High Inflation Rates Hit Furniture Market as Prices Soar

The furniture industry is grappling with soaring prices as multiple companies continue to raise their rates, resulting in a significant inflation rate for items such as sofas, beds, desks, and sinks.

Sofas, in particular, have experienced a price surge of over 20%, while desks have seen an increase of more than 10%.

Data from the National Statistical Office’s National Statistics Portal reveals that in June, sofa prices increased by 20.7% compared to the same month the previous year. This growth rate shows a substantial jump from the 1.5% increase recorded in April, which escalated further in May.

Similarly, desk prices experienced an inflation rate of 11.3% last month, while sinks saw a rate of 9.6%. Beds were up by 6.9%, chairs by 6.8%, and dining tables by 6.3%. These figures reflect more than double the overall consumer price inflation rate of 2.7%.

The inflation rate for desks skyrocketed from 4.6% in March to 12.4% in April, then continued to climb to 17.4% in May before slightly slowing down last month, though remaining above 10%. Sink prices rose from 1.6% in April to 6.3% in May, approaching the 10% mark in the following month.

The primary reason behind this surge in inflation is the successive price hikes imposed by furniture companies. Leading furniture manufacturer Hanssem raised prices five times last year and implemented three consecutive price increases on beds and student furniture from January to March this year. Additionally, on the 17th of this month, they raised the prices of all items in the home furnishing sector by an average of 3%.

Hyundai Livart also raised furniture prices three times last year, followed by a 5% increase in the prices of sofas, beds, and chairs for their home furniture brands in offline stores in January this year. An official from Hyundai Livart explained that costs had risen by 30% over the past three years, and although they had previously absorbed losses, a slight additional increase this year became inevitable.

Last year, IKEA Korea and Illum raised prices three times, while Sealy Bed and Tempur raised prices twice. Ace Bed, Shinsegae Casa, Emmons, and Enex also implemented price increases.

Furniture manufacturers attribute these price hikes to rising raw material costs, increased labor expenses, and a decline in the real estate market. However, some argue that these actions may be a response to sluggish performance as raw material prices have recently stabilized.

Hanssem reported a consolidated operating loss of 21.7 billion won last year, marking their first loss since going public. Hyundai Livart also posted an operating loss of 27.9 billion won in the same period.

Haps Staff
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