Furniture Retailing - Italy - July 2008

SUMMARY

Abstract

This report series covers the five leading economies of Western Europe. The furniture sector is a difficult one to analyse, mainly due to the fact that even these large economies still have very fragmented markets. Smaller specialist players still have an important role to play and make up more than 50% of the furniture sector in the markets we have covered. Furniture is a difficult sector in which to build up significant economies of scale (without going down the IKEA flat pack route), a fact that has protected the independents. However, the arrival of non-specialists and the impact of the successful chains is sure to lead to a greater degree of consolidation in the future.

We have provided profiles of the largest furniture chains in Europe. Smaller profiles have also been provided on other significant players involved in these five markets.

The subject of this report is furniture retailing, however due to the increasing convergence of furniture with other complementary sectors such as electricals and DIY, there are very few large players that now focus on the provision of furniture alone. We have provided information on players that achieve the majority of their turnover from the sale of furniture, so mixed goods retailers such as the grocers or department stores are referred to but no firm coverage is provided of them.

While our spending figures refer to all spending on furniture, retail sales figures are more difficult to separate. In France for example, the retail sales figure for furniture retailers' sales is actually higher than consumer spending in the sector. This can be attributed to the aforementioned sector blending that is seeing more and more furniture specialists expanding their offer into related fields.

The furniture sector is facing major challenges:

• Softer housing market in many countries is reducing the desire to invest in the home and add value.
• Economic issues are undermining consumer confidence leading to greater reluctance regarding the purchase of big-ticket furniture items.
• Specialists are facing greater competition from department stores, grocers and even some clothing retailers.

TABLE OF CONTENTS

Table of Contents

• Market in Brief
• The future
• Market size and performance
• The competitive landscape
• Report Scope
• Technical notes
• Financial definitions
• Currencies
• VAT
  • Figure 1: Europe: Standard VAT rates, 2007/08
• Other abbreviations
• Broader Market Environment
• Positive factors
• Negative factors
• Population -- growing but greying
  • Figure 2: Italy: Population trends, 2002-06
  • Figure 3: Italy: Population by age, 2007
• Households getting smaller -- slowly
  • Figure 4: Italy: Proportion of households by number of members, 1998 and 2000-03
• Economy
• GDP -- a short-lived upswing
  • Figure 5: Italy: GDP, 1996-2007
• Subdued outlook for consumer spending
  • Figure 6: Italy: Consumer spending, 1996-2007
• Inflation on the up
  • Figure 7: Italy: Consumer price inflation, 2000-07
• The Market in Context
• Key findings
• Weak furniture driven by rising prices
  • Figure 8: Italy: Consumer expenditure on furniture, 2003-07
• Channels of Distribution
• Sector Size and Forecast
• Key findings
• Economic outlook
• Retailers' prospects
  • Figure 9: Italy: Retail sales, 2003-12
• Recent trends in Italian furniture retail
• Enterprise data
  • Figure 10: Italy: Furniture retailers, enterprise numbers, 2001-05
• Retail Competitor Analysis
• Key findings
• Leading players
• IKEA continues to steam ahead
• Mercatone Uno expands with new banners
• Conforama struggling
• Mondo Convenienza -- a rising star?
• Smaller players have ambitious plans
  • Figure 11: Italy: Leading players in the furniture sector, 2007
• Market shares and evaluation
  • Figure 12: Italy: Leading furniture specialists' market shares, 2007
• Conforama (PPR)
  • Figure 13: Conforama: Sales as share of furniture retailers' sales in Europe, 2003-07
• Strategic evaluation
• Background
• Financial performance
  • Figure 14: Conforama: Group financial performance, 2003-07
  • Figure 15: Conforama: Breakdown of sales by geographical area, 2003-07
• France
  • Figure 16: Conforama France: Share of spending on furniture, 2003-07
  • Figure 17: Conforama France: Share of spending on electricals goods, 2003-07
• Italy
  • Figure 18: Conforama: Sales as share of furniture and home appliance retailers' sales in Italy, 2003-07
• Competitive environment
• Store portfolio
  • Figure 19: Conforama: Outlet data, 2003-07
  • Figure 20: Conforama: Outlet data, 2003-07
  • Figure 21: Conforama: Sales area, 2003-07
• Retail offering
  • Figure 22: Conforama: Breakdown of revenue by product category, 2003-07
• E-commerce
• Ikea
  • Figure 23: IKEA Europe: Sales as share of furniture retailers' sales in Europe, 2003-07
• Background
• Strategic evaluation
• Financial performance
  • Figure 24: IKEA: Group financial performance, 2002/03-2006/07
  • Figure 25: IKEA: Largest markets, 2006/07
  • Figure 26: IKEA: Sales as share of furniture retailers' sales in France, 2002/03-2006/07
  • Figure 27: IKEA France: Performance, 2002/03-2006/07
  • Figure 28: IKEA: Sales as share of furniture retailers' sales in Germany, 2002/03-2006/07
  • Figure 29: IKEA Germany: Performance, 2002/03-2006/07
  • Figure 30: IKEA: Sales as share of furniture retailers' sales in Sweden, 2002/03-2006/07
  • Figure 31: IKEA Sweden: Performance, 2002/03-2006/07
  • Figure 32: IKEA: Sales as share of furniture retailers' sales in UK, 2002/03-2006/07
  • Figure 33: IKEA UK: Performance, 2002/03-2006/07
• Store portfolio
  • Figure 34: IKEA: Number of stores per country, 2006/07
  • Figure 35: IKEA: Outlet data, 2002/03-2006/07
  • Figure 36: IKEA: Planned openings, year ending August 2008
• Retail offering
• Retail offer
• Market positioning
• Pricing
• Operational issues
  • Figure 37: IKEA: Purchasing by region, 2007
• Advertising
• Brand and loyalty card
• e-commerce
  • Figure 38: IKEA: Websites
• Mercatone Uno
  • Figure 39: Mercatone Uno: Sales as share of Furniture retailers' sales in Italy, 2003-07
• Strategic evaluation
• Background
• Financial performance
  • Figure 40: Mercatone Uno: Group financial performance, 2003-07
• Store portfolio
  • Figure 41: Mercatone Uno: Outlet data, 2003-07
• Retail offering
• Market positioning
• Brands
• Product offer
• Pricing
• Advertising and marketing
• e-commerce and home shopping