HIGH POINT — Smith Leonard‘s survey results for March 2023 show that new orders fell 14% from March 2022 levels. The survey of furniture manufacturers and distributors also showed that new orders were down for 71% of the participants.

Year-to-date, new orders were down 18% compared with the first quarter of 2022, as reported by 78% of the participants.

Ken Smith, co-founder and assurance partner of Smith Leonard, said, “Shipments were down 16% from last March and down 19% year to date. For the month, shipments were down 61% and down year-to-date for 56% of the participants.

“Several participants are continuing to ship from healthy backlogs, while others have brought backlogs down to more normal levels and are shipping from current order rates, reversing the trends we had seen when orders were down but shipments up.”

He noted that backlogs are down 63% from March 2022 and down 6% from February. Because some of the participants continue to have larger backlogs, overall backlog total dollars remain higher than pre-pandemic, but he expects that much of the increase is likely due to price increases.

“Receivable levels remain in line with the decrease in year-to-date sales, but we continue to hear that there is some slowdown in the quick payments that were received when there was a shortage of goods deliverable,” Smith said. “Inventory levels declined again and were down 5% from March 2022.”

Smith believes that employment figures coming down is attributable to marginal employees being hired despite their experience or skills.

The overall economy is slower with the GDP for the quarter reflecting this. He said larger backlogs have helped survey participants to log decent sales, “but as new orders continue to be less than shipments, sales levels will soon decline as many have already seen.”

Smith concluded by noting that “As employment levels remain strong, we hope the recession, if it is coming or has already, is one that is short-lived and not very deep or ‘mild’ as some have described.”

Smith believes that employment figures coming down is attributable to marginal employees being hired despite their experience or skills.

The overall economy is slower with the GDP for the quarter reflecting this. He said larger backlogs have helped survey participants to log decent sales, “but as new orders continue to be less than shipments, sales levels will soon decline as many have already seen.”

Smith concluded by noting that “As employment levels remain strong, we hope the recession, if it is coming or has already, is one that is short-lived and not very deep or ‘mild’ as some have described.”

Source: https://www.furnituretoday.com/