Furniture Insights: High Point Market Dates Affect April Orders

July 1, 2007  by in UnCategorized   

By Home Furnishings Business in on July 2007 Retailers ordered 12 percent more merchandise from furniture manufacturers and distributors in April 2007 than the same prior-year month, but there’s no reason to get too excited, according to Furniture Insights, the monthly industry report from the High Point-based accounting and consulting firm Smith Leonard.

While this year’s April numbers looks like great news, they compare to a 13 percent decrease last year when comparing April 2006 to April 2005, and Smith Leonard credited those swings to High Point Market dates: In 2006, the April market dates were April 27-May 3; and the 2007 April dates were March 26-April 1. It appears that April 2006 market orders were captured in May 2006 while the April 2007 market orders were recorded in April.

That led to a revision to some prior months’ numbers that were previously reported on the year-to-date orders and shipments. The first-quarter orders were down 7 percent compared to the first quarter of 2006. With April’s increase, new orders were off only 3 percent but Smith Leonard expects a decline in May if assumptions about market orders are correct.

Shipments in April were 4 percent lower than April 2006 continuing to reflect lower order rates. Shipments were 12 percent below March levels, a fairly normal number.

Year-to-date, after reflecting the revisions noted above, shipments were 7 percent lower than the first four months of 2006, which is fairly in line with the reduced orders through March.

Similar to last month’s report, shipments year-to-date were lower for 72 percent of the participants. Backlogs were 3 percent higher than last April and 1 percent higher than March 2007.

Receivables were 5 percent lower in April compared to April 2006 but were even with March levels even with the decline of shipments from March to April. April over April, shipments declined 4 percent.

Inventories were 9 percent lower in April 2007 versus April 2006, compared to 6 percent last month. Inventory levels dropped 1 percent from March. These levels seem to indicate that, at least at the manufacturer/distributor level, inventories remain in reasonably good shape.

Factory payrolls were 8 percent lower than April 2006 compared to an 11 percent decline in March compared to March 2006. The number of factory employees dropped 15 percent from April 2006 levels. The 15 percent decline was the same as the decline reported in March.