From Home Furnishing Business
March Furniture Orders up 9%
New orders for furniture rose 9 percent in March compared with the same month last year, according to the latest Furniture Insights survey of residential furniture manufacturers and distributors.
Year-to-date, new orders were 3 percent ahead of the first three months of 2013. Around half of participants in the monthly survey by High Point accounting and consulting firm Smith Leonard reported increased orders for the three-month period, with several reporting double-digit growth.
Shipments also increased in March, up 10 percent over March 2013; and up 21 percent over February, likely a result of one more shipping day, but also better weather for truckers to take loads out or deliver. Around 80 plus percent of survey participants reported increased shipments over March 2013.
Year-to-date, shipments were up 4 percent over the first quarter of 2013, up from 1 percent reported last month. A little more than 60 percent of companies surveyed reported year-to-date increases, some with nice double-digit gains, though some that continued to report double-digit declines.
Backlogs remained strong, 14 percent from March 2013, the same as reported in February. Backlogs increased 2 percent over February.
Receivable rose 8 percent above March 2013, in line with the 10 percent increase in shipments.
"Receivables were up only 4 percent over February in spite of the 21 percent increase in shipments, so timing was likely a factor," Smith Leonard Managing Partner Ken Smith said in the survey report.
March inventories were down 2 percent from February levels; were 5 percent higher than March 2013, down from a 6 percent increase reported for February. Inventories continue to be in line with current business conditions.
Factory and warehouse employment in March was even compared with February; and 5 percent higher than March 2013, the same as reported last month; and are in line with current business conditions.
Factory and warehouse payrolls rose 11 percent over March 2013, and were up 12 percent from February. The increase from February probably resulted in one more working day and probably fewer weather days. Year-to-date, factory and warehouse payrolls remained 8 percent ahead of last year and while appearing a bit high, the percent has remained in line. This probably results in the higher increases in upholstery business versus case goods when we have more imported goods that does not increase as much with volume as it does in upholstery.
In summary, Smith noted that there are wide variances reported from survey participants in both orders and shipments.
"Some are reporting nice double-digit increases while others are reporting, in some cases, double-digit declines," he said.
Smith attributed March's overall positive results to a severe winter finally easing up around the country.
"Consumer confidence, while still a bit soft, seems to continue to improve, though still up and down slightly," he added. "Even with the ups and downs, the trend line continues to be on a positive line.
"Housing results are mixed, though at least out of the depths of the recession. Most of the other national news remains mostly positive. The economic indicators remain positive and results for durable goods are also positive. Unemployment continues to decline. While we did not see much GDP growth in the first quarter, most believe that was mostly weather related and believe we will see much stronger growth for the rest of the year."
Barring unforeseen national or international occurrences, Smith sees no reason for anything but positive industry results for the rest of the year.