New orders for residential furniture dropped 7% in August compared to 2023 figures, continuing the trend of year-over-year declines in growth, according to the October issue of Furniture Insights. Approximately 40% of the survey participants, reported increased orders in August compared to a year ago.

However, on a positive note, new orders were up 12% compared to July figures., and are up 1% for the year-to-date, "though that spread has continued to narrow with the last four months’ declines," said Mark Laferriere. assurance partner at Smith Leonard, which produces the monthly report.

August shipments were down 10% compared to 2023 figures, but up 14% compared to July 2024. Compared to August 2023 figures, shipments were down for approximately 83% of the survey participants. Year to date through August 2024, shipments are down 8% compared to the same period of 2023. Backlogs were down 10% compared to August 2023, and down 5% from July 2024.

"Receivable levels were up 6% from July 2024, but down 5% from August 2023, both of which are in line with the respective shipment trends," Laferriere noted. "Inventories were consistent with July 2024 and down 11% from August 2023, which is in line with prior periods and current operational levels."

On a seasonally adjusted basis, sales at furniture and home furnishings stores down down 1.4% in September from the previous month, and also down 2.2% from September 2023. Sales were also down 5.1% for year to date September 2024 compared to the same period for 2023 on an unadjusted basis, the analyst reported.

This latest report by Smith Leonard was released following the Fall Furniture Market in High Point, North Carolina.

"While the Market Authority reported that traffic was down slightly, the mood of market seemed to be largely positive, though the U.S. elections and potential for tariffs were also on many people’s minds," Laferriere said.

"Generally speaking, of the companies we visited with, those with more significant designer customer bases seem to be faring better at the moment as the retail business continues to be challenging."

He added, "Certain economic factors do seem to be slowly inching in the right direction, though most people we spoke to, as well as thought leaders in the industry, believe that an increase in housing inventory and activity will be needed for the industry as a whole to fully recover.

"However, this is all nothing new for the industry and most companies have figured out how to survive and even thrive in the current environment as they await a return to normalcy, hopefully by the middle of 2025."

For the full report of the October issue of Furniture Insights click here.

Source: smith-leonard.com