'We've got to come out of this sometime'
Gary Evans, Senior editor -- Furniture Today, 11/24/2008 12:00:00 AM
Looking back over the last Furniture/Today Retail Planning Guide, which came out at the end of 2007, most of the people we asked to make predictions about 2008 said it would be both difficult and slow.
Those forecasts turned out to be oh, so true.
Old-timers say the industry is going through the worst down cycle they've encountered since the early '70s, when rising prices and a super-slow economy caused economists to coin the term “stagflation.”
I wasn't in the industry in those days, although I remember them well as a cub reporter for a daily newspaper. That was the time you could read a whole book while sitting in long lines waiting to get gas — hoping you didn't run out before you reached the pumps.
Particularly hard was 1973, when Syria and Egypt attacked Israel. There was a backlash of support from the United States and other western countries, which in turn caused Arab oil exporters to retaliate and impose an oil embargo, making gas scarce. As for selling furniture, the old-timers say it was bad, really bad.
I was in the industry in the early '80s, however, when the country went into a deep recession. Bankruptcies rose 50%, and in the furniture industry weaker companies were dropping like flies in a spray of Raid. It was so bad that we here at the paper joked about having a standing column listing all who had gone under during the week.
What started this backtracking though the decades is that recently somebody made a similar — and clearly facetious — suggestion that we publish a paper called Bankruptcy/Today.
Although the '70s were bad, they're dim in most of our memories. But those who remember say this downturn may be even worse than that of nearly 40 years ago.
I'm expecting those queried about their expectations for next year to worry about tight credit, the housing crisis, oil price fluctuations, the screwed-up economy, crashing stock markets and consumers who are reluctant to spend more than $5 (even Starbucks has its troubles).
But this industry has an optimistic bunch, despite its cyclical nature. As one sage said, “We've got to come out of this sometime.”
That we do. We eventually came out of the pits of the '70s and '80s with periods of sustained growth. We weathered another cyclical dip in the '90s. We overcame the perils of Y2K and survived the dark days after Sept. 11, 2001.
I expect optimism to creep into the predictions of industry execs as they talk about expecting things to get better. Just when that will be is unknown, but my guess is that the answer will be … the sooner the better.
Opinion columns are available online at www.furnituretoday.com.
