For Indians, renting is not new concept; we have been renting things for decades now. However, until few years back, the renting business was restricted to high value items such as house, wedding attire including jewellery amongst others. But, now there is a growing trend of renting low valued items such as home appliances and regular- use furniture. Furniture is one category which is getting maximum traction as far as renting is concerned. The growth in this segment is mainly attributed to influx of working class and growth of student community in top eight cities. Also, evolved consumers like to experimentation with furniture from time and again. In order to cater the demand, companies such as Rentomojo, CityFurnish, Furlenco, Rentickle, GrabOnRent, RentOnGo, Pepperfry, Fabrento, Guarented, among others are doing their best to appeal metropolitan way of life.
Let’s caste light on key elements pumping growth in this segment..
As per industry data, the furniture business in India is growing at a healthy rate during 2017- 2024, and this market is expected to increase by $800-850 million from current size. Speaking on market growth, Sidhant Lamba, Founder, Fabrento said, “The current market size for furniture rentals is estimated to stand at a significant amount of 1-1.5 billion dollars in India which will only continue to increase as more and more people become aware of the option of rentals and choose this cost-effective and hassle-free way over shelling out big bucks to buy bulky furniture.” Fabrento was founded by Sidhant Lamba in the mid 2016 with the support of the Continental group.
Speaking about the same, Ashwin Venkatraman, Chief Operating Officer, Furlenco, said, “Urban millennials are practical. They believe in living in the moment and are not interested in owning expensive things. For them, it is important to be smart and live a life that prioritises their comfort. And subscription as a way of life suits that mindset.”
Furlenco is an online-only furniture company catering to the lifestyle aspirations of contemporary urban Indians. From a handful of orders in the first year to having furnished about 90,000 homes, Furlenco has grown from strength to strength. The company aims to achieve a subscription revenue of INR 2000 crore by the year 2023.
Indian furniture renting market can be segmented on basis elements including type of furniture, tenure, business model and region. In terms of furniture category, sofa, wardrobe, bed get maximum traction. As per TechSci report, ‘Bed’ category acquired the majority share in 2018 and the trend is likely to continue in the forthcoming years as well. This is primarily due to the factor that bed is the primary requirement of customers moving to new places and rest of the furniture items in the category are generally add-ons. In recent past, kids’ furniture category is also picking up as many renting companies are expanding their product range.
On the basis of tenure, the market can be segmented into upto 1 year, 1-2 year and over 2 years. Among them, 1-2 year is the preferred duration of renting by the youngsters, as indicated by the report.
Speaking on behavioral shift, Vineet Chawla, Founder, Rentickle, said apprised,” There has been a major shift in consumer mindsets from owning to renting of various products. While sharing economy has been made popular by large global companies like Uber, Air B etc, today the rented products categories has expanded to garments, accessories, high end motorcycles and even DSLR cameras.”
A closer look at the industry data reveals that home furniture segment, so far, is the largest contributor, closely followed by office and institutional segment such as hospitality, healthcare and so on.
Echoing with Chawla, Neerav Jain, Founder &CEO, CityFurnish, “Today’s generation is more evolved and adapt to the modern lifestyle than its counterpart. With unique and individual preferences, this set of people are opting for modern furniture and flexible usage and hence, makes for an important category to the retailers.”
A recent PWC study suggests that the shared economy in India is valued at $1.5bn with future projections of $10bn by 2030. The market is vast for more innovation and players to make renting a complete alternate to buying and furniture rental will be a mainstream category in another five years.