20.11.2008

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A view of developments in the office furniture business by Otmar Stein, sales and marketing director of König + Neurath AG.

The office furniture industry looks forward to 2005 with optimism


While the initial improvement may be slow, the office furniture industry expects an upturn in the market in 2005: there have been encouraging indicators in the last 9 months. Now that the emplyment market is becoming more stable, one can expect growing willingness to invest in office workstations to meet current and future requirements. We are looking forward with great excitement to Orgatec: as the world’s largest office furniture exhibition, it always serves as an excellent industry barometer.

In Germany, there are still some 4.8 million worksations which do not conform to the EU standards for VDU workstations which have been in force for the last 10 years. Despite the theoretical demand, companies who are shedding labour do not replace old furniture. On the one hand there was no moral justification, and on the other the constant restructuring left no fixed basis on which to plan. In the office furniture industry, this led to a further market decline in 2003: the BSO (Verband der Büro-, Sitz- und Objektmöbel) has put this decline at 17%.

Now all indications are that the labour market is turning, and that the mass redundancies have stopped. This was the conclusion of the “Welt am Sonntag”, based on a survey among a variety of institutions (WamS 3.10.04). After the loss of 420.000 jobs in 2003, Holger Schäfer of the IW (Institut der deutschen Wirtschaft) is expecting a year of level employment rates, or perhaps a very small further loss of jobs.

The new firm base for planning motivates people to seek new solutions

For the office furniture industry, these developments mean that companies believe their employee numbers have stabilised, and that is therefore time to catch up with the overdue demand for workstations which meet current and future requirements. On the one hand, we are noticing stronger demand from established companies looking to replace their desking and seating. On the other hand, the newer companies are looking more closely at achieving the most effective use of space. Innovative and space-saving models for space utilisation call for office layouts which cannot be achieved with old furniture, which no longer corresponds to the way the work is done, and gives no motivation to the employee. This creates a significant new demand for future-proof office concepts which provide intelligent and economical support to the new ways of working.


Inefficient use of space is a waste of money

Mergers and restructuring have eliminated jobs: there are lots of empty desks. In addition, there is an increasing trend to employees sharing a desk in “shifts”. This all leads to a drastic reduction in the amount of dedicated office space. And the demand for office space is reduced even more by the growing number of employees who are working almost everywhere except in the office. Telecommunications make it possible.

Now, with steady employee numbers providing a firm planning basis, we find receptive audiences when we talk of attractive and effective workstations in the minimum space: from mobile and flexible desking systems via desk-sharing concepts to Stand-by-Office solutions, which provide a “just-in-time” workstation which still has a personalised feel with appropriate privacy. An effective plan for desk-sharing can provide significant reductions in office operating costs. This is especially true for meeting/conference areas, which have often been empty for most of the time. Today we offer solutions and components which allow the one desk to be used for meetings, team work and individual work: multifunctional use of the one space.


Added value for the employee instead of high fixed costs.

As a recognised manufacturer of ergonomically refined office furniture, we are also expecting growth in the area of the more “high-tech” items. We find that companies who are able to make significant reductions in space costs are willing to pass on some of the benefit to their employees in the new furniture layouts. The desk can cost a bit more, as long as it has all the ergonomic features which will have a positive effect – physical and psychological – on the employee. In the area of individual workstatins, we have noticed this year a clear increase in the number of so-called “Lift” desks. They can be raised electrically to standing height, and encourage the regular change of working position from sitting to standing. This corresponds to the current thinking about preventive measures for health and safety in the workplace. Company doctors and safety officers confirm repeatedly that the additional investment in such workstations is soon paid back by the reduction in days off sick.


Falling rents encourage a move to modern office buildings

In Germany there are some 9 million square metres (97 million square feet) of empty office space, yet many companies are working in sub-standard buildings. Until recently, the first thought would have been to refurbish the offices and stay in the current building; the low rents for good, new buildings now encourages companies to move. We expect many companies to move offices in the coming year, to buildings which offer modern, flexible floorplates. This generates increased demand for total office solutions: desking, seating, storage and partitioning. As a “one stop shop”, with solutions for every requirement at different budget levels, we at K+N expect increased turnover in this area.


Export business will increase

In addition to the positive developments in the home market, the whole industry expects an increase in exports. This is particularly the case for up-market task chairs “made in Germany”, whose ergonomic benefits are recognised around the world. Seating has been a good area for K+N: in the first 9 months of this year, our sales have shown double-digit growth, well above the industry average.


Know-how is more in demand than ever

After the big slump of recent years, the industry can approach Orgatec with optimism. Many companies are ready to make decisions on new fit-outs. Given the radically different demands being made on workstations – partly as a result of the recent crisis – companies need the professional input of planners and manufacturers more than ever. The company which can offer – in addition to appropriate furniture – genuine consultancy and a dependable support through the whole process from planning to delivery and installation, including even the disposal of old furniture, can now make an opportunity out of the crisis.

König + Neurath, Germany

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