HIGH POINT –– New orders for residential furniture dropped 20% in September 2021 over September 2020, according to Smith Leonard in its latest Furniture Insights survey. But the decline isn’t as alarming as it sounds.
“The results of our monthly survey of residential furniture manufacturers and distributors once again requires explanation,” said the Smith Leonard report. “At first glance, the September 2021 results would be alarming, but one has to look beyond the first glance. New orders in September 2021 were down 20% from September 2020, but the look beyond showed that September 2020 orders were up 43%. So we looked to compare 2021 with 2019 and found that September 2021 orders were up 15% over 2019.”
Year to date orders were up 21% over 2020 and up 32% over the first nine months of 2019.
Shipments were only up 4% over last September, but year-to-date shipments were 30% higher than the same period a year ago. Shipments were up for 91% of the participants. Most of the participant’s shipments have been delayed by lack of workers to manufacture, supply chain issues for domestic manufacturers, as well as supply chain for imports, whether lack of goods or freight issues.
With that, backlogs continued to grow, up 56% over September 2020, which were up 123% over September 2019. These high backlogs are worrisome for most, but consumers seem to hear the same story over and over, so they appear, while frustrated, to be getting used to delays.
Participants revealed that receivable and inventory levels seem adequate, even with inventories a bit high. The idea seems to be more worry about having inventory to sell vs. control of inventory.
The number of factory and warehouse employees continues to be an issue or rather the lack of those employees. This seems to be true whether warehouse or manufacturing.