The Australia Office Furniture Market is estimated to be valued at USD 1.14 Bn in 2024 and is expected to reach USD 1.44 Bn by 2031, growing at a compound annual growth rate (CAGR) of 2.4% from 2024 to 2031. The market has been growing modestly over the past few years and this growth is expected to continue over the forecast period.

Office furniture purchases are often among the last items considered when outfitting or remodeling commercial office spaces. In recent years, there has been a trend towards flexible, ergonomic furniture that can be rearranged as team structures and workspace needs change. Height-adjustable desks and sitting/standing desks have increased in popularity as employers and employees recognize the health benefits of mobility in the workplace.

Market Driver – Increasing number of startups and SMEs

The Australian economy has seen a steady growth in the number of startups and small to medium enterprises in recent years. Ease of doing business, strong intellectual property laws and access to risk capital have made Australia an attractive destination for entrepreneurs. While many global companies have large established offices, it is these new businesses that are driving demand for flexible office furniture solutions.

Startups and young businesses prefer to keep their operating costs low during the initial phases of establishing themselves. Purchasing furniture outright puts pressure on cash flows. This has led to strong interest in flexible furniture leasing and rental options. Major furniture retailers have recognized this emerging trend and have expanded their product lines to cater to these specific needs. Modular furniture systems that can be assembled, reconfigured and scaled up or down based on changing business requirements are proving popular.  Co-working spaces have also proliferated across major cities to support collaboration among independent professionals and startups. While early players offered basic amenities, new operators are focusing on design and amenities to attract tenants. This has increased demand for high quality, ergonomic and aesthetically pleasing furniture that matches contemporary office designs. Furniture made from sustainable materials is gaining precedence as businesses want to project responsible credentials.

As these new enterprises mature and expand, their furniture needs also evolve. Reputable furniture brands launched specialized programs to help such businesses upgrade in a phased manner. Equipment financing and professional services for space planning and logistics are part of the proposition. This ensures a smooth transition as a startup grows without large upfront capital outlays.

Market Driver – Growth in the commercial construction sector

Strong population growth as well as significant investment flowing into Australia's commercial real estate market has augured well for businesses in the commercial construction industry. Major cities across the country have ambitious infrastructure and construction plans that involve new business districts, commercial hubs, education precincts and other developments.

This high level of construction activity directly spurs demand for commercial interiors including various types of furniture. Developers work closely with specialist contractors during the outfitting of workplace interiors. Prime office spaces need to be furnished and decorated to a high standard before occupiers move in. This reliably translates to bulk orders for furniture, wall panelling, carpeting, lighting and other fit-out items. As the economy transitions out of the pandemic, corporations are also re-thinking their real estate footprint and office designs. Trends like hybrid work models and focus on employee well-being have prompted renovations and retrofitting of existing office stock. This provides opportunities for furniture and interiors retailers to work on upgrade projects. Customized solutions incorporating modern design principles and technology integrations are gaining traction.

Market Challenges: Trade barriers and high taxation

The Australian office furniture market faces ongoing challenges owing to trade barriers and a high tax environment. Significant import tariffs on office furniture make foreign suppliers' products more expensive in the Australian market compared to locally manufactured goods. This protects local manufacturers but limits choice and affordability for customers. Tariffs as high as 5-10% on imported wooden and metal office furniture restrict access to global designs and latest trends. Additionally, Australia's corporate tax rate of 30% imposes a considerable cost burden on local manufacturers and distributors. The high business taxes eat into company profits and make Australian products less competitive globally. This discourages expansions and investments that could help build economies of scale and address rising production costs from inflation. Stricter emissions standards also drive-up overhead expenses. While trade barriers and taxation aim to shield local jobs, they ultimately make the market smaller and costlier, limiting its long-term growth potential.

Market Opportunities: Rise of co-working spaces and outsourcing of non-core functions

There are also positive trends emerging that present opportunities for suppliers. The rise of co-working and flexible office spaces in major cities is increasing demand for contemporary, modular furniture suitable for hot-desking and freelancers. As more startups and small companies adopt this model to cut costs, the market for such shared workspace fittings is experiencing growth. At the same time, many large enterprises are outsourcing non-core functions like facilities and procurement to specialists. This hands opportunities to contract furniture suppliers who can better handle large-scale installation, customization and lifecycle management services. By offering comprehensive solutions for dynamic workspace needs, suppliers stand to gain recurring revenue streams. They can also target regional centers where firms are decentralizing some functions to reduce rents in capital cities. With the right strategies to capitalize on these developing market shifts, suppliers can partially offset challenges from policy issues.

Focus on innovation and new product development: Companies like Herman Miller and Steelcase have heavily invested in R&D to develop innovative new products that meet the evolving needs of Australian workplaces. In 2021, Herman Miller launched new seating, tables and storage products with adjustable features to support hybrid workstyles. These products were well received, helping Herman Miller grow its market share by 5% that year.

Offering customized and flexible solutions: Australian businesses now demand office furniture that can be easily reconfigured as workplace needs change. Major players like Klewel and Formway have tailored their offerings to include modular, flexible furniture systems that allow offices to refresh layouts swiftly. When Klewel launched its reconfigurable workstation system in 2018, it saw over 30% increase in government contract wins within a year as this addressed a key client priority.

Adopting a consultative sales approach: Successful companies engage clients via a consultative process to fully understand their unique furniture needs and space constraints. For example, Fern's experienced designers work with clients from design concept to installation. This customer-centric strategy has positioned Fern as Australia's trusted choice, especially among large enterprises, with annual revenues growing by an average of 15% since adopting this approach in 2015.

Leveraging distribution partnerships: Widespread distributor networks are important for reaching customers across diverse geographies like Australia. Global player Steelcase has benefited from maintaining longstanding partnerships with national distributors like Bisley who hold key inventory and provide on-site design services as a 'one-stop-shop'. This distributed fulfilment approach has allowed Steelcase to grow market share rapidly outside major cities.

Insights by product type: Comfort and Ergonomics Drive Demand for Office Seating

Seating contributes the 44.3% share of the Australia office furniture market in 2024, due to the importance companies place on employee comfort. Sitting for long periods at work can cause physical strain and reduce productivity if proper ergonomic seating is not provided. Companies understand the need to prioritize their employees' physical well-being and comfort in order to boost morale and retention.

The wide variety of seating options available allows workplaces to tailor their choices to employee preferences and job functions. Managers are increasingly concerned with providing adjustable, customizable seating accommodate different body types and types of work. Features like lumbar support, armrests, and ergonomic back designs have become must-haves. Employees also expect a degree of choice and personalization in their workstations.

Collaboration and meeting spaces also drive demand for different types of seating. In addition to traditional office desk chairs, there is a growing market for sofas, armchairs and ottomans suited to more relaxed discussions. As open floor plans and activity-based working become more prevalent, comfortable, flexible seating suitable to both informal and formal discussions is key. Companies outfit huddle spaces and break areas with inviting seating to encourage interaction between employees. Meeting increasing demand for ergonomic health and customized comfort, Australian manufacturers continue developing innovative new seating technologies and materials. Their focus on user experience and wellness keeps office seating the highest share of the country's office furniture market. Attention to comfort and well-being will remain paramount as workstyles evolve in the years ahead.

Insights by end user: Corporate Real Estate Strategies Fuel Demand from Large Companies

The corporate offices end-user segment generates the 54.80% share of demand in the Australia office furniture market in 2024. Large corporations have significant real estate footprints and undertake frequent refurbishment projects requiring new furnishings. They also have ample capital and specialized procurement teams focused on outfitting office spaces. A key driver of demand is corporate real estate strategies increasingly prioritizing employees, collaboration, and brand image. Forward-thinking companies design workplaces not just for function but also to attract and engage talent. They view office design, technology and furnishings as a competitive differentiator. Comfortable, innovative workspaces are seen as investments in company culture and worker productivity.

Activity-based working has also prompted many corporations to replace traditional desk-centric layouts with variety of spaces optimized for different tasks. This includes private phone booths, mobile desks and adjustable furniture compatible with hot desking. Such transformations drive periodic large-scale office furniture procurement. As Australia's major corporations expand both locally and abroad, their global standardization of furnishings and interiors helps manufacturers benefit from large volume orders. Keeping international workplaces consistently branded maintains a prestigious company image. Demand from prominent end-users establishes Australia's office suppliers as partners supporting sophisticated real estate strategies.

The major players operating in the Australia Office Furniture Market include IKEA Pty Limited,Harvey Norman Holdings Limited,Living Edge (Aust) Pty Ltd,Fantastic Furniture ,Amart Furniture Pty Limited,King Furniture Australia Pty Ltd,Saveba Pty Ltd trading as Coco Republic,Kogan Australia Pty Ltd

• In May 2024, the family of the late Australian architect Roy Grounds revealed a new collaborative furniture collection with K5 Furniture.This collection showcases classic silhouettes infused with modern sensibilities, presenting a limited-edition range in vibrant hues for a contemporary twist.
• In July 2023, Australian design firm Derlot launched its Strap collection, comprising 11 distinct seating types inspired by vintage pool furniture adorned with fabric slings. The collection includes stools, chairs, benches, and loungers, all characterized by minimalist frames and robust aluminum strips. These elements combine to offer durable seating options suitable for various public and private settings.

• By Product Type
  • Seating
  • Desks & Tables
  • Workstation
  • Accessories
  • Storage Units
• By End User
  • Corporate Offices
  • Others
  • Government Offices