And now, for some truly frightening statistics...
Jerry Epperson -- Furniture Today, June 23, 2008
Sometimes it seems like all I do is discuss statistics. In reality, I only do it 50.326% of the time and 70.261% of my predictions are right, but only 41.266% of readers agree with me. Of course, most of them are in the second quartile of the fourth dimension by 8.911%.
The March quarter of this year had some truly frightening statistics, in my opinion, because they illustrate not only how fast this industry is changing but how weak things really are.
The numbers I am quoting are for the March 2008 quarter vs. the March 2007 quarter. If you remember, residential furniture sales began to weaken late in 2006. The first quarter of 2007 was not good but business got even worse as 2007 passed. Also, for most of 2007, we had too much inventory both in the supply chain and in retail warehouses, something not as obvious today.
Something very evident is that the lenders are pulling in their credit exposure to anything that looks like, smells like or that goes into housing. Furniture retailers are finding that their available credit lines are being reduced, and they are being forced to downsize inventories. As this process goes forward, retailers' numbers are actually somewhat better than their suppliers, believe it or not.
According to official government statistics, the total retail consumption of furniture and bedding in the March quarter was down 2.1%. We believe a more accurate number nationwide would be a decline of 9%.
From the suppliers' side in the first quarter, domestic wood furniture shipments fell 13.2% and imports were off 8.2%. Imports from China, Canada, Malaysia and Indonesia fell 12.2%, 9.8%, 13.1% and 12.2%, respectively. Of the top 10 sources for imported wood furniture, only one reported a gain and that was Vietnam, up 23.1%. Vietnam shipped us about one-fourth the amount of wood furniture that China did in the first quarter.
Remember the growing wave of upholstered furniture imports? The tide evidently went out because while domestic upholstery shipments slid 7%, upholstery imports fell 11%. Among our top four import sources for upholstery, the declines were 7%, 31.8%, 11.7% and 30.8% from China, Mexico, Italy and Canada, respectively.
Even the most stable of the home furnishings categories, mattresses, experienced a decline in domestic shipments of 6%, while imported mattresses fell 9%.
Sadly, the June quarter may show similar numbers when reported in a few weeks. The best that can be said is we are producing some statistics that will hopefully be easy to beat next year!
