December 23,
2015 by in General 
This is the final factoid in a series of four factoids exploring the impact of consumer confidence on a rising demand for consumer products, especially durable goods. Consumer confidence, measured monthly by The Conference Board, is “a barometer of the health of the U.S. economy from the perspective of the consumer”.
A major piece of the consumer spending pie is housing, especially new home sales. Economic conditions drive the homebuilding industry and once building slows, it takes a while for housing starts to catch up once the consumer starts to regain confidence.
New Home Sales plummeted alongside Consumer Confidence as the Housing Industry went bust during the Recession taking almost two years to bottom out after the confidence began to recover. A drop of 61 percent in New Home Sales occurred from 2007 to 2011. As the confidence in the economy picked up, Housing Starts ignited and New Home Sales are finally on a steady rise – growing 68 percent from 2011 but still only reaching a 66.2 index in 2015 YTD. Existing Home Sales also felt the effects of a decrease in Consumer Confidence – dropping down to 74.1 index in 2010, but were quicker to recover due to an already present housing inventory.
Source: The Conference Board: Consumer Confidence Index, U.S. Census Bureau
December 18,
2015 by in General
This is the third in a series of four factoids exploring the impact of consumer confidence on a rising demand for consumer products, especially durable goods. Consumer confidence, measured monthly by The Conference Board, is “a barometer of the health of the U.S. economy from the perspective of the consumer”.
Consumer Confidence is perhaps the prime external driver of consumer spending. Population and household formations form the base for growth in spending; however, Consumer Confidence drives demand, especially when it comes to durable goods.
New Motor Vehicles follows a similar trajectory as Consumer Confidence with personal consumption dropping dramatically from 2007 to 2009 (down 29 percent) before climbing an average of 8 percent to a 2015 YTD index of 119. Also dipping in 2009, although only 15.8 points compared to 29 points for New Motor Vehicles, consumption of Furniture and Home Furnishing items rebounded by 23 percent from 2009 to 2015ytd. After peaking in 2008, the Video and Audio Equipment Industry experienced a slight downturn due to the Recession but overall has been flat for the past 8 years.
Confidence has a lesser impact on non-durable goods, like food and clothing, which tend to avoid the peaks and valleys of confidence swings more so than durable goods.
The next and final factoid in this series will show the relationship between Consumer Confidence and Housing – the other piece of the consumer spending pie.
Source: The Conference Board: Consumer Confidence Index, Bureau of Economic Analysis
December 11,
2015 by in Current
This is the second in a series of four factoids exploring the impact of consumer confidence on a rising demand for consumer products, especially durable goods. Consumer confidence, measured monthly by The Conference Board, is “a barometer of the health of the U.S. economy from the perspective of the consumer”.
Although confidence tends to fluctuate more strongly than actual economic data, the CCI (Consumer Confidence Index) is a lagging indicator in response to several economic catalysts, among them the health of our jobs market, growth in wages, and the overall global political and financial climate.
More than any other indicator, Consumer Confidence tends to mirror the growth in personal income with the CCI responding more sharply to economic downturns. Employment bottomed out in 2010 at an index of 94.4 –6 percent below 2007. (2007 = 100) Since then, the number of employed workers has increased by 8 percent and is currently at an index of 102.5. Personal Income stayed flat during the Recession but quickly gained momentum after 2009 and has increased to 126.8 index – a growth of 26 percent.
Next week’s factoid will show a direct correlation between Consumer Confidence and Personal Consumption, specifically durable goods.
Source: The Conference Board: Consumer Confidence Index, Bureau of Labor Statistics, Bureau of Economic Analysis
December 4,
2015 by in General
This is the first in a series of four factoids exploring the impact of consumer confidence on a rising demand for consumer products, especially durable goods. Consumer confidence, measured monthly by The Conference Board, is “a barometer of the health of the U.S. economy from the perspective of the consumer”. With a surge in Housing Starts, flattening of home electronics, and possible waning of new automobile sales, the Furniture Industry should benefit with the rise of confident consumers.
About 70% of the Gross National Product is consumer spending, and one of the prime drivers of spending is Consumer Confidence. The Consumer Confidence Index increased to 103.0 in September, up from the 2015 low in July of 91. The all-time low in confidence occurred in February 2009 when it fell to a recession low of 25.3. (Source: The Conference Board, Consumer Confidence Index)
Consumer Confidence took a nosedive after a high of 103.4 in 2007 – dropping to an average of 45.4 in 2009. Since the Great Recession, confidence in the economy has steadily increased a yearly average of 9 index points – resulting in a total jump of 53.3 points from 2009 to 2015 year to date (annual average).
Next week’s factoid will show the tie between Consumer Confidence and Employment and how the health of the U.S. job market affects the Consumer Confidence Index.
November 25,
2015 by in General
Total U.S. Imports of Household Furniture by Country 2002 to 2015 YTD
While the furniture industry in China has been threatened over the past few years due to rising labor costs and labor shortages, U.S imports continue to increase from China alongside a growing Vietnam Wood manufacturing presence. The recent devaluing of the Yuan could go a long way to strengthen China’s hold on U.S.
China’s exports to the U.S. have grown to over 60 percent of total U.S. imports – up 20.6 points from 2002 to 2015 Q2. Since the peak of the recession in 2009, the value of imports from China has grown 52.4 percent to $14 billion.
Most noticeable is Canada’s decline alongside Vietnam’s rise. Vietnam jumped from a half percent to over 10 percent of U.S. imports in the past 13 years while Canada has dropped from 18.3 percent in 2002 down to 5.5 percent in 2015 Q2 – a decline of 12.8 points. As the fourth largest importer, Mexico accounts for 4.8 percent of total imports in 2015 Q2 – 0.8 points shy of 2002.
Imports of Wood and Upholstery Household Furniture by Country in Selected Years (Top 4 Countries)
While the furniture industry in China has been threatened over the past few years due to rising labor costs and labor shortages, U.S imports continue to increase from China alongside a growing Vietnam Wood manufacturing presence. The recent devaluing of the Yuan could go a long way to strengthen China’s hold on U.S.
Wood household furniture imports totaled $9.8 billion in 2014 and are up 10 percent in the second quarter of this year compared to 2014. China still commands the Wood category at $3.7 billion wholesale in 2014, but has lost significant share over the last ten years to Vietnam.
Vietnam’s 2014 imports have grown to $2.2 billion, up from only $60 million in 2002. Through the second quarter of this year, China’s Wood imports have grown only 7.0 percent compared to Vietnam’s 23.9 percent, closing the gap even further. Malaysia continues a steady Wood niche but controls less than 6 percent of Wood imports.
Unlike the Wood category, China has virtually no competitors in Upholstered goods in the U.S. marketplace. In the early 2000s China began to make its move with Upholstery imports of only $543 million in 2002 and grew to $3.9 billion by 2014. Essentially China has taken market share from U.S. producers as the secondary countries – Mexico and Canada – have struggled just to maintain shipment levels. Through the second quarter of this year, China upholstery imports are up another 15.2 percent over the same period last year. Vietnam has slowly tried to enter the U.S. Upholstery market, but had only grown to $293 million in 2014.
Source: U.S. Census Bureau, Foreign Trade
Total U.S. Exports by Top 3 Countries 2002 to 2015Q2
Although the United States exports a fraction of furniture compared to imported goods, exports have continued to rise since 2009 and surpass the peak highs of 2007. Well over half of the $3.4 billion in U.S. exports are to Canada. Mexico has steadily increased as the second largest importer of U.S. furniture – up 92% from 2002 to 2014. In the last 13 years, China has gone from 0.7% of total U.S. furniture exports to 3.6% in 2015Q2.
Although exports have been growing, they are not approaching the growth in imports being fueled by China. And while the furniture industry in China has been threatened over the past few years due to rising labor costs and labor shortages, U.S imports continue to increase from China alongside a growing Vietnam Wood manufacturing presence. The recent devaluing of the Yuan could go a long way to strengthen China’s hold on U.S.
Source: U.S. Census Bureau, Foreign Trade
November 19,
2015 by in General
Bedding sales grew to an estimated $3.69 billion in the third quarter, increasing 5.3 percent over the same Q3 last year. Compared to the previous Q2 of this year, sales were up 9.2 percent. Year-to-date, the bedding industry is 6.3 percent higher than the first three quarters of last year.
Note: Previously issued 2015 Q2 estimates have been revised.
Industry Growth Quarter to Quarter 2011 to 2015 Q3 Bedding Industry
Bedding sales continue to show steady improvement quarter over quarter for the last ten consecutive quarters. In the third quarter of this year sales totaled $3.69 billion, up 5.3 percent over quarter three of 2014.
Note: Previously issued 2015 Q2 estimates have been revised.
Industry Sales 2007 to 2015 Q3 Bedding Industry
Third quarter year-to-date bedding sales totaled $10.45 billion, up 6.7 percent compared to the same period last year.
Note: Previously issued 2015 Q2 estimates have been revised.
November 13,
2015 by in General
Third quarter year-to-date furniture and bedding sales totaled $68.59 billion, an increase of 5.4% over the first three quarters of last year.
November 6,
2015 by in Current, General
Note: Previously issued 2015 Q2 estimates have been revised.
Source: Impact Consulting Services, Inc. industry model.
The chart above shows quarter-over-quarter industry performance from 2012 Q3 through the third quarter of 2015.
Third quarter combined Furniture and Bedding industry sales of $23.32 billion were a 5.2 percent improvement over the same Q3 in 2014. Compared to last quarter (2015 Q2) sales improved 1.3 percent
Furniture (excluding Bedding) increased 5.18 percent in 2015 Q3 versus the same quarter last year with sales of $19.62 billion – up from $18.66 billion in 2014 Q3.
Bedding continued steady quarter-over-quarter growth with sales of $3.69 billion, up 5.3 percent over third quarter sales last year.
October 30,
2015 by in General
Note: Previously issued 2015 Q2 estimates have been revised.
Source: Impact Consulting Services, Inc. industry model.
The Industry continued its steady growth in the third quarter increasing 5.2 percent over the same quarter last year. Furniture and Bedding sales totaled $23.32 billion in Q3 which was 1.3 percent over the second quarter of this year.
Furniture (excluding Bedding) increased 5.18 percent over 2014 Q3 but was essentially flat over last quarter (2015 Q2). Bedding sales were also up 5.3 percent over Q3 of last year and grew 9.9 percent compared to the previous quarter (2015 Q2).
October 26,
2015 by in General
Can China’s currency devaluation impact the U.S. furniture industry? Although economists differ on how much the impact will be; China hopes to prevent its economy from slowing further by making its exports less expensive. China already dominates 60.8 percent of household furniture imports to the U.S. and cheaper imports could strengthen that hold.
The world totals of both U.S. imports and exports in the household furniture industry have been on the rise since the Great Recession. In 2014 imports totaled $23.8 billion at wholesale or about 74 percent of U.S. furniture and bedding consumption - this compares to 62 percent in 2007.
Imports to the U.S. experienced high growth (53.6 percent) from 2002 to 2007 before plummeting 24.3 percent by 2009. Since 2009, furniture imports increased to 53.1 percent in 2014 – growing an additional 10.9 percent from 2014 Q2 to 2015 Q2 year to date. And while U.S. exports total just a fraction of imports, exports of furniture have been steadily increasing since the peak of the recession in 2009. Up 50.1 percent since dropping 5.9 percent in 2009, the furniture export industry has increased from $1.5 billion in 2002 to $3.5 billion in 2014 – a jump of 141 percent.
Methodology: Household furniture imports and exports are compiled by the U.S. Census Bureau, Foreign Trade Division from over 200 countries by product type and material.
Source: U.S. Census Bureau, Foreign Trade