Market Insights into the Custom Home Furnishings Industry

I. Analysis of the Industry Status Quo

As a typical post-real estate cycle industry, the custom home furnishings industry is closely linked to the development of the real estate market. Driven by the commercialization of housing and the process of urbanization, the industry once experienced a phase of rapid growth. Numerous enterprises achieved sustained growth over the years, creating performance myths.

In recent years, with the cooling of the real estate market, the custom home furnishings industry has been significantly impacted. According to the 2024 half-year reports, among 9 A-share listed custom home furnishings enterprises, 8 saw a decline in net profit, 7 experienced a drop in revenue, and even 2 suffered performance losses. A report released by the China Building Materials Circulation Association shows that in the first half of this year, the total sales volume of large-scale building materials and home furnishing stores across the country reached 688.18 billion yuan, a year-on-year decrease of 8.12%. As a leading enterprise in the industry, OPPEIN Home also witnessed a double-digit decline in both revenue and net profit in the first half of 2024.

From the perspective of the market competition pattern, the advantages of leading enterprises have become increasingly prominent. In the first half of 2025, KUKA Home ranked first with a revenue of 9.801 billion yuan, followed by OPPEIN Home with 8.241 billion yuan. The combined revenue of these two leading enterprises accounted for 60.66% of the total revenue of 10 major custom home furnishings enterprises. In the custom home furnishings business segment, OPPEIN Home still holds a leading position in the industry relying on its profound customization genes and large-scale production.

II. Changes in Consumer Demand

With the development of the times and the transformation of consumption concepts, consumers’ demand for custom home furnishings has undergone significant changes. They have shifted from pursuing “usability” to “good usability”, and pay more attention to simplicity, functionality and quality. Currently, the life concept of “decluttering” (discarding unnecessary items and simplifying life) is prevalent. Consumers no longer blindly pursue filling up space, but tend to create a simple, practical and high-quality home environment.

Consumers no longer simply value the style of home furnishings, but pay more attention to spatial mood, intelligence and storage functions. They hope that the home space can create a comfortable and warm atmosphere to meet their emotional needs. The popularization of smart home products has led to a growing demand for home intelligence among consumers, who expect to enhance the convenience of life through intelligence. With the increase in daily items, efficient storage functions have become an important consideration for custom home furnishings.

The rise of the young consumer group has also brought new demands to the custom home furnishings market. When choosing whole-house customization services, post-85s consumers give a weight of 37% to personalized design, which ranks first, surpassing the factor of price. They pursue unique and personalized home design, hoping to show their personality and taste through home furnishings.

III. Corporate Response Strategies

3.1 Layout in the Stock Market

Against the backdrop of the continuous shrinkage of the new housing home furnishings market, the stock housing home furnishings market, represented by second-hand housing renovation and old house renewal, has attracted great attention from enterprises. At present, the scale of domestic stock housing is huge: there are 270 million residential houses with a building age of more than 20 years, and the transaction volume of second-hand houses nationwide accounts for 37.1% of the total housing transaction volume. In 2023, the total output value of the domestic home improvement industry was approximately 2.77 trillion yuan, of which the demand for partial home renovation by consumers exceeded 35%, and the scale of the home improvement renewal market was nearly 1 trillion yuan.

Faced with the opportunities in the stock market, many enterprises have actively deployed. Since 2022, Sofia has gradually launched new product categories such as kitchen cabinets, systematic doors and windows, and bathroom products to seize high-frequency demand products in the old house renovation market. OPPEIN Home launched a renewal subsidy campaign on September 20, 2024, with joint subsidies from the government and enterprises to stimulate consumption. OLO Home also stated that the home and home improvement trade-in subsidy policy has brought more sales opportunities to the company. KUKA Home has obtained nearly 10,000 customer orders through trade-in activities, effectively promoting consumers’ purchase willingness.

3.2 Expansion into Overseas Markets

In the context of the sluggish industry and intensified competition in the domestic market, going global has become a new direction for many custom home furnishings enterprises. In the first half of this year, the export volume of furniture and its parts surged by 18.3% year-on-year to 251.33 billion yuan, making the “going global” of home furnishings enterprises a new trend.

A number of listed companies have actively laid out overseas markets. Enterprises such as Zhibang Home, Gold Home, OPPEIN Home and KUKA Home all achieved significant growth in overseas business revenue in the first half of this year. KUKA Home has set up benchmark brand stores for whole-house finished products in countries such as India, Vietnam and Thailand, and its overseas brand influence has been continuously deepened. 尚品宅配 (SPZP) has recruited brand franchisees globally and opened new exhibition halls in Vietnam, the Philippines, Myanmar and other places.

3.3 Improvement of Products and Services

In the stage of stock market competition, improving product delivery capabilities and service quality has become the focus of enterprise competition. After the implementation of the “trade-in” policy, consumer demand in the home furnishings industry has recovered. Enterprises no longer rely solely on price competition, but instead make efforts in products and services.

At the 2025 Annual Marketing Summit, OPPEIN Home proposed to promote product quality innovation from five quality dimensions: design, raw materials, manufacturing process, logistics and installation, and build a full-process quality control system. Holike held a delivery efficiency improvement conference, focusing on efficiency enhancement from five dimensions including full-category installation and omni-channel layout. Sofia released the “China Custom Home 5A Standard”, which is formulated based on the whole life cycle of users.

IV. Future Development Trends

4.1 Integration of Intelligence and Personalization

With the continuous advancement of technology, smart homes will be more widely used in custom home furnishings. Consumers’ demand for intelligence will drive enterprises to deeply integrate intelligent elements into custom home furnishing products, realizing the organic integration of intelligence and personalization. In the future, custom home furnishings will not only meet consumers’ personalized design needs, but also provide consumers with a convenient and comfortable life experience through intelligent systems, such as intelligent lighting control and intelligent home appliance interconnection.

4.2 Green and Environmental Protection Becoming the Mainstream

The enhancement of consumers’ environmental awareness has made green and environmental protection the mainstream trend in the development of the custom home furnishings industry. In the future, enterprises will increase investment in the research and development and application of environmentally friendly materials, and improve product environmental standards. For example, the utilization rate of ENF-grade environmentally friendly boards will continue to increase, and more enterprises will adopt formaldehyde-free processing technology to create a green and healthy home environment for consumers.

4.3 Full-Link Digital Transformation

Digital technology will run through the entire link of R&D, production, sales and service of custom home furnishings enterprises. Through big data analysis, enterprises can accurately grasp consumer demand and optimize product R&D and design. In the production link, intelligent manufacturing technology will improve production efficiency and product quality, and reduce costs. In the sales and service links, digital platforms will enhance customer experience and realize the integrated development of online and offline channels. For instance, Holike has built a “life scene map” based on user data to accurately predict market design preferences and improve the accuracy of product R&D.

4.4 Continuous Improvement of Market Concentration

Against the background of intensified market competition and industry transformation, leading enterprises will further seize market share relying on advantages in brand, scale, technology and channels, and market concentration will continue to improve. Leading enterprises will build competitive advantages through means such as supply chain integration and digital empowerment. For example, OPPEIN has built an industrial Internet platform to realize full-link collaboration. Small and medium-sized enterprises, on the other hand, need to seek space for survival and development through differentiated competition and deep cultivation in segmented fields.