by Inflation weighs heavy as demand slows
WASHINGTON — January sales for U.S. furniture and home furnishings stores were up 2.7% as consumers’ appetite for the industry’s products appears to be slowing, at least in relation to other retail sectors.
Estimated furniture sales increased to an estimated $12.43 billion, up from $12.10 billion in January 2020, according to the latest Department of Commerce report. Sales were up 7.2% from December 2020 sales, which the government revised down to $11.60 billion from the previous $11.80 billion estimate.
The latest report sends mixed signals about the furniture sector. On one hand, the year-over-year increase of 2.7% was one of the weakest gains of any retail sector tracked, and it was well below the 13% YOY increase for all retail and food service sectors combined. On the other hand, the industry’s 7.2% increase over December was among the highest sector increases, topped by only non-store retailers, up 14.5%, and department stores (a subset of general merchandise stores), up 9.2%.
Combined retail and food services sales in January were $649.8 billion, DOC said, up 13% from the same month a year ago and up 3.8% from December. Retail trade sales alone increased 11.4% YOY and were up 4.4% from December — sort of the reverse of what happened in the furniture sector, a big YOY gain but a low single-digit gain over the previous month.
The latest industry results could be seen as more confirmation of what furniture retailers have been saying for some time now. Last year was a record year. Part of this had to do with inflation. Now consumer demand and inflation are battling it out, and inflation appears to be getting the upper hand, lifting sales a bit, but putting a curb on traffic.
More from the January report:
The top YOY gainer was gasoline stations, up 33.4%, another indication that this has a lot to do with inflation. Next was restaurants and bars (coming back from Covid restrictions), up 27% YOY, and then clothing and clothing accessories stores, up 21.9%.
The only sector in negative territory compared to January last year was the seller of those other big-ticket home items — electronics and appliance stores, down 2.9% from January 2021.
Sales for non-store retailers — primarily e-commerce companies but also catalog retailers — were up 8.4% YOY.
For a three-month period ending in January, furniture and home furnishings store sales were up 9.3% from the same period a year ago. All sectors combined saw a 16.1% gain, and the increase for non-store retailers was 10.5%.
