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Furniture on Rent Market

Furniture on Rent Market

Rise in Number of IT Startups and Cross-border Migration of People to Spur Furniture on Rent Market Growth During 2021-2031

Furniture on Rent Market
FACT6820MR

Tech Start-ups and Millennials Partying on Rental Furniture Model

Entrepreneurs and investors have revolutionized the furniture on rent business, which has secured more than US$ 100 Mn in investments from different investor archetypes in 2021.  As living areas and bedrooms turned into office spaces, and millennial consumers 'sit and shop' around the globe – the rental furniture industry came to the fore.

The US$ 5 Bn furniture on rent market has long been under the carpet, and thanks to tech based start-ups, the industry is gaining mainstream and attracting investments from the likes of Credit Suisse, Zinnia Global Fund, CE Ventures, Lightbox, and Great North Labs, being key propellers. Some of the key companies receiving funding include Fulenco, Feather, Inhabitr, and RentoMojo.

Furniture on rent as a business has been operational for a quite long period, but in the past three years, millennial entrepreneurs identified the pain points in temporary living and translated this into opportunity. They organized and pulled the so far unorganized and community / locality bounded business to the digital space.

furniture on rent industry assessment by FactMR

How Can Cross-border Migration Turn into a Wider Opportunity Window for Furniture on Rent Providers?

While migration of national residents between states and cities for the purpose of job change has already been the fuel to furniture on rent demand, cross-border population migration is expected to hold the next big opportunity.

While cross-border migration has been occurring largely for a growing number of long-term international assignments, there also has been a tremendous shift of population from developing to developed countries. This has triggered the growth of rental apartments, where most of owners prefer furniture on rent.

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With Germany Being the Economic Center of Europe, Why is Furniture on Rent Yet to Mark a Strong Foothold Here?

Furnished rental apartments are scarce in Germany, even in cities such as Hamburg, Stuttgart, Munich, Heidelberg, Berlin, and Frankfurt. In smaller towns, such apartments further become non-existent. German landlords who rent their apartments prefer to purchase furniture for rental purposes instead of renting them. Besides, they are also least bothered about the maintenance of furniture and other household assets that are supposed to be rented.

Also, Germans tend to be more loyal towards their job as compared to other European counterparts, which minimizes relocation instances, consequently reducing the opportunities for furniture on rent businesses. However, these demographic trends have been reshaping in Germany to the benefit of the furniture on rent industry.

Residents from the U.S., Canada, Australia, Japan, Israel, New Zealand, and Switzerland do not require a visa to arrive in Germany. This has created an external demand for furniture on rent in the country, as using rental furniture in countries such the U.S., Switzerland, and Australia is common.                    

Why is North America Projected to Offer Sizable Opportunity for the Furniture on Rent Industry?

While furniture renting has been common in the U.S. and Canada, there have been several companies offering renting solutions in these countries. Some of the companies include CORT, Aaron’s LLC, Rent-A-Center, Feather, Brook Furniture Rental, Inc., Fernish, American Furniture Rental, and Fashion Furniture Rental, among others.

According to Michael Barlow, the co-founder and CEO of Fernish, over the coming years, generation Z in the country will be less interested in buying, owning, moving, selling, and storing furniture every time they move to a different city for a job. This showcases how the supply chain of the furniture ecosystem is going to evolve in the world’s largest economy.  

Besides residential customers’ interest in furniture on rent, opportunities are abound through commercial customers in the U.S., owing to booming number of start-ups, especially those pertaining to the IT sector.

North America is projected to account for over 30% of the projected US$ 5 Bn opportunity in the global furniture on rent market from 2021 to 2031. In 2019, consumer goods rentals generated US$ 50 Bn revenue in the U.S.

At 6.8% projected market growth during 2021 – 2031, the furniture on rent market is expected to accelerate at a significantly higher pace than the historical period of 2016 to 2020.

The furniture subscription rental model is expected to account for an absolute dollar opportunity of over US$ 4 Bn during 2021 – 2031.       

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Furniture on Rent – How Does the Growth Story Traverse to Tier-2 Cities? 

Until 2019, tier-1 cities were the center of attention for furniture on rent providers. However, constant development of tier-2 cities in the recent past has aligned dwellers’ requirements towards a rent-based economy, including house on rent, car on rent, and also furniture on rent.

A leading furniture on rent company CORT has a significant rental presence in the Northeast U.S., Southeast U.S. and Midwest U.S.; however, it has expanded considerably to the Intermountain and Pacific regions. Besides, several companies have been offering flexible subscription models to tier-2 city dwellers to make their foothold firm across those areas.

Start-ups Providing a Growth Cushion to PE Investors in Rental Furniture Market

According to the market research analysis, investments have been a prominent development in furniture on rent in recent years.

Some of the recent developments of key furniture on rent providers are as follows:

  • In July 2021, Furlenco raised US$ 140 Mn in a Series D funding by Zinnia Global Fund, a Mauritius-based company, alongside CE Ventures and Lightbox, the other two investors.
  • In March 2021, Rentomojo raised US$ 1.3 Mn in a Series C funding from two returning investors.
  • In August 2020, Feather, a U.S. furniture on rent provider, received US$ 30 Mn funding from Credit Suisse in a Series B funding. Before this, Feather had raised US$ 46 Mn in equity and debt financing.
  • In June 2020, RentoMojo raised US$ 2.9 Mn in a Series C funding round from Pratithi Investment Trust.
  • In May 2020, RentoMojo raised US$ 3.2 Mn from Accel India, Chiratae Ventures, Bain Capital, BCIP Venture Associates, and a French-American entrepreneur Renaud Laplanche. 
  • In April 2020, Furlenco announced that it had closed its debt and equity round led by its existing investors. 
  • In November 2019, Inhabitr, a U.S. furniture on rent provider, raised US$ 4 Mn in a Series A funding from Great North Labs.    
  • In May 2019, RentoMojo received US$ 10.2 Mn funding from Chiratae Ventures and Accel.

Similarly, recent developments related to companies offering furniture on rent have been tracked by the team at Fact.MR, which are available in the full report.

An Adaptive Approach to Modern-day Research Needs

Key Points Covered in Furniture on Rent Industry Survey:

  • Market Estimates and Forecasts (2016-2031)
  • Key Drivers and Restraints Shaping Market Growth
  • Segment-wise, Country-wise, and Region-wise Analysis
  • Competition Mapping and Benchmarking
  • Market Share Analysis
  • COVID-19 Impact on Furniture on Rent and How to Navigate
  • Recommendation on Key Winning Strategies

Revenue Analysis of Furniture on Rent from 2016 to 2020 Compared to Demand Outlook for 2021 to 2031

As per the furniture on rent industry research by Fact.MR - a market research and competitive intelligence provider, historically, from 2016 to 2020, market value of furniture on rent increased at around 3.8% CAGR, wherein, countries such as the U.S., U.K., Netherlands, Switzerland, and Japan held significant share in the global market.

Constant surge in the cost of asset procurement is one of the evident reasons for the growth in furniture on rent subscriptions. Alongside, steady rise in the number of small and medium IT enterprises has further fuelled this model of furniture procurement.

Owing to these dynamics, the global furniture on rent market is projected to accelerate at a CAGR of 6.8% over the coming 10 years.

  • The furniture on rent market reached a valuation of US$ 5.3 Bn in 2020; however, worldwide revenue was down 6% year-over-year owing to the affected business sentiments of commercial enterprises amid COVID-19. Fact.MR estimates that furniture on rent revenue will grow 1.9X from 2021 to 2031, crossing US$ 10 Bn in 2031.
  • Subscription model of furniture renting corresponds to over 3/4 of global revenue, and is expected to grow at a faster pace compared to individual furniture renting.
  • Commercial users are expected to continue to account for denser proportion of revenue with over 55% share.
  • Long rental cycle is projected to account for over US$ 3 Bn absolute dollar opportunity over the decade.  
  • In the coming 10 years, furniture in rent revenue through the buy and rent business model is expected to swell at a CAGR of 7.2%
  • Top 5 providers of furniture on rent held over 90% market share in 2020.

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How are Blooming Small and Medium Enterprises Catalysing Furniture on Rent Ecosystem?

Asset procurement is one of the key concerns for small and medium enterprises during their initial years. Especially for IT firms with backend work patterns, renting furniture significantly reduces their fixed cost component.

Besides, several furniture on rent providers also offer deep clean services, furniture maintenance, and periodical furniture swap, as well as relocation services without any additional charges. This proves to be a boon for start-ups that need these services for the smooth operation of their business.         

Will Availability of Funding Prove to Be the Lifeblood for Furniture on Rent Business Owners?     

Furniture on rent is a new concept for several emerging countries where users are able to evaluate the long-term benefits of renting their furniture instead of buying it. However, in such countries, furniture on rent businesses are usually low on budget and need financial backup to resist the ups and downs in their venture and innovate to match local requirements.

Presence of venture capitalists and their interest in this aspirational business model has provided a backbone of support to these business owners.

  • For instance, Furlenco is one of the furniture on rent companies that has successful garnered funding from different venture capitalists. Furlenco has raised over US$ 160 Mn in series C, series D, debt financing, and venture rounds, since 2018 till date.  

Country-wise Analysis

Which Country Lies at the Centerstage for Furniture on Rent Revenue in Europe?

The Netherlands, a home to furniture manufacturers and rental providers such as IKEA and JMT International, accounted for over 30% of European furniture on rent revenue. The Dutch rental housing market is sub-divided into two sectors, namely, the social rental sector and the private rental sector.

According to Huurwoningen, a Dutch home planning company, the Netherlands has more than 3 Mn rental homes, of which, 75% belong to housing associations. These houses accommodate citizens in low-income groups.

These low income groups with a low budget for procuring household assets, and housing associations’ inclination to provide houses with lower maintenance of household assets, make the Netherlands a fertile ground for the furniture on rent business.   

Category-wise Insights

Why are Furniture Subscriptions the Preferred Rental Model?

Commercial enterprises stand as key customers for furniture on rent businesses, whose requirements are met by furniture subscriptions, wherein they get a set of furniture meeting their office requirements, and alongside get services such as furniture swap, deep cleaning, and periodical maintenance, as well as relocation services in the subscription.

Furniture subscription generated over 3/4 of the revenue in 2020.

Which Rental Cycle Accounts for Highest Revenue in the Furniture on Rent Space?

Long rental cycles that include subscriptions of 18 months to more than 2 years accounts for nearly 60% of furniture on rent revenue.

Long rental cycles come with greater benefits as compared to short cycles and custom cycles. Also, the renter gets peace of mind with long cycle rentals. According to the trend, new users generally tend to opt for shorter cycles, and after a few months, they upgrade to longer cycles after satisfactory services.        

How Has COVID-19 Impacted Revenue Generation from Furniture on Rent?

COVID-19 marked a mixed impact on the furniture on rent space, wherein, the net numerical impact was a -6% year on year growth (a decline of 6%) in 2020. SMEs that were most impacted during the pandemic who offered their employees work from home options refrained from renewing furniture on rent subscriptions owing to tightened budgets. This halted the revenue outflow in this industry.

On the brighter side, furniture on rent revenue was boosted to some degree from residential customers who either rented furniture to accommodate their work from home model or shifted to other cities to take on available opportunities owing to job losses.

Furniture on Rent Market Report Scope

Attribute

Details

Market size value in 2021

USD 5.6 Billion

Market forecast value in 2031

USD 10 Billion

Growth Rate

CAGR of 6.8% from 2021 to 2031

Forecast Period

2021-2031

Historical Data Available for

2016-2020

Market Analysis

US$ Mn for Value & ‘000 Units for Volume

Key Regions Covered

  • North America
  • Latin America
  • Europe
  • East Asia
  • South Asia
  • Oceania
  • MEA

Key Countries Covered

  • United States
  • Canada
  • Brazil
  • Mexico
  • Germany
  • U.K.
  • France
  • Switzerland
  • Netherland
  • China
  • Japan
  • South Korea
  • India
  • Indonesia
  • Singapore
  • Australia
  • New Zealand
  • Turkey
  • South Africa
  • GCC Countries

Key Market Segments Covered

  • Rental Model
  • User Type
  • Rental Cycle
  • Business Model
  • Country

Key Companies Profiled

  • CORT
  • JMT International
  • Aaron's, LLC
  • Rent-A-Center
  • Thomas Rentals
  • Feather
  • Brook Furniture Rental, Inc.
  • IKEA
  • Fernish
  • Lyght Living furniture leasing GmbH & Co. KG
  • American Furniture Rental
  • Fashion Furniture Rental
  • Charter Furniture Rental
  • Furniture Rentals
  • Custom Furniture Rental
  • The Attic
  • Furlenco
  • CityFurnish
  • Inhabitr
  • Fabrento
  • Others

Pricing

Available upon Request

Market Segments Covered in Furniture on Rent Industry Research

  • By Rental Model

    • Individual Furniture
      • Living Room Furniture
      • Bedroom Furniture
      • Dining Room Furniture
      • Other Furniture Categories
    • Furniture Subscription
  • By Rental Cycle

    • Short Cycle Furniture on Rent
      • Day-based Furniture on Rent
      • Monthly Furniture on Rent
      • Quarterly Furniture on Rent
      • Bi-Annually Furniture on Rent
      • Annually Furniture on Rent
    • Long Cycle Furniture on Rent
      • 18 Months Furniture on Rent
      • 2 Years Furniture on Rent
      • 2.5 Year Furniture on Rent
      • 3 Years Furniture on Rent
      • More than 3 Years Furniture on Rent
    • Custom Cycle Furniture on Rent
  • By User Type

    • Furniture on Rent for Residential Users
    • Furniture on Rent for Commercial Users
      • Corporate Users
      • Hotels and Restaurants
      • Educational Institutions
      • Other Commercial Users
    • Furniture on Rent for Occasion-based Users
  • By Business Model

    • Buy and Rent
    • Rental Intermediates
    • Manufacture and Rent

Furniture on Rent Market - Scope of Report

A recent study by Fact.MR on the furniture on rent market offers a 10-year forecast for 2021 to 2031. The study analyzes crucial trends that are currently determining the growth of the market. This report explicates on vital dynamics, such as the drivers, restraints, and opportunities for key market players along with key stakeholders as well as emerging players associated with offering furniture on rent.

The study also provides the dynamics responsible for influencing the future status of the market over the forecast period. A detailed assessment of value chain analysis, business execution, and supply chain analysis across regional markets has been covered in the report.

A list of prominent companies offering furniture on rent, along with their product portfolios, enhances the reliability of this comprehensive research study. This also includes analysis of PE and angel investor active in the furniture on rent business

Report Summary

The study offers comprehensive analysis on diverse features, including subscription base, demand, product developments, revenue generation, and revenue from furniture on rent across the globe and also across different countries.

A comprehensive estimate on the market has been provided through an optimistic as well as a conservative scenario, taking into account revenue from rental furniture during the forecast period. Subscription cost comparison at country level with regional and global average price has also been considered in the study.

Key Questions Answered in Report

  • Which are the most lucrative furniture on rent markets?
  • Which factors will impact the growth of furniture on rent?
  • How does the investment landscape for furniture on rent look like?
  • How will changing trends impact the strategies of market players?
  • How can market players capture the low-hanging opportunities across regions?
  • Which companies are leading the furniture on rent industry?
  • What are the winning strategies of stakeholders in the market?
  • What is the analysis on subscription share evolution of start-ups?

The market has been analyzed for each segment in terms of no. of subscribers and relative value (US$ Mn).

Estimates at global and regional levels for furniture on rent are available in terms of “US$ Mn” for value and number of subscriber in “million”. A Y-o-Y growth contrast on prominent market segments, along with market attractiveness evaluation, has been incorporated in the report. Furthermore, absolute dollar opportunity analysis of all the segments adds prominence to the report. Absolute dollar opportunity plays a crucial role in assessing the level of opportunity that a manufacturer/distributor can look to achieve, along with identifying potential resources, considering the sales and distribution perspective in the global Furniture on Rent market.

Assessment on Regional Segments

Key sections have been elaborated in the report, which have helped deliver projections on regional markets. These chapters include regional macros (temporary living population, household spending on furniture, per capita disposable income, smartphone penetration, etc.), which are expected to have a momentous influence on the growth of furniture on rent during the forecast period.

Country-specific valuation on demand for furniture on rent has been offered for each region, along with market scope estimates and forecasts, price index, and impact analysis of the dynamics of prominence in regions and countries. For all regional markets, Y-o-Y growth estimates have also been incorporated in the report.

Detailed breakup in terms of value and subscribers for key countries has also been included in the report.

In-depth Analysis on Competition and Vendor Landscape

The report sheds light on leading providers of furniture on rent, along with their detailed profiles. Essential and up-to-date data related to market performers who are principally engaged in offering furniture on rent has been brought with the help of a detailed dashboard view. Market share analysis and comparison of prominent players provided in the report permits report readers to take preemptive steps in advancing their businesses.

Company profiles have been included in the report, which include essentials such as product portfolios and key strategies, along with all-inclusive SWOT analysis on each player. Company presence is mapped and presented through a matrix for all the prominent players, thus providing readers with actionable insights, which helps in thoughtfully presenting the market status, and predicting the competition level in the furniture on rent market.

Research Methodology

In Fact.MR’s study, a unique research methodology is utilized to conduct extensive research on the growth of the furniture on rent industry, and reach conclusions on the future growth parameters. This research methodology is a combination of primary and secondary research, which helps analysts ensure the accuracy and reliability of the drawn conclusions. Data collected from multiple sources is subjected to internal statistical and forecast model to calibrate over a thousand data points that has been indicated in the report.

Secondary resources referred to by analysts during the preparation of the market study include statistics from investors, company financial documents, white papers, governmental organizations, and internal and external proprietary databases. Analysts have interviewed senior managers, product portfolio managers, CEOs, VPs, marketing/product managers, and market intelligence managers, all of whom have contributed to the development of the research report as a primary resource.

- FAQs -

The global furniture on rent market is worth more than US$ 5.3 Bn at present.

Value of furniture on rent is projected to increase at a CAGR of around 6.8% during 2021 – 2031.

Value of furniture on rent increased at a CAGR of around 3.8% during 2016 – 2020.

Significant investment flows have been a key trend in the furniture on rent ecosystem.

Furniture on rent revenue is being primarily driven by a spurt in the number of IT start-ups who tend not to invest in fixed assets, and instead prefer renting them.

Top 5 suppliers of furniture on rent account for over 90% share in the market.

Top 5 countries driving demand for furniture on rent are the U.S., Netherlands, U.K. Switzerland, and Japan.

North America accounted for over 40% of global furniture on rent demand in 2020.

The European market for furniture on rent is projected to expand at a CAGR of around 7% over the decade.

While the market in South Korea is expected to grow at nearly 9%, the market in Japan is projected to register a CAGR of nearly 8% during 2021 - 2031.

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Is the market research conducted by Fact.MR?

Yes, the report has been compiled by expert analysts of Fact.MR, through a combination of primary and secondary research. To know more about how the research was conducted, you can speak to a research analyst.

What research methodology is followed by Fact.MR?

Fact.MR follows a methodology that encompasses the demand-side assessment of the market, and triangulates the same through a supply-side analysis. This methodology is based on the use of standard market structure, methods, and definitions.

What are the sources of secondary research?

Fact.MR conducts extensive secondary research through proprietary databases, paid databases, and information available in the public domain. We refer to industry associations, company press releases, annual reports, investor presentations, and research papers. More information about desk research is available upon request.

Who are the respondents for primary research?

Fact.MR speaks to stakeholders across the spectrum, including C-level executives, distributors, product manufacturers, and industry experts. For a full list of primary respondents, please reach out to us.

Is a sample of this report available for evaluation?

Yes, you can request a sample, and it will be sent to you through an email.