Home Textiles: Global Drivers of Demand and Future Outlook · 2010-2015 % Growth +US$ 5,491 +US$ 2,967 +US$ 5,491 +US$ 909 +US$ 6,489 +US$ 2,894 +US$ 8,221 ... South Korea Finland

HOME TEXTILES: GLOBAL DRIVERS OF DEMAND AND FUTURE OUTLOOKJORGE MARTIN – EUROMONITOR INTERNATIONAL

NOVEMBER 2016

© Euromonitor International

2EUROMONITOR INTERNATIONAL

Euromonitor International Ltd.

© Euromonitor International

3EUROMONITOR INTERNATIONAL

GLOBAL DRIVERS OF DEMAND

IMPACT ON HOME TEXTILES

INDIA

FUTURE OUTLOOK

© Euromonitor International

5GLOBAL DRIVERS OF DEMAND

Three key growth drivers

Income levels

Housing market

Retailing landscape

© Euromonitor International

6

Growing wealth boosts discretionary spending GLOBAL DRIVERS OF DEMAND

0 50 100

Ukraine

Mexico

Hong Kong,China

Turkey

Romania

Brazil

Thailand

India

Indonesia

China

Top 10 Markets Home Textiles Retail Value

Growth 2010-2015

% Growth

+US$ 5,491

+US$ 2,967

+US$ 5,491

+US$ 909

+US$ 6,489

+US$ 2,894

+US$ 8,221

+US$ 27,486

+US$ 5,146

+US$ 1,809

© Euromonitor International

7

Global urbanisationGLOBAL DRIVERS OF DEMAND

177…Million new households created over the review period between 2010 and 2015.

…Of these nearly 90% were Urban

0

500,000

1,000,000

1,500,000

2,000,000

2,500,000

3,000,000

2000 2010 2020 2030

Urban vs. Rural Households 2000-2030

Urban Households Rural Households-20 0 20 40 60 80

Hong Kong, China

India

Thailand

Ukraine

China

Brazil

Turkey

Housing Completions Growth2010-2015

Mexico Romania

© Euromonitor International

8

Low wage

growth

Rising property

prices

Renting

“Generation rent” GLOBAL DRIVERS OF DEMAND

0 20 40 60

Sweden

Australia

United Kingdom

Switzerland

Czech Republic

Belgium

USA

Netherlands

South Korea

Finland

New Zealand

France

Hong Kong, China

Austria

China

United Arab Emirates

Denmark

Egypt

Germany

Saudi Arabia

Top 20 markets with highest proportion of renting

© Euromonitor International

9

Retail consolidation GLOBAL DRIVERS OF DEMAND

11% VS. 7%

20% VS. 4%

228% VS. 164%0

20

40

60

80

100

120

140

160

0

5

10

15

20

25

30

35

40

45

50

Home andGarden

SpecialistRetailers

GroceryRetailers

InternetRetailing

Key Distribution Channels Globally 2015

Period Growth Channel

Fast-fashion’s love affair with home textiles GLOBAL DRIVERS OF DEMAND

© Euromonitor International

11

Cheaper, trendier and widely available GLOBAL DRIVERS OF DEMAND

0

5

10

15

20

25

30

2010 2011 2012 2013 2014 2015

Home Textiles, Ikea and Zara Home Growth 2010-2015

Home Textiles Ikea Zara Home

Over 500outlets in

53 different

markets

Over 368stores in

23different

markets

GLOBAL DRIVERS OF DEMAND

IMPACT ON HOME TEXTILES

INDIA

FUTURE OUTLOOK

Key facts and figures IMPACT ON HOME TEXTILES

US$101bnGlobal Retail Value Sales

in 2015

3%Global Retail Value

Growth in 2015

ChinaContributed with 27% of

global value sales

© Euromonitor International

14

Bed textiles remain the heavy weight IMPACT ON HOME TEXTILES

Home Textiles by Type in 2015

Bath Textiles Bed Textiles Kitchen and Dining Textiles Living Room Textiles Rugs

11%US$11 Bn

10%US$10

Bn

13%US$13

Bn

20%US$20

Bn

46%US$47

Bn

GLOBAL DRIVERS OF DEMAND

IMPACT ON HOME TEXTILES

INDIA

FUTURE OUTLOOK

© Euromonitor International

16

India illustrates huge potential centred on mega-cities INDIA

© Euromonitor International

17

The path to growth in India: From unbranded to branded INDIA

Opportunities

• Growing purchasing power

• Greater demand

• Transition to smaller households

• Modern retail expansion

• E-commerce

Challenges

• Poor infrastructure for retail expansion

• Income disparity

• Legislation

• Informal retailing

• Unbranded

Informal Retail

Formal Retail

US$2 BnHome Textiles Retail Value Sales 2015

7% Home Textiles Retail Value Growth in 2015

8%Home Textiles Retail Value Growth to 2020

INDIA

GLOBAL DRIVERS OF DEMAND

IMPACT ON HOME TEXTILES

INDIA

FUTURE OUTLOOK

© Euromonitor International

20

Emerging markets will continue driving growth FUTURE OUTLOOK

-4

-2

0

2

4

6

8

10

12

14

0.00 5.00 10.00 15.00 20.00 25.00 30.00 35.00 40.00 45.00

% G

row

th o

f N

o. o

f H

ou

se

ho

lds

Disposable income growth

Top 10 Fastest Growing Home Textiles Markets to 2020

China Romania Indonesia Malaysia

United Arab Emirates Spain Thailand Argentina

© Euromonitor International

21

Contrasting factors shaping the future of the regionsKEY TAKEAWAYS

Strong growth forecast

Buoyant housing market

Strong social mobility

Young population

Home textiles =

Staple products

Weak growth forecast

Struggling property market

Uncertain economic situation

Ageing population

Home Textiles = Discretionary

products

• Asia Pacific

• Middle East

• Africa

• North America

• Australasia

• Western and Eastern Europe

THANK YOU FOR LISTENINGJorge Martin | Project Manager - Research

Jorge.Martin@euromonitor.com

Euromonitor International