New from Freedonia Group: US Demand for Outdoor Furniture & Grills to Reach $6.5 Billion in 2008

Business Wire, Oct 18, 2004

CLEVELAND -- US demand for outdoor furniture and grill products (including patio heaters and accessories such as covers, cushions and grilling utensils) will increase 5.4 percent annually through 2008, to $6.5 billion. The market will benefit from increases in the number of households and the penetration of outdoor living areas such as patios, porches and decks. In addition, consumer lifestyle trends such as "cocooning"-- spending significant time at home -- and "outdoor rooms" -- using items such as furniture and grills to extend the home's living space outdoors -- will support gains as consumers continue to trade up to better products. Still, increases are not expected to be as rapid as in the 1998 to 2003 period, since many homeowners have already exchanged starter furniture sets and grills for better quality items.

The grill segment is expected to see the fastest increases through 2008, benefitting from ongoing upgrades to more feature-intensive and better constructed grills and the move to more expensive gas grills from basic charcoal models. However, the larger outdoor furniture segment will also exhibit favorable gains, rising more than five percent per year.

The US runs a significant trade deficit in outdoor furniture and grills, with imports accounting for more than 40 percent of demand in 2003. While Chinese suppliers have taken significant market share from US-based producers, there has also been a good deal of import substitution, with Chinese firms taking business from suppliers in the rest of the Asia/Pacific region.

The residential market is essential to the outdoor furniture and grill industry, accounting for more than 90 percent of total demand in 2003, thus, consumer spending trends and consumer fashions are critical to the industry's well-being. Many homeowners have significantly upgraded their outdoor living spaces. Initially, much of this spending focused on garden items; however, as the trend matured, spending also turned to patios and deck areas. This resulted in upgrades to outdoor furniture and grill products, moving from inexpensive plastic furniture to higher quality metal dining sets, for example.