Every year since 2001 there’s been a steady decline in the number of businesses who specialize in retailing of lumber/building materials, flooring, and furniture. Over that same time, there’s been a massive uptick in e-commerce. We crunched the numbers and here’s what we found. Check our info graphic below for more!
Number of businesses and employment
- For all three industries, there’s been an average 33.5% decline in the number of businesses between 2001 and 2014, with flooring hit the hardest. The total decline in flooring retailers worked out to be almost 37%.
- While lumber & building materials has added employees over the period, both flooring and furniture have seen declines in employment of 40% and 27% respectively. Over 120,000 jobs have disappeared since 2001 in those industries.
- Most of the businesses that have closed their doors appear to be smaller, single location operations.
- Non-store retailers do 40.5 times more e-commerce than traditional retailers ($28 billion compared to $691 million).
- Total sales in traditional retail for furniture and home furnishings in 2015: 106.7B
- Total sales in non-store retail, e-commerce only in 2015: 28B or 26% of combined sales for traditional retail
- In 1999, non-store e-commerce sales were $350MM, which means they have increased 80x through 2015.
We also took a look at how the big boxes & e-commerce are working out. A few interesting points:
- Home Depot did $5.5B in e-commerce in 2016 and say 19% growth in Q4 of 2016 in their pro segment alone
- 60% of Lowe’s online orders are picked up in store, and 40% of customers who order online and pick up in store buy additional items when they pick up.
- 45% of Home Depot’s online orders are picked up in the store
- U.S. retail growth in the first half of 2016 2%, compared to 16% growth in e-commerce. That means e-commerce grew at an 8x higher rate.
One thing seems very clear: customers increasingly prefer e-commerce even if they’re picking up in the store, as a result e-commerce is here to stay and will continue to significantly outpace traditional in-store sales growth. Going forward, it will continue to be a cornerstone of the entire customer experience especially as more and more millennials come into the market and workforce.