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Attractive furniture retail market

Vietnam’s furniture retail market is booming and bursting with exciting potential, due to growing demand for housing and furniture. The Vietnamese population is large and growing, and young couples now want to set up their own homes after marriage. This has increased the demand and spending for housing. In 2007, spending on housing in Vietnam was an estimated VND28 249.1 billion, an increase of 59.2% from 2000. Naturally, the demand for furniture and household products will increase as well.

With increasing income, houses are not only places for people to reside but also places for them to relax after work. Therefore Vietnamese now pay more attention on decorating their houses as beautifully as possible. As a result, spending on household goods and services has increased 69.1% from 2000 to 2007 to reach VND60 658.5 billion in 2007.  A further exploration of the Vietnamese consumer’s spending pattern shows that the expenditure on household products and services is the third largest at 8.64%, right after food and non-alcoholic beverages and transport. IKEA should definitely leverage on this growing demand for furniture by capturing a substantial share of the Vietnamese consumer’s share of wallet.

Trends in Furniture Retail Market

Vietnam’s furniture retail market is up and coming, there’s no denying it. Consumers are looking to elevate their perceived positions, thus there is a huge preference for foreign brands. With an admitted abundance of furniture production, it’s time that the furniture retail market began catering to savvy Vietnamese customers, many of whom have grown up with elevated perceptions of the Western world.

Research has also shown that Vietnamese consumers have a preference for contemporary, durable and affordable furniture with a DIY concept. Within the expenditure on household goods and services, the percentage growth in the amount spent on hardware and DIY goods increase by 60.3% from 2000-2007.

IKEA’s combination of foreign-branded, contemporary, affordable and DIY furniture certainly is in line with the current trends in the Vietnamese consumer market. IKEA bringing in modern furniture to Vietnam will definitely spell out a favorable outcome, culminating in a synergy that encapsulates arising values in Vietnam’s urbanizing culture.