In the context of the overall recovery in the home industry, Red Star Macalline celebrated its 27th anniversary. During the first half of the year, the total sales generated by merchants during the "2 Days" promotion, the May Day campaign, and the anniversary event surpassed 6 billion yuan, marking an increase of over 10% compared to the same period last year.
Red Star Macalline’s sales data reflect several key trends in China's home consumption during the first half of the year: the construction materials sector remains strong throughout the year, solid wood furniture is in high demand, and the outlook for custom furniture looks promising. Industry experts believe that as the largest domestic home distribution company, Red Star Macalline serves as a strong indicator and predictor of market trends in the home industry.
**Review of the First Half**
Second- and third-tier cities have played a significant role in boosting the industry. According to Red Star Macalline data, sales of building materials increased by 25% year-on-year in the first half of 2013, while furniture sales rose by 13.7%. Given that the furniture industry typically lags behind real estate by about 10 months, the recovery in the housing market in the second half of 2012 contributed to the rebound in the furniture and building materials sectors.
At an early press conference in March, Red Star Macalline Chairman Che Jianxin predicted that the home furnishing industry would see growth of more than 10% in 2013. This forecast aligns with the broader recovery trend highlighted in the National Building Materials Home Furnishing Prosperity Data jointly released by the Ministry of Commerce and the China Building Materials Circulation Association.
Notably, second- and third-tier cities saw greater growth in furniture and building materials sales compared to first-tier cities. For example, in the first quarter, cities like Changsha, Shijiazhuang, and Changzhou experienced strong growth in building material sales, while household products maintained steady increases. During the "Two Days" promotional event in March, many second- and third-tier cities saw a surge in sales, with cities like Datong, Shenyang, Dalian, and Taizhou recording substantial year-on-year growth, with some malls seeing sales increase by up to 35 times.
**Furniture: Panel is Cold, Wood is Hot**
Data also show that sales of solid wood furniture in Red Star Macalline’s nationwide network have surged, while panel furniture sales have declined significantly. The top three brands in solid wood furniture are Futaba, Bosen, and Qingdao Yimu.
Solid wood furniture has become increasingly popular, reflecting a major shift in the market. Zhu Changling, chairman of the China Furniture Association, noted that the growing popularity of solid wood furniture is driven by both economic and consumer behavior factors. He explained, “Firstly, people's living standards have improved, and they now have more disposable income. Solid wood furniture, being made from premium materials, reflects one’s economic status and social standing. Secondly, solid wood furniture uses natural wood with minimal adhesives and paints, resulting in lower formaldehyde emissions and being more environmentally friendly.â€
According to a survey conducted by Red Star Macalline and the Home Furnishing Trends Institute, 70% of consumers prioritize quality and environmental protection when purchasing furniture. In their eyes, environmental protection means a product that is free from harmful odors, with non-irritating characteristics being the most important factor.
A representative from Red Star Macalline added that the popularity of solid wood furniture is also linked to China’s long-standing “wood culture,†which has been part of Chinese tradition for over 2,000 years. Wooden household items hold deep cultural significance for Chinese consumers, making them an essential part of daily life.
**Building Materials: Off-Season is Not Light**
Traditionally, June is not considered a peak season for building materials, but Red Star Macalline’s nationwide anniversary event achieved sales of over 1.5 billion yuan, with the building materials category contributing nearly 50%. This off-season success highlights a shift in the seasonal patterns of the building materials industry.
In the past, after the “Red May†promotion, the building materials market usually entered a traditional off-season between June and August. However, Red Star Macalline believes this trend is changing. More savvy consumers are viewing the off-season as their own peak time, as they can enjoy better service, more flexibility, and higher value during these periods. They often prefer to schedule renovations during off-peak times, as decoration companies and workers are less busy, ensuring better quality and progress.
**Outlook for the Second Half of the Year**
Red Star Macalline expects further growth in the home industry, driven by the continued improvement in the real estate market since last October. Sales are anticipated to rise significantly in the second half of the year.
With the increasing influence of the 1980s generation, personalized consumer demand has become the norm. Custom furniture aligns well with the preferences of modern young consumers who value individuality and self-expression. As a result, demand for custom-made furniture is on the rise. High-end custom furniture already accounts for around 10% of the total furniture market, indicating a bright future for this segment.
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