Furniture retailers' August new orders for furniture rose 8 percent compared with August 2012, according to the latest Furniture Insights survey.
High Point accounting and consulting firm Smith Leonard conducts the monthly survey of residential furniture manufacturers and distributors.
Year-to-date, new orders were up 5 percent over last year. In 2011, year-to-date orders were 6 percent higher than the first eight months of 2010. Around 65 percent of the survey participants have reported increased orders year-to-date, compared with 56 percent reporting increased orders at the same point last year.
August shipments were up 6 percent over August 2011 and 25 percent over July 2012. August 2011 shipments had risen 3 percent compared with July that year.
"Of course, the comparison to July is affected by the normal vacation shut down by most," noted Smith Leonard Managing Partner Ken Smith.
Backlogs dropped 2 percent from July as shipments, in dollars, exceeded new orders. Backlogs were 6 percent higher than August 2011, up from a 2 percent increase reported in July.
Receivables receivables were even with August 2011 in spite of the increase in shipments, both in the month and year-to-date shipments.
"Overall, we continue to be pleased with receivables' levels," Smith noted.
Inventories rose 1 percent from July and were up 9 percent over August 2011.
"Inventories will need to be watched," Smith said. "We know some distributors are carrying more to avoid out of stocks, but with orders up only 5 percent, it's a bit bothersome seeing inventories up 9 percent."
Factory and warehouse employment rose 3 percent over August 2011, the same increase as reported in July. Employee levels remained even with July 2012 results.
Factory and warehouse payrolls rose 4 percent in August and are now up 7 percent year-to-date, the same as reported last month. Payrolls appear to be in line with current volume levels.
Smith said in summary that the 8 percent increase in orders for August was "a bit surprising."
"But reviewing the results, just over 60 percent of the participants reported increased orders and a good number reported double digit increases," he said. "In addition, a good number of those participants with orders declining were only off a few percentage points … so overall, we are slowly digging out of the hole we have been in."
He said that overall, conversations at October Market indicated it turned out pretty well.
