HIGH POINT – Residential furniture orders in December rose 6% by the dollar over last year, according to accounting firm Smith Leonard, which surveys furniture manufacturers and retailers every month in its Furniture Insights report. Despite a rise though, orders rose less than they did in November (which was 26% higher) as well as the previous six months, all of which saw double-digit increases. Orders in November were higher for two-thirds of survey participants.

Shipments for the month were down 4% from last November. For the year up through November, shipments are down 17% from 2022.

“So despite recent improvements in new orders, trends continue to be affected by many companies shipping from their historically high backlogs through much of 2022,” said Mark Lafierre, assurance partner at Smith Leonard. “Accordingly, December 2023 backlogs were down 5% from November 2023 and down 33% compared with December 2022.

Receivable levels were down 12% from last November, reversing the apparent 5% timing difference increase from the prior month. Inventories and employee levels are again in line with prior months, but down from December 2022, indicating that companies have substantially adjusted levels to match current operations.

Lafierre gave his thoughts for the year.

“Economic indicators, as well as our monthly stats, continue to provide mixed results and accordingly, expectations for 2024,” he said. “Overall consumer confidence took a step back in February 2024, which seems at odds with positive economic data such as steady employment, diminishing inflation and a strong stock market.

“Housing is also showing some signs of life despite the current interest rate environment, and although expected to come slowly and methodically, there appears to be help on the way in the form of mid-year interest rate cuts from the Fed that should drive additional housing and furniture sales activity.

“Consistent with many economic reports, the Conference Board is no longer forecasting a general recession for 2024, though we know the furniture industry tends to move at its own pace.

“People we’ve spoken to recently within the industry are largely cautiously optimistic about 2024 and that recent trends and positive outlooks for the coming year will outweigh the negative factors associated with the election and international concerns that seem to dominate the news cycle.”

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