Furniture orders show slight dip
November was a bit of an off month in the furniture industry, most likely because of market dates.
According to the monthly newsletter Furniture Insights released by Smith Leonard, new sales in November were down 1 percent from the previous year and 4 percent from October.
“Monthly comparisons around the High Point Market dates are sometimes a bit misleading due to timing of Market and related orders written,” said Ken Smith, an accountant and author of Furniture Insights.
November 2011 orders were up 13 percent over November 2010, but the October 2011 Market ended on Oct. 27.
“Obviously, all Market orders were not written by the end of October and some fell into November,” Smith said. “This year, Market was a bit earlier in October, so we imagine that has had some impact on the monthly results.”
New orders remain 5 percent ahead of 2011, year-to-date.
Shipments ticked up in November. Shipments in November were up 3 percent over November 2011 as well as 3 percent over October. Year-to-date, shipments remain 6 percent higher than in 2011.
“Last November (2011), shipments were 10 percent higher than November 2010, so we are comparing to a relatively strong month last year,” Smith said.
Backlogs, in November, were 8 percent higher than November 2011, down from a 15 percent increase reported last month.
Smith said receivables, inventories, factory and warehouse employees and payrolls all seem in line with his expectations based on current volume levels.
“As much as business in general does not ‘feel’ that great, we seem to keep plugging along,” he said.
Consumer confidence fell so significantly in November that all gains for 2012 were lost. Smith said this was most likely due to elections on the national, state and local levels.
Smith attributes the furniture industry “hanging in there” to home sales.
“We think the significant pickup in housing has to be having the most impact. Existing-home sales in 2012 were the highest in five years,” Smith said. “More housing sales create demand for furniture. Better prices mean fewer people worried about being upside down in their mortgage. And tighter lending means that those who are buying new homes have more room in the budget for furniture versus being up to their neck in mortgage payments.”
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