New orders from furniture retailers rose 11 percent in October 2011 compared with the same month in '10, 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. While the 11 percent increase was good, it compared with poor performance in October 2010, when orders were down 5 percent from October 2009. The 2011 order rate still was 6 percent higher than October 2009.
New orders were 5 percent lower than September 2011 orders.
Through October, new orders for 2011 are up 7 percent, up from a 6 percent increase through September. Through October 2010, new orders were up 5 percent over the first ten months of 2009.
October shipments rose 6 percent over October 2010, when they were 3 percent above October 2009, but fell 6 percent from September levels. Year-to-date, shipments were 3 percent ahead of 2010, when they were 8 percent ahead of the first ten months of 2009.
Backlogs were up 16 percent over October 2010 as orders exceeded shipments again (up from an increase of 13 percent reported last month).
Despite increased shipments compared with last October, receivable levels fell 1 percent from October 2010. Receivables were even with September levels though shipments were down 6 percent from September.
"Overall though receivables have seemed to be in pretty good shape, though from month to month, there can be timing issues," Smith Leonard Managing Director Ken Smith said in the survey report. "Inventories were up 1 percent from September, making them 3 percent higher than last year at this time. With orders up pretty nicely, the increase in inventories seems reasonable."
Factory and warehouse employment was even with September levels and up 1 percent from October 2010. September employment fell 1 percent from last September. Factory and warehouse payrolls, on the other hand, rose 10 percent over October 2010.
"It appears that employees were getting more hours this year than last," Smith said. "Last year at this time, we had begun to see business slowing down again, so we suspect hours were cut in many cases. We have also heard about some minor increases in wages per hour after several years of either flat or cut pay rates."
In summary, Smith said October results were positive overall.
"The 11 percent increase in orders versus October 2010 was a bit affected by the decline in orders reported last year of 5 percent versus 2009," he said. "Still, the October levels were almost 6 percent higher than 2009."
