GERMANY - Business scenario uncertain and exceptionally challenging for the German furniture industry according to Jan Kurth, Managing Director of the Associations of the German Furniture Industry (VDM/VHK).

 The coronavirus shock in spring 2020 was followed by a surprisingly rapid recovery, but this was thwarted by the drastic shortage of materials in the course of 2021. The increase in the cost of almost all input materials became a major burden for the industry, particularly because the drastic cost increases could not be passed on in full or only with a time lag.

In the first half of 2022, German furniture manufacturers increased their sales by 13.4 percent to around EUR 9.5 billion. The growth in sales primarily reflects the increased cost of materials. Volume growth was significantly lower than sales growth. In the month of June, meanwhile, momentum weakened with sales up 4.3 percent.

However, furniture manufacturers are concerned about the development of demand in the months of June and July, which is affecting the lower price segment in particular - both in stationary retail and in online retail. Order intake slumped significantly in July.

It is becoming apparent that the second half of the year will be more difficult for the industry than the first six months. Higher prices for food and energy, the threat of gas shortages, and uncertainties about the further course of the Ukraine war and the development of the pandemic are affecting consumer outlook.