April Shipments Plummet
July 2, 2009
Later High Point Market dates and continued softness in the market for furniture led to a 27 percent decline in April for furniture factory orders compared with April 2008, according to the Furniture Insights survey of residential furniture manufacturers and distributors from the High Point accounting and consulting firm Smith Leonard.
The decline in orders was the largest since October 2008 comparing to October 2007. April orders were off 19 percent from March. Year-to-date, new orders are now off 22 percent for the first four months compared to a 26 percent drop in the last quarter of 2008. Some 93 percent of the participants reported a decline in orders for the year-to-date with 71 percent of the participants off 20 percent or more.
April shipments were 21 percent lower than April 2008 and 15 percent lower than March. March shipments were 17 percent lower than March a year ago. Year-to-date, shipments are off 21 percent from the first four months of last year, the same as last month. Last year, through the first four months, shipments were down 8 percent so we have seen a significant decline over the two years.
Backlogs fell again as shipments for the month exceeded orders. Backlogs were 26 percent lower than April 2008 compared with 21 percent last month. Backlogs fell 5 percent from last month, and are at record low levels.
Receivables fell 20 percent from April 2008, the same results as last month. The 20 percent decline is reasonably in line
with the shipments decline for the month and year-to-date. Receivables were flat with March in spite of a decline in shipments from March to April, but that result is likely just timing of collections.
"So far, so good, though we are hearing of some write-offs of some of the smaller accounts," Smith Leonard Managing Partner Ken Smith said in the survey report. "The latest big one was the Hendricks group, but it was small in comparison to some of the big ones in the past."
Inventories were 12 percent lower than April 2008 levels up from 11 percent last month. April levels were 2 percent lower than March.
"Most companies we talk with are trying hard to reduce inventories for cash, including selling off some slow movers at discounts," Smith said.
The number of factory and warehouse employees fell 3 percent from March, resulting in a 21 percent drop from April a year ago. This result was up from a 20 percent decline comparing March to March.
Factory and warehouse payrolls were down 10 percent from March and 22 percent compared to April last year. In March, payrolls were down 24 percent both from the previous year and year-to-date. The April year-to-date drop of 23 percent is in line with the decline in shipments.
The decline in orders was the largest since October 2008 comparing to October 2007. April orders were off 19 percent from March. Year-to-date, new orders are now off 22 percent for the first four months compared to a 26 percent drop in the last quarter of 2008. Some 93 percent of the participants reported a decline in orders for the year-to-date with 71 percent of the participants off 20 percent or more.
April shipments were 21 percent lower than April 2008 and 15 percent lower than March. March shipments were 17 percent lower than March a year ago. Year-to-date, shipments are off 21 percent from the first four months of last year, the same as last month. Last year, through the first four months, shipments were down 8 percent so we have seen a significant decline over the two years.
Backlogs fell again as shipments for the month exceeded orders. Backlogs were 26 percent lower than April 2008 compared with 21 percent last month. Backlogs fell 5 percent from last month, and are at record low levels.
Receivables fell 20 percent from April 2008, the same results as last month. The 20 percent decline is reasonably in line
with the shipments decline for the month and year-to-date. Receivables were flat with March in spite of a decline in shipments from March to April, but that result is likely just timing of collections.
"So far, so good, though we are hearing of some write-offs of some of the smaller accounts," Smith Leonard Managing Partner Ken Smith said in the survey report. "The latest big one was the Hendricks group, but it was small in comparison to some of the big ones in the past."
Inventories were 12 percent lower than April 2008 levels up from 11 percent last month. April levels were 2 percent lower than March.
"Most companies we talk with are trying hard to reduce inventories for cash, including selling off some slow movers at discounts," Smith said.
The number of factory and warehouse employees fell 3 percent from March, resulting in a 21 percent drop from April a year ago. This result was up from a 20 percent decline comparing March to March.
Factory and warehouse payrolls were down 10 percent from March and 22 percent compared to April last year. In March, payrolls were down 24 percent both from the previous year and year-to-date. The April year-to-date drop of 23 percent is in line with the decline in shipments.
