In the furniture industry, during the first ten years, top-tier brands have dominated with impressive growth. However, in the next decade, second-tier brands are beginning to gain momentum and establish themselves in the mainstream market. High franchise fees, rising operational costs, and strict performance metrics have placed significant pressure on top-tier brand dealers. According to recent data, 40% of these dealers have switched to second-tier brands over the past year, and this trend is expected to continue.
Many top-tier brands set high entry barriers, requiring prime locations, large store sizes, and high sales targets. In well-established commercial areas, where occupancy rates often exceed 98%, it's increasingly difficult for big brands to secure suitable spaces. Additionally, some top-tier brands rely heavily on their brand recognition and offer limited support to franchisees, resulting in thin profit margins and low survival rates for their stores.
The fierce competition among top-tier furniture brands has led to a challenging environment for franchisees. Meanwhile, brands below the third tier struggle to find space in the market, which discourages potential investors. As a result, second-tier brands are emerging as a more attractive option.
Despite the challenges, many second-tier brands are thriving by offering strong support to their franchisees. These companies provide training, marketing assistance, and other resources that help franchisees succeed. Over time, these franchisees have become more experienced and capable, often matching or even surpassing the performance of their top-tier counterparts.
Second-tier brands are gaining popularity among investors due to their supportive business models and effective retail strategies. While top-tier brands still hold certain advantages, the high entry barriers make them less accessible for many. As a result, many dealers are now considering second-tier brands as their preferred choice for future investments.
With growing consumer demand from the post-80s and post-90s generations, who prioritize affordability and practicality, second-tier brands are well-positioned to meet these needs. These consumers are looking for mid-range products that offer good value without compromising on quality.
Given the support from manufacturers, favorable market positioning, and strong appeal to specific consumer groups, second-tier brands are becoming a key focus for both investment and consumption. They are gradually taking over the mainstream market and are likely to play a major role in the future of the industry. (Editor: Peter)
Euro Facade Frame System,European Style Facade Frame System
Chuzhou Jincheng Metalwork Co.,Ltd , https://www.jinchengscaffold.com