Factory orders down 1% in November but stay positive for year
Larry Thomas -- Furniture Today, February 4, 2013
HIGH POINT — New orders for residential furniture slipped 1% in November, but remained in positive territory for the first 11 months of 2012, according to the latest survey of manufacturers and distributors by the Smith Leonard accounting and consulting firm.
The survey showed that orders for the first 11 months of last year were 5% ahead of the first 11 months of 2011, while shipments rose 6% during the same period.
The monthly decline in November, when compared to November 2011, was the first time since January 2011 that orders were reported down from the comparable month the previous year.
Ken Smith, a partner in the accounting firm, said in a newsletter accompanying the survey results that the most recent November figures probably were affected by the timing of the October High Point Market the past two years. The last market ended Oct. 18, 2012, but the previous year, it ended Oct. 27, which probably pushed some October 2011 market orders into November that year.
Smith noted that in November 2011, orders were 13% ahead of November 2010.
"So really, as much as business doesn't ‘feel' that great, we seem to keep plugging along," Smith wrote in his monthly Furniture Insights newsletter. "Recent conversations have noted that business has not been all that bad in January 2013."
He noted that November shipments were 3% ahead of November 2011, while backlogs rose 8% in the same period.
For the first 11 months of 2012, orders were up for 67% of the survey participants, Smith said.
He said he believe the recent pickup in the housing market (2012 existing home sales were the highest in five years) has helped the furniture business, but he expressed doubts that trend can be sustained because consumer confidence remains weak.
"We have got to get consumer confidence back up for the furniture business to succeed," Smith wrote. "The housing impact will only last so long."