New orders for furniture in February rose 4% from the same month last year according to the latest Furniture Insights survey of residential furniture manufacturers and distributors from High Point accounting and consulting firm Smith Leonard.
Year-to-date, orders are up 2% after flat results in January, and were up for 58% of the participants.
“The good news was that orders in February were up for two-thirds of the participants,” said Smith Leonard Partner Ken Smith in the report.February shipments rose 3% over February 2016 and were up 1% from January. Last year in February, shipments were up 3% over the same month in 2016. Year-to-date, shipments were up 3% with some 61% of the participants reporting increased shipments.
Backlogs were stable for the month of February with the results being just slightly higher than last year. Last year, February backlogs were down 3% from February 2015.
Receivable levels, up 5%, were a bit higher than the 3% increase in shipments for the month, as well as year-to-date.
“Overall though, based on results for some time now, receivables generally appear to be in pretty good shape,” Smith noted.
Inventory levels fell 3% from February 2016 as well as 3% from January. February 2016 levels were up 5% from the previous year, so it appears that participants are getting inventories in line.
“Overall, the factory and warehouse payrolls and employee levels seem to be back in line with current conditions after some unusual results last month,” Smith said.
In summary, Smith said that based on our conversations at the High Point market, recent results have been mixed.
“We used the term ‘spotty’ at times though we thought that might be a bit negative, yet many agreed with that term,” he said. “With that said, overall we felt that the market was a good one. Some seemed to think traffic was down, but many we talked to, said their showroom traffic was up. Even though some said their traffic was down, those folks said it was a great market.
“The April market was an unusual one for sure. In all our years, we did not recall an April market where it rained three days straight. Actually a few times, it didn’t just rain, it poured. But the transportation system did its job, at least for us, and we felt that most people got around pretty well.”
He added that the overall U.S. economy, according to the advance reports on GDP, started the year rather sluggish.
“We are not really certain why unless it relates to the lack of cooperation in Congress keeping things from happening,” Smith said. “The reality is that overall things are still pretty good. Interest rates are still low in spite of a few raises in rates expected. The stock market is good, housing is good and despite a small drop in consumer confidence this month, the indexes are still very strong. We continue to expect 2017 to be a good year for the residential furniture business.”