It is important to note that due to the relatively lower consumption levels and purchasing power in third- and fourth-tier markets, many first-tier brands—accustomed to competing in first- and second-tier cities—may feel uncertain about entering these regions. Some companies even believe that targeting these markets could dilute their brand image, making it seem more low-end. Therefore, developing and launching products tailored to the specific needs of these markets is crucial for long-term success.
In Beijing, a number of well-known international furniture brands such as Horizon, Jin Qitai, American Standard, Baxi (Sweden), and Bee (Italy) have come together in a luxury villa building, offering high-end home décor materials, including furniture, to be sold through a cooperative marketing alliance. This initiative allows them to target high-end real estate projects, villas, and luxury apartments by leveraging collective branding and packaging strategies. The alliance not only fosters close collaboration with top real estate developers and interior design firms but also actively explores online sales channels to secure more project orders.
Beyond this “warmth-driven†approach, market segmentation and gradual entry have played a vital role in helping furniture companies navigate economic challenges.
The children’s furniture market has emerged as a promising opportunity. While exports remain sluggish, China’s growing economy has led to improved living standards. Parents are increasingly investing in children’s rooms, making children’s furniture a popular choice. Brands like I Love My Family, More Love, and Colorful Life have gained recognition, while traditional furniture companies such as Qumei, Yifeng, Red Apple, and Totem Baojia have also entered the segment. Qumei launched youth furniture during Children’s Day, while Totem Baojia introduced its own brand "Tutu Jiajia" and opened an experience store in Beijing. Italian brands have also started focusing on children’s furniture.
According to market research, there are over 300 million children under 16 in China, accounting for roughly one-quarter of the population. With growing emphasis on children’s room decor, the market potential is enormous. Zhu Changling from the China Furniture Association noted that children’s furniture began in the late 1990s and now makes up about 10% of the domestic furniture market.
One of the biggest advantages of children’s furniture is that it is less affected by the real estate market and instead grows with the birth of children. Its audience spans from age 0 to 18, with purchasing power coming from parents aged 35 to 45. However, challenges such as lack of standards, high production costs, and poor management still hinder industry growth. There is no dedicated institution or official standards, and production requires higher safety and environmental requirements. The design must also consider children's physical and psychological needs, avoiding sharp edges and ensuring safe, adaptable furniture.
Despite these challenges, the custom furniture trend is gaining momentum. Middle- and low-income workers often seek local artisans to make furniture at home, while white-collar professionals are drawn to the personalization, style, and efficiency of customized options. Companies like Hao Laike and Dinggu have expanded into custom furniture, meeting rising demand. Custom furniture accounts for about 10% of the market and offers greater flexibility in space utilization and design coordination.
Currently, the custom furniture market remains fragmented, with many small factories offering basic customization. This creates an opportunity for larger, more professional companies to enter and establish themselves.
Traditionally, major brands focused on first- and second-tier cities like Beijing, Shanghai, Shenyang, and Qingdao. However, since 2009, sales in these cities have declined, while third- and fourth-tier markets have seen increased popularity. With around 150 million households in these areas, and 30% of them having demand, the market potential reaches 150 billion yuan. As income rises, so does purchasing power, driven by urbanization.
Many furniture companies are now targeting these markets as strategic growth areas. Sichuan-based brands like Quanyou and Shuanghu have built strong brand recognition in these regions. Although competition is currently weaker, the market is still developing, offering opportunities for new entrants.
Logistics and after-sales service in these scattered markets can increase costs and affect quality. Companies should conduct data-driven market analysis and ensure product quality to reduce losses and return rates. In terms of sales channels, the distributed nature of third- and fourth-tier markets presents challenges. First-tier brands need to adapt by creating regional marketing systems, establishing benchmark markets, and strengthening local brand promotion and terminal services.
For more information, please visit the official website of Xianghe Furniture City.
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