by Furniture shipments fell 16% in March, following new order rates more closely
HIGH POINT — New furniture orders and shipments were down by double digits in March from the same month last year, according to the latest Furniture Insights report published by Smith Leonard.
New orders in March totaled $2.2 billion, down 14% from $2.6 billion in March 2022. About 71% of survey participants said that new orders were down compared to last year.
To put things into perspective, new orders in March 2022 were down 26% from March 2021, which were up 96% over March 2020, the report said, adding that March 2020 orders were down 29% because of a short month of operations at the onset of the pandemic.
Year to date, orders fell 18% to $6.2 billion, compared to $7.5 billion for the first quarter of 2022, and were down for 78% of participants.
Compared to February, they were up 9.3% from $2.05 billion.
Shipments fell 16% to $2.9 billion in March, compared to $3.5 billion in March 2022, and were down for 61% of participants. For the first quarter, they fell 9% to $7.7 billion, from $8.5 billion for the first three months of 2022, and were down for 56% of survey participants.
Compared to February, shipments were up nearly 19% from $2.4 billion.
Backlogs were down 63% in March, to $3.2 billion, from March of 2022 and were down 6% from February.
“Backlogs have continued to fall, so shipments are starting to follow new order rates more closely,” the report noted, adding that overall backlog dollars remain higher than pre-pandemic, but “we would expect that much of the increase is due to price increases.”
The report went on to note that receivable levels fell 22% from March 2022, “somewhat reflecting the decrease in shipments of 9% year to date. We continue to believe that receivables will need to be watched closely as sales at retail continue to slow for many, putting pressure on cash. Fortunately, most have taken advantage of the PPP (Paycheck Protection Program) money as well as the Employee Retention Credits, allowing most to build cash during all this time of the pandemic.”
Inventory levels fell 5% from March 2022 and were down 3% from February, the report noted.
“We expect that while, with business slowing, inventory levels will remain somewhat high as many are not taking chances on shortages, due to problems created during the pandemic,” the report said.
It said the number of factory and warehouse workers was down 6% from March 2022 and down 1% from February. It attributed this largely to attrition “as most companies were hiring anyone they could find during the run-up in business.”
