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As the pandemic wanes, is the home office category still strong?

HIGH POINT — Even though the entire home furniture industry saw a massive uptick in business during the COVID pandemic, one category seemed to get the most attention. The home office category boomed, as millions of people throughout the country found themselves working at home for the first time.

But as the pandemic continues to wind down, how is the category faring? Is it still strong? If so, does it have more strength than it did before the pandemic?

The consensus seems to be mixed.

“Retail sales during the pandemic were up 30% to 40% in 2021 and 2022 over previous years, and demand was even higher,” said Dee Maas, vice president of sales at Martin Furniture. Martin specializes in home office and entertainment furniture.  “Had we been able to keep up with demand, sales would have been much higher.”

Demand has since normalized, Maas said, but the category will remain a staple.

“I think that high interest in office furniture brought back some retailers who had given up on the category,” she said. “I think a lot of people are still working remotely, or they are working a hybrid model with a split between home and office. An office space in the home has become important again.”

Company founder and CEO Gil Martin agreed, noting that plenty of people are still working from home.

“I think the category is still strong but not as strong as during the ‘COVID bump’ in 2021,” he said. “It did reinforce to retailers that office should have a good presence on their floors. So many workers are still working from home. The Zoom and Teams meeting I attend all seem to be with remote workers.”

Martin said the category is not as big as master bedroom, but he believes the category has gained space on retailers’ floors over the past three years.

As the pandemic wanes, is the home office category still strong?
Among Martin Furniture’s home office offerings is the Carson collection.

No question of commitment

Whole home supplier Parker House agreed to an extent, although was perhaps less optimistic in its outlook.

“There was a big explosion in home office during the pandemic, especially for desks, desk chairs, bookcases and file cabinets,” said Doug Townsend, chief operating officer. “At one point, you could go on Wayfair, and it would only have a few items in stock.

“It has since slowed considerably,” he said. “There was a dip as the pandemic waned. It’s still a strong category for us. COVID just pulled sales forward, so now the category is returning to normal.”

Jim O’Keefe, vice president of sales for the high-end Hekman Furniture, said demand is down across all categories, making it hard to judge properly.

“The category hasn’t fizzled,” he said. “But that rocket ship that we were enjoying has slowed down considerably. And making that comparison makes it look like something is wrong. But it still is an important category for us. It’s one of our bigger categories.

O’Keefe did say the category was down in 2022 marginally compared with other categories.

“All categories are down to a similar degree,” he said. “But coming into the end of the year, home office did do a bit worse for us than other categories.

“Still, we introduced a whole new line of adjustable height desks that are doing well,” O’Keefe continued. “We have custom office chairs. We’re still absolutely committed to the category.”

Legends Furniture manufacturers and imports bedroom, entertainment, home office and other categories, and like Hekman, the company says it remains committed despite decreased demand.

“The category never really went away,” said Tim Donk, vice president of product. “We’re playing it business as usual. We waited to get into the fads such as lift desks. I think those waning.

“I’m still optimistic,” he said. “Our groups hold their own. I’m developing home office from the two groups that we introduced in October. It is a core competency for us, but it is smaller. We had two new desks for the past Vegas market. I’m playing around with a junior executive desk that’s finished all the way around a little smaller in scale.

“Many homes don’t really have room for a home office,” Donk noted. “We’re not going to stop developing for it, but I’m not super excited about it.”

BDI, another home office and entertainment specialist, was perhaps the most upbeat on the category.

“The home office furniture category has leveled off from pandemic-level demand, but it remains consistent, as it continues to be an area that homeowners are investing in,” said Dave Adams, vice president of marketing. “But even as many have returned to the office, there continues to be a need for furniture that can adapt or convert to accommodate on-demand work areas in the home. With up to 92% of employees working at least one day per week remotely, it’s hard to find a household that doesn’t still need to accommodate a work-from-home function.”

Still, BDI recently unveiled its first bedroom collection, which will continue to be a focus for the company going forward.

Contract industry performance

Something that may give insight into the strength of home office is the office/contract furniture industry. The majority of the big players are seeing declining sales, with many reporting a slower than normal return to the office.

Steelcase, which cut 180 salaried positions in September, was among them.

“Due to the recent volume decline in our incoming orders and lower than expected return-to-office trends in the Americas, we are planning to implement additional actions in the third quarter, which target further reduction of our planned level of spending,” said Dave Sylvester, senior vice president in a third-quarter earnings report.

MillerKnoll, one of the biggest companies in the office furniture space, reported a 4.4% dip in sales from last year for the third quarter. HNI, another giant, reported a 6% decline.

“To be sure, this is a disruptive period,” said MillerKnoll CEO Andi Owen in a quarterly conference call. “Traditional office usage and layouts are not as they once were.”

Others however, including Haworth and Kimball, reported stronger sales, making it challenging to make sense of. Kimball, for example, reported 15% growth in sales of workplace furniture.

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