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2021 was a great year

From the HGO Merchandiser

 6 June 2022     Michael J. Knell 

Brick-and-mortar furniture stores had a boom year in 2021, according to figures published by Statistics Canada in the year-end edition of its Monthly Retail Trade Survey (MRTS). That’s the good news. Now, here’s the bad news. Experts agree it’s a performance unlikely to repeat itself, at least in the short term.

The same is true of home furnishings stores – a catch-all category that includes carpet and flooring stores; stores specializing in lamps and lighting; as well as retailers focusing on occasionally and accent furniture as well as decorative accessories – which also rang-up record high sales not likely to be repeated anytime soon.

The only big-ticket home goods category turning in a more normal rate of growth in 2021 was electronics and appliance stores.

The publicly held Leon’s Furniture Limited held on to its position as this country’s largest full-line furniture, mattress, appliance and electronics retailer in 2021 with system-wide sales of $3.06 billion. Seen here is their store in Saskatoon.It should be noted Statistics Canada’s MRTS focuses on brick-and-mortar, or location-based, retail. So, when discussing furniture store sales, the figures cited represent the collective sales by every merchant with a physical location, from industry stalwarts such as Leon’s, The Brick, Sleep Country, IKEA and Brault & Martineau to the single store independent – as well as their digital platforms.

However, the MRTS does not include the emerging digital powerhouses such as Article, Rove Concepts, or their Canadian contemporaries. Neither does it include the Canadian offshoots of such e-commerce giants as Wayfair and Amazon.

At the end of 2021, brick-and-mortar furniture store sales totaled a record high $13.3 billion, a gain of 14.9% over the $11.6 billion rung-up in 2020, which despite government-imposed restrictions to curb the spread of the COVID-19 pandemic was only a 1.7% dip from 2019’s $11.8 billion.

Indeed, the unexpectedly low downturn in 2020 was attributed – almost entirely – to the accelerated execution of long-simmering plans on the part of almost every brick-and-mortar heavyweight to get serious about becoming true omni-channel retailers. It was a move that paid even more dividends in 2021.

For example, prior to the pandemic’s arrival in March 2020, most analysts estimated e-commerce accounted for only 5% of the revenue generated by Leon’s Furniture Limited (LFL). After the lockdowns, the publicly held parent of Leon’s, The Brick and Appliance Canada, saw its e-commerce platforms’ share of revenue jump to 16% in 2020, before advancing to 24% of sales in 2021.

E-commerce was also the fastest growing contributor to Sleep Country Canada Holdings’ (SCC) top line revenue in each of the past two years. Digital sales accounted for more than 23% of 2021 sales for the parent of Sleep Country, Dormez-vous and Endy, among others. In fact, SCC’s primary motivation for acquiring the Toronto-based Endy was to give it access to the fast-growing digital marketplace.

Not to be outdone, IKEA Canada, part of the global home furnishings giant based in The Netherlands, admitted in a report published just prior to last Christmas that its e-commerce platforms accounted for 37.4% of its revenue during its most recent fiscal year ending August 2021.

Collectively, these three retailers – who are this country’s three largest furniture store operators as defined by Statistics Canada – accounted for 49.6% of all brick-and-mortar furniture store sales last year. HGO estimates their combined digital sales for 2021 at $1.79 billion, approximately 27% of their collective sales and13.4% of all brick-and-mortar furniture store sales last year.

Unfortunately, the data gives no insight into the sales mix by product category. For example, analysis of the data published by Statistics Canada in its Retail Commodity Survey (RCS) reveals mattresses account for roughly 14.5% of all brick-and-mortar furniture store sales while indoor furniture – that is, what the industry normally refers to as upholstery and case goods – accounts for roughly 42.0%. It’s not known if this pattern holds true for their digital platforms.

Meanwhile, home furnishings stores had collective sales of $7.71 billion in 2021, up 19.1% from the prior year’s $6.48 billion.

Turning in a more normal growth rate were electronics and appliance stores whose 2021 tally of $15.4 billion was up 4.5% from the $14.8 billion rung-up in 2020. 

Click here to read the rest of our report in the HGO Merchandiser.

Stearns & Foster
This HGO article was written by:
Michael J. Knell
Michael J. Knell

Michael is the publisher and editor of Home Goods Online. A seasoned business journalist, he has researched and written about the furniture, mattress and major appliance industries in both Canada and the United States for the past three decades.

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Home Goods and its accompanying newsletter - HGO This Week - covers the furniture, bedding, appliances, consumer electronics, accessories, lamps and lighting and floor coverings product sectors of the big ticket home goods market in Canada. HGO is also a forum for the dissemination of market research and hard-hitting articles on best practices for Canadian retailers.

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