010. This area is home to Cornell University and the economy primarily is based on manufacturing and education, though high-tech and tourism of the Finger Lake area wineries also play a role.

Greeley, Colo., Las Vegas/Paradise, Nev.; Riverside/San Bernardino/Ontario, Calif.; St. George, Utah, and Stockton, Calif., are the five metros in the West projected to have the largest increase in sales in area rugs, lamps, decorative pillows and wall decor over the next four years.

The median age in 2010 will be about 31 to 35 and median household incomes will range from $51,268 to $60,968. Surprisingly, of the four regions, this one has the lowest income range but has the highest projected growth across all categories. Over the next four years, sales for area rugs are expected to increase by 35.4%, wall decor by 28.4%, lamps by 26.9% and decorative pillows by 23%.

The Riverside/San Bernardino/Ontario metro area alone is expected to spend $114.6 million on lamps, $95.4 million on area rugs, $89.7 million on wall decor and $16.2 million on decorative pillows and throws. Other hot categories in this area include bedroom linens and bathroom linens.

This area is one of the closest to Los Angeles County that still has undeveloped land. It has produced oranges (there's a Sunkist plant in Ontario), peaches, walnuts, lemons and grapes, though now the economy reflects an industrial and manufacturing base with major employers like UPS, Verizon, Toyota, Hewlett Packard and Mag Instrument. Ontario also is renowned for its float in the annual New Year's Day Tournament of Roses Parade and San Bernardino is the site of the first McDonald's.

Remember the phrase "Go West, young man!"? Greeley, Colo., is named after New York Tribune editor Horace Greeley, who gave that directive to his agricultural editor, Nathan Meeker. Meeker took his advice and spearheaded a drive to form a Utopian community northeast of Denver. Greeley is in Weld County, one of the top five counties in the nation for the amount of agricultural products sold; it's No. 1 in livestock, lamb and poultry.

By 2010, Greeley residents are expected to spend $6 million on area rugs, up 51% from 2005, $5.8 million on wall decor and $7.4 million on lamps.