Furniture Insights  

US Furniture Insights

Kenneth D. Smith, CPA, Smith Leonard PLLC

Executive Summary of May 2015 issue of Furniture Insights Report

According to our latest survey of residential furniture manufacturers and distributors, new orders in March 2015 increased 2 percent over March 2014, following an 8 percent increase reported last month. The 2 percent March 2015 increase was compared to a 9 percent increase for March 2014 compared to March 2013.

Year-to-date, new orders were 5 percent higher than the first quarter of 2014, when they were 3 percent higher than the first quarter of 2013. New orders year-to-date were up for 68 percent of the participants. Shipments in March were 4 percent higher than March 2014. Year-todate, shipments were up 8 percent over last year. Shipments were up for 72 percent of the participants. Backlogs were up 9 percent over last March, down slightly from 11 percent last month, but remained at pretty solid levels.

Receivables continued to be in good shape at 6 percent higher than March 2014, but very much in line with the increase in shipments. Inventories were 6 percent higher than March 2014, also in line with current business conditions.

Factory and warehouse payrolls were up 6 percent from last March. The 13 percent increase over February was mostly related to extra working days in March. The number of employees was up 2 percent over last year. In many areas of manufacturing, workers are still hard to find. Many employers have started working with community colleges to attempt to bring more people into the workforce.

On a national level, consumer confidence picked up a bit in May after declining in April. We need it to continue to improve before all the negative presidential campaigns start – telling us how bad things are. Housing continues to improve despite a slowdown of existing home sale in April. Properties continue to sell at faster paces than any time since July 2013. Prices continue to go up – up 8.9 percent over April 2014.

New house sales were up 6.8 percent over March and 26.1 percent over April 2014 and solid in all areas of the country except the Northeast. Single-family housing starts were up 16.7 percent over March 2015. So the all important housing results continue to be favorable. This should continue to help furniture sales and should help case goods, which has been slower to recover than upholstery.

Retail sales in April overall were up slightly over last year. Sales at furniture and home furnishings stores were up 4.6 percent year-to-date in 2015. Gas prices seem to be all over the place. We even had some news articles locally on the difference in prices just in High Point alone. Overall, business seems to be good for most in the industry.

According to another private survey we do, even case goods had a pretty good first quarter. The employment picture remains fairly strong, so that should continue to bolster consumer confidence. Hopefully, the great attitudes we saw at market are continuing to be felt out in the retail world.