NAICS: 33-7211 Wood Office Furniture Manufacturing, 33-7214 Office Furniture (Except Wood) Manufacturing
SIC: 2521 Wood Office Furniture Manufacturing, 2522 Office Furniture (Except Wood) Manufacturing
NAICS-Based Product Codes: 33-72111 through 33-7211A141, and 33-72141 through 33-7214A231
The designation of furniture specifically for an office environment is a relatively recent development in society. As civilization advanced from agrarian to industrial and finally to the high-tech information age, the evolution of furniture for business-related tasks has advanced to meet the needs of each era. As the nature of the work we do has changed, so too have the types of furniture that we need to do that work. This has always been the case, but the pace of change has increased since the integration of computer technology into the workplace. Computers, printers, scanners, and other electronic devices for office work are not considered furniture, however. Instead, office furniture includes desks, chairs, storage cabinets and shelving, lighting, and work environment products such as cubicle dividers.
Before the industrial revolution, office furniture was just part of the overall furniture of the home, whether it was located in a business setting or a household. Consisting primarily of tables, desks, chairs, and storage cabinets this furniture was not distinguished from other household furnishings in any particular way beyond the uses to which it was made. Merchants and large institutions were the first entities to need large quantities of what we now consider office furniture. Depending on the wealth of a merchant, the desk and chair he used were more or less elaborate pieces of furniture that were there to impress visitors as much as to store papers and ledgers. As society moved increasingly toward industrialization the massing of people into larger and larger entities led to increased needs for monitoring such tasks as inventory control, accounting, and staffing. Organizations grew, the administrative tasks associated with managing them grew, and the numbers employed in carrying out these administrative tasks grew.
Office furniture was made primarily of wood through the early twentieth century. Employees were often housed in large communal rooms, depending on the size of the business, with desks arranged in rows and aisles, affording little privacy. In the first decades of the twentieth century, a worker's station typically consisted of a desk, a wooden chair (often uncomfortable), a typewriter, and possibly an adding machine.
After the 1930s metal furniture for offices became more commonplace. Metal was seen as a safer material that was less of a fire hazard, and it tended to be less expensive than wood. During World War II, however, metal was needed to build military equipment, and so office accoutrements reverted back to wood. With metal supplies returning after the war, the material was once again incorporated into desks and filing cabinets. Office design began to be more creative by the 1960s and 1970s, with furniture often being a mix of metal and wood. Plastics and textiles were also incorporated as employers realized that more comfortable work environments could improve worker productivity. Part of this demand for comfort also led to designs that increased privacy and reduced noise. Workstations were partitioned with dividers that were often padded with textiles and sometimes foam. Sound-absorbing ceiling tiles helped reduce noise as well and adjustable chairs helped to ease back strain.
During the 1980s the typewriter that was so commonplace in office settings was being supplanted by the computer workstation or the personal computer. Office furniture needed to evolve to accommodate central processing units (CPUs), monitors, network wiring between workstations, printers, and storage for digital recording media such as tapes and diskettes. By the late 1980s desks were routinely being built with holes or tracks for Ethernet wiring and electric cords; in some cases, they were even prewired to accommodate a variety of electronics. Although computers were often touted as a means toward creating the paperless workplace, such dreams have yet to be realized, and filing cabinets are still in use today. Computer technology did, however, inspire the development of office station systems, interlinking collections of desks, cabinets, partitions, and drawers that are specially designed to be easily disassembled and reconfigured to meet changing needs.
As the networking of computers became a standard practice and those networks started to be more frequently connected to the developing World Wide Web, telecommuting rose as an alternative to daily commutes. Telecommuting was a development that opened opportunities for office furniture manufacturers and designers. The needs of a person wishing to work from home periodically made him or her a potential customer for new office furnishings to be used in the home. The Internet and local area networks allowed employees doing certain sorts of work the flexibility of work from home where they could connect to a remote location by using Internet protocols to connect a local computer with a computer at the remote location. Furniture was designed to provide office functionality as well as the ability to be closed off, like an armoire, so that when not in use the home office could be closed.
Technological changes and the general economic climate are the two most important influences on trends in the office furniture market. Design too has been an important aspect of the top office furniture companies. Manufacturers such as Steelcase and Knoll have become known for furniture that is not only functional but stylish and even artistic. Architect Frank Lloyd Wright has inspired some of the designs seen in Steelcase furniture, for instance, while artists and designers working for Knoll have won prizes and displayed their work at such cultural institutions as the Museum of Modern Art in New York, New York.
The office furniture market represented a $10 billion dollar industry in the United States in 2006. The market is directly tied to economic conditions both domestically and abroad, though only approximately 4 percent of total furniture produced in the United States was exported in 2004.
Manufacturers enjoyed a period of steady growth through the 1960s and into the early 1980s. Corporate downsizing from the late 1980s through the early 1990s had a negative impact on the demand for office furniture, and this was exacerbated by a recession from 1991 to 1992. Although there was a corresponding increase in U.S. exports—from $86.7 million in 1988 to $170.8 million the next year—this was not enough to offset declines in domestic sales. During the period from 1989 through 1991, office furniture saw a 9.7 percent decrease to $5.6 billion. This period of slowdown was followed by healthy growth through the rest of the 1990s. By the mid-1990s new excitement in the marketplace was inspired by the Internet boom. Many new companies established themselves on the promise of making money on e-commerce, with venture capitalists funding this new breed of high-tech corporation. By the end of the decade there were many of these dot-com companies whose survival depended heavily on the sale of Web site advertising. These ventures prospered briefly, splurging on high-end office furniture, especially in places such as Silicon Valley in California.
Entrepreneurial companies prospered, but the growth could not be sustained because it was not based on commodities but rather on virtual concepts such as Web site traffic. The promise of future sales based on Internet activity was never realized in most cases. Aggressive marketing to increase customers drove the dot.com industry, and as expenses soared they were not matched by profits. The exuberance of the dot.com era faded and shortly thereafter terrorist attacks against the United States exacerbated the situation by extending what had looked in early 2001 like it would be a brief economic recession. The economy slowed further and the resulting decline in demand for office furniture forced many smaller manufacturers into bankruptcy.
As if these complications were not enough, office furniture manufacturers had to fight against the Federal Prison Industries (FPI) program started in the 1990s. This government-funded initiative had prison workers making furniture that the government bought, which completely shut out private manufacturers from a lucrative segment of the business. Private industry eventually took legal action to get legislation passed that ended government favoritism of the FPI, and litigation was still ongoing in the middle of the first decade of the twenty-first century.
All of these factors combined resulting in a rise in sales through the late 1990s, a decline in the early 2000s, and a subsequent recovery by the middle of the decade. According to U.S. Census Bureau Department of Commerce statistics, office supply sales of wooden furniture saw an increase from $3.02 billion in 1997 to $3.77 billion in 2001. Non-wooden furniture, primarily metals and plastics, saw growth of $8.35 billion in 1997 to $8.75 in 2000, before seeing a drop-off to $7.46 billion in 2001. After the 2001 setback, the industry slowly recovered, reaching $9.99 billion in 2005 and $10.65 billion in 2006. From 2004 to 2005, shipments grew between 6 and 7 percent. Figure 156 presents 16 years worth of U.S. office furniture industry shipments. The fortunes of this industry follow the general economy very closely.
Globalization has had a mixed impact on U.S. furniture makers. These manufacturers have seen their exports grow with the spread of globalization and increased demand for office furniture in parts of the world where demand for these products had been low. At the same time, imports of furniture to the United States have grown rapidly. In 2006 office furniture imports to the United States exceeded exports by a factor of more then 8 times—total exports were $3.7 billion and imports were $30.8 billion, 98 percent of which were wood products according to the U.S. Commerce Department's International Trade Administration.
Environmental concerns are another issue that has played a role for office furniture makers during the late 1990s and the first decade of the 2000s. On one side there is increasing pressure on companies to make office furniture out of recycled materials; on the other there is the concern for emissions from chemicals such as formaldehyde used in particleboard products, as well as chemical waste from the manufacturing process.
During the early years of office furniture manufacturing, when wood was the main material used, furniture manufacturing companies were largely based near reliable sources of timber. In the United States, Michigan was one state that had an ample supply of lumber in the early twentieth century, and so the western part of the state became home to such manufacturers as Herman Miller, Inc., Steelcase, Inc., and Haworth, Inc. All three of these companies remain leading office furniture producers at the end of the first decade of the twenty-first century. Other important American companies include HNI Corp., Knoll, and Kimball International, Inc. These and other manufacturers regularly meet and associate with one another through the Business and Institutional Furniture Manufacturers Association (BIFMA).
The leading North American manufacturers, according to 2004 survey carried out by the Business and Institutional Furniture Manufacturers Association are presented in Figure 157. They were HNI (17.6%), Steelcase (15.3%), and Herman Miller (12.9%). In the world market, Steelcase took the lead among U.S. producers with 5.2 percent of total world office furniture sales.
Originally called the Metal Office Furniture Company, Steelcase was founded in Grand Rapids, Michigan, in 1912. Its early specialty was in furniture and accessories made of steel and other metals. Steelcase's first patent, in 1914, was for a steel wastebasket. The next year it came out with a fireproof metal desk, and in 1937 the company debuted an oval desk designed by Frank Lloyd Wright. The company changed its name to Steelcase, which was the name of one of their brands, in 1954, and in the 1970s it was on the leading edge of systems furniture. The 1980s and 1990s saw the company's continued growth as it acquired smaller businesses, and the manufacturer went public in 1998. Rising Internet sales led Steelcase to develop special software called ESync™ in 2000 to help process online orders. Working with International Business Machines (IBM), in 2002 Steelcase created the BlueSpace line that combines technology with furniture in a more integrated design. It also strove to create more environmentally friendly furniture. Steelcase employs 13,000 people worldwide and had an income of $106.9 million on $3.097 billion in sales for the fiscal year ending February 2007.
Founded in Muscatine, Iowa, in 1944, by Clem Hanson, Max Stanley, and H. Wood Miller, HNI Corp. is not only a leading office furniture company, it has also carved out a niche as a leader in wood- and gas-burning fireplaces. Following a strategy similar to Steelcase, HNI, originally HON Industries, has grown over the decades through the acquisition of smaller furniture companies. It was founded on the idea of providing American G.I.'s with a good place to work, and that principle still survives. The company has won numerous awards from magazines such as Industry Week and Forbes as one of the best managed companies and one of the best employer to work for in the country.
This company was established in 1923 by D.J. Depree. Originally a manufacturer of residential furniture, the company expanded into office furniture by the 1950s, working with industrial designers to create new concepts. Herman Miller developed the Action Office panel system by the 1960s and added ergonomic furniture to its products by the 1970s.
Another notable U.S. office furniture manufacturer is Haworth, Inc. It was founded in 1948 under the name Modern Products by G.W. Haworth. The company began to specialize in office environments by 1954 and was one of the early developers of partitions that led to office panel systems. It changed its name to Haworth, Inc. in 1976, and by 1980 it was manufacturing office chairs and other seating. The focus of the company since then has remained on the office environment as a whole. The company exceeded $2 billion in sales in 2000 and employs 8,000 people in over 120 countries.
This company is somewhat unique among office furniture manufacturers. Innovative design has long been its hallmark, so much so that it opened its own museum in 1997 to display its artistic-looking furniture. Founded by the German-born Hans Knoll, the company was established in New York City in 1938. As early as the 1940s Knoll was raising eyebrows with its futuristic take on office seating and tables. The company hired such designers as Eero Saarinen, Abel Sorenson, Isamu Noguchi, Emanuela Frattini, and Carl Magnusson, creating such memorable pieces as scissor and womb chairs and tulip tables.
Internationally, the next leading producer of office furniture after the United States is Japan, where Kokuyo and Okamura are the top manufacturers. Kokuyo International Co., Ltd., based in Osaka and with offices in Germany, the United States, China, Thailand, India, and Malaysia, has emphasized comfort and pleasant work environments in its products. Okamura, founded in Yokohama City, began its business by selling garden furniture after World War II. In its early years, it also sold torque converters, small aircraft, and even automobiles. It entered the office furniture industry by the mid-1960s, beginning with metal furnishings, and also made storage furniture for the home and desks for schools. A remarkably foresighted innovation came in 1964, when Okamura created the first online office furniture system. Five years later, they also developed special furnishings for computer server rooms. Over the years, they have developed frozen and refrigerated showcases for grocery stores and for other displays, such as clothing.
MATERIALS & SUPPLY CHAIN LOGISTICS
Although wood is still used in many designs, office furniture these days is made of a wide variety of materials, including metals, plastics, glass, and textiles. The cost of these materials was nearly $11.25 billion in 2005, up from $9.59 billion in 2002, according to the 2002 Economic Census, with total value of shipments that year of $26.32 billion, up from $23.38 billion in 2002. The Census Bureau splits materials between wood and non-wood office furniture, with materials for wooden furniture costing companies $1.076 billion in 2002, and all other types costing $3.006 billion that same year. This was down from a high of $1.787 billion for wooden furniture in 2000 and $3.306 billion for non-wooden furniture in 1997 because of lower production. By 2005, however, supplies for all office furniture, excluding fixtures, cost manufacturers $4.925 billion on total sales valued at $12.79 billion. Non-wooden furniture supplies have seen the highest increase in materials expenses over this period, much of this due to rising steel prices.
Among materials consumed by the U.S. office furniture industry in 2002 were hardwood plywood ($68.6 million), particleboard ($63.5 million), hardwood veneer ($49.5 million), plastic laminates ($61 million), steel sheets and strips ($340.8 million), plastic furniture parts and components ($275 million), and furniture and builder's hardware such as casters, hinges, handles and glides ($345.5 million).
Globalization and increased demand for commodities from booming economies such as China's have led to supply complications. For example, in 2000 Chinese steel imports to the United States represented 5 percent of all steel imports, but by 2004 they made up 23 percent. The U.S. government agreed to remove tariffs from Chinese steel in order to ease costs for domestic manufacturers who consume a large quantity of steel. As one manufacturer, Herman Miller, reported in 2005, the result of rising costs has been an annual increase of $5 million dollars to purchase steel. Other materials, including particle board, are also on the rise. Demand for wood was great during the strong housing market of the early 2000s. Record hurricanes along the Gulf of Mexico in the late 1990s and early 2000s also increased demand for commodities like wood, steel, and chemicals.
Employment, meanwhile, has declined in the sector since 1989, when 71,300 people worked in the office furniture industry. Manufacturers operate their own assembly plants, so employment at office manufacturing companies includes both factory and office workers. By 2002 employment was down to 34,000. Part of the decline has been attributed to the economy, rising health care costs, and automation which has also supplanted some of the workforce.
Very large corporations and institutions often buy office furniture directly from the wholesaler and under retail prices. A robust retail network services the smaller buyers through storefronts and increasingly, through catalog sales and e-commerce Web sites.
Office furniture for the home is often purchased in the same fashion used by small companies. However, people often like to see and feel a piece of furniture that will be placed in their homes, thus, the retail storefront is an important distribution channel for home office furniture buyers. Standard office furniture offerings are available from the large office supply chains such as Office Depot, OfficeMax, and Staples. Mass merchandisers, too, make some office furniture available and the growth of home office furniture has brought this type of furniture into furniture stores that used to focus on the home. In fact, the customer who is looking for a high-end, solid wood office suite or executive desk will typically visit a quality home furnishing store that has an office furniture department.
The traditional users of office furniture have been corporations and small businesses. In more recent years, however, home office furniture has become a growing niche as more and more employees spend at least part of their time working in their houses and apartments. Internet connections and e-mail have made telecommuting easier. This can be a positive development because employees can save money on unnecessary commutes. Some workers, however, have found technology a burden as their supervisors increasingly insist on their being available after hours or even while on vacation.
In a 2007 report from the International Telework Association and Council, it was reported that 26 million Americans telecommute to work at least part of the time. This number is expected to increase to 100 million by 2010. While much of this work is done by phone or through the use of personal digital assistants (PDAs) and other electronic organizers, Americans are also increasingly setting aside space in their homes for offices. This phenomenon has also increased the market for ready-to-assemble furnishings, a specialty of such companies as Sauder Woodworking and O'Sullivan Industries.
As the nature of work done in the office has changed over the decades, so too have the needs of people in some occupations who need furniture to suit these unique needs. The furniture industry has recognized this trend in two particular sectors: education and health care. With regard to education, the philosophy of teaching in the United States has changed considerably in recent years. No longer are students expected to remain at their own desks to read or work on assignments. Instead, a much more interactive atmosphere has emerged in which students work together in groups on problem-solving projects and may use computers as a part of this collaborative work. As a result the classroom environment is beginning to resemble the modern office workstation setting with conference rooms that include multipurpose furniture designed for small groups. Studies indicate that students learn better by interacting in groups and with their instructors, and new furniture design for the classroom thus encourages such interactions. Steelcase's LearnLab is one example of new classroom furniture design.
In the health care sector companies such as Herman Miller have been emphasizing modular products that are flexible in the hospital and clinic environments, thus, they can be adapted to work in administrative offices, laboratories, critical care units, doctors' offices, and waiting rooms.
RESEARCH & DEVELOPMENT
There have been a number of developments over the years that have affected office furniture and its design. One of the most significant, of course, has been the entrance of the computer into the work environment. Beginning in the late 1980s, electronic technology had largely supplanted the typewriter and adding machine. Furniture had to be created to house CPUs, provide access for additional wiring, create new storage designs for diskettes and CD-ROMs, and provide ways to adjust keyboards and monitors for proper viewing.
As people spend more time at their desks, partly as a result of the computer revolution, there has been an increase in the incidents of back, neck, arm, hand, and eye strain. Carpal tunnel syndrome, which is caused by stress from typing, especially when the wrists are incorrectly positioned, has been an increasingly common injury for the office worker. To resolve such problems, office furniture manufacturers have developed ergonomic, or adjustable, furniture. This trend was spearheaded by such inventors as Bill Stumpf and Don Chadwick, who were innovators in chair design. The creation of the Ergon chair, followed by Chadwick and Stumps' Equa and Aeron chairs, was initiated by the desire to make a chair that was perfectly suited to the human body. By sitting more naturally, less stress is put on the back, shoulders, legs, and arms with these adjustable chairs.
Desks, have also become adjustable for the individual user, with keyboard platforms, monitor mounts, and even entire tables being designed that can be raised and lowered as needed. A company called AnthroCorp has even created an automated system that uses electric motors to adjust desk components. Entire office spaces are now adjustable with such inventions as Haworth's Vertical Office Panels, which permit entire office spaces to be created or removed in minutes to create spaces for any number of business purposes.
Environmentalism has been an increasing concern for furniture companies since the 1990s, both during the manufacturing process and in the final product. During manufacturing, factories have typically produced toxic wastes, and finished products have been known to emit invisible emissions from chemicals such as formaldehyde. The U.S. government's Green Building Council consequently established the Leadership in Energy and Environmental Design (LEED) standards for the following categories: indoor environmental quality, materials and resources, water efficiency, energy and atmosphere, sustainable sites, and design processes. Credits are awarded in each category to a company that proves its environmental soundness, with a score of 21 earning LEED-CI certification.
Reducing chemicals, using recycled materials, and running factories on less energy are some of the ways that furniture manufacturers have striven to meet these guidelines because they know consumers want the companies they purchase products from to be environmentally friendly.
TARGET MARKETS & SEGMENTATION
In industrialized nations the majority of people with a job use office furniture of some kind. The market for these furniture pieces can be broken into four groups: businesses, government agencies, institutions and organizations, and home users. The needs of the first three groups are essentially the same, with furniture needs being designed for groups of workers, such as are seen in large offices partitioned into cubicles, and private offices for middle or upper managers. Home office clients are quite different. They are typically seeking office furniture that fits in with their home decor, or, if on a tight budget, they might seek furniture that is merely cheap and functional, such as ready-to-assemble pressboard pieces.
With electronic devices such as laptop computers, BlackBerries, and PDAs, many people involved in office work are conducting their business on the go. They may be found vacationing on beaches and checking their e-mail, or talking to clients on cell phones while driving, or scheduling meetings on their PDAs. But such conveniences have not replaced the traditional office space, nor are they likely to in the near future.
The economies of the industrialized world have been moving away from manufacturing and toward more service and information based activities. This evolution means that a greater number of people work in a symbolic world, manipulating data and information and fewer people doing work that requires the manipulation of materials like steel and wood. Office furniture plays its largest role in the new economy, where information is the commodity and work involves its management, organization, and manipulation. Office furniture designers and manufacturers will continue to see their fortunes rise and fall in parallel with the cycles of the economy but they have reason to be optimistic. While they are involved in what is commonly referred to as the old economy of manufacturing, their customers are most active in what is seen as the new economy.
RELATED ASSOCIATIONS & ORGANIZATIONS
Business and Institutional Furniture Manufacturers Association (BIFMA), http://www.bifma.org
Furniture Industry Research Association (FIRA), http://www.fira.co.uk
Independent Office Products and Furniture Dealers Association (IOPFDA), http://www.iopfda.org
Office Furniture Distribution Association (OFDA), http://www.theofda.org
Office Furniture Recyclers Forum, (OFPF), http://www.ofdanet.org
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"Office Furniture." Encyclopedia of Products & Industries - Manufacturing. . Encyclopedia.com. (March 16, 2019). https://www.encyclopedia.com/manufacturing/encyclopedias-almanacs-transcripts-and-maps/office-furniture
"Office Furniture." Encyclopedia of Products & Industries - Manufacturing. . Retrieved March 16, 2019 from Encyclopedia.com: https://www.encyclopedia.com/manufacturing/encyclopedias-almanacs-transcripts-and-maps/office-furniture
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