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Furniture and home furnishings stores sales last month topped the broad retail sector and were among the best performing categories, with a 5.4% increase over the same month last year, according to the latest U.S. Department of Commerce guangzhou office furniture factory report.
Estimated furniture and home furnishings store sales totaled $9.63 billion in August, up from a revised $9.12 billion in August 2016, the government reported. Sales were up 0.4% from the month before, based on a July sales estimate that was revised down to $9.59 billion.
From June through August, home furnishings store sales were up 4.6% from the same three months last year and increased 0.8% from the March-through-May period of this year.
David Montiel, director of originations at White Oak Commercial Finance in Charlotte, N.C., which provides factoring services to the furniture industry said the month-over-month and year-over-year increases in August mesh with what the company’s clients are experiencing “due to the strong housing market and overall economy.”
“Most of our clients realized high single-digit or even double-digit growth for the month of August, which is generally known to be slower, as consumers favor spending money on travel/vacations as opposed to making furniture purchases,” Montiel said. “We expect this growth to continue into the busier months of September and October with the caveat that Florida and Houston markets may impact performance.”
Total U.S. retail and food services sales increased 3.2% in August from the same month last year to $474.8 billion but were down 0.2% from July. Retail sales alone increased 3.3% from a year ago and were down 0.3% from July. The largest gain continued to come from non-store retailers – primarily by e-commerce and catalog businesses, with sales up 8.4% from August 2016 but down 1.1% from July.
Other sectors showing particularly strong growth included building material and garden and supplies stores (up 7.5% from August a year ago) and gasoline stations (up 6.4%), the report said.
Department stores, a subcategory of general merchandise stores, electronics and appliance stores and sporting goods, hobby, books and music stores were the only sectors losing ground year-over year. Electronics and appliance stores posted the steepest decrease, down 3.5% from August last year. China reception desk manufacturer Department stores were off 0.8% from a year ago and down 0.1% from last year.
Significantly more Baby Boomers than Millennials, 65% vs. 51% guangzhou office furniture company, describe their outdoor decorating style as traditional, according to a recent study from Furniture Today’s sister publication Casual Living. Despite the difference, traditional is the top outdoor style across all generations.
Just 1% of Baby Boomers describe their style as contemporary or modern, significantly less than Millennials at 13% and Generation X at 10%. For Generation X, modern style is tied with tropical looks as the second-most chosen style at 10%. Tropical is the second-most popular for Millennials at 16%, and contemporary/modern is third at l3%.
Sixteen percent of Baby Boomers identified with a style that was not listed, such as rustic or Americana, the second-highest choice among the age group. That number is 10% more than Millennial respondents that reported the same.
While traditional is still the top decorating style for consumers with outdoor spaces in all areas of the U.S., 64% of respondents from the Northeast describe it as their outdoor decorating style compared with 58% of the South and 56% of both the West and Midwest. At 4%, significantly less of the Northeast indicates that tropical is their outdoor style of choice compared to 14% of both the South and Midwest.
When shopping for outdoor furniture, three-fourths of respondents say that they consider style and design, which is tied with price as the No.1 consumer concern in outdoor furniture shopping.
Generationally, that is not always the case. Although Millennials are the most mindful of outdoor furniture design of all generations, more of them (81%) look for the best price over their preferred style at 78%. Generation X considers design and style just slightly more than price, 73% vs. 72%. Style and price are equally important to Baby Boomers, at 74%.
Price is also more important than design for consumers in the South, at 78% vs. 75%, and the Midwest, at 80% vs. 72%. Of all U.S. regions, the Northeast China negotiation desk manufacturer considers style the most important: Seventy-seven percent of North-eastern consumers say that they consider design and style when looking to purchase new outdoor furniture.
As a new year begins, guangzhou office furniture manufacturer I bring you some comforting news: Physical retail is not dead. Nor is it dying. Nor, very significantly, is it being abandoned by Millennials, those much-discussed consumers who are turning the world on its head, or so it is said.
This good news comes to us from the respected National Retail Federation, and design guru Connie Post shared some of the highlights at the recent Furniture Today Leadership Conference.
The conference, attended by a bevy of top mattress and sleep accessory producers and retailers, delivered several endorsements of the vitality of brick-and-mortar retailing. One came from Post herself, who has spent a career bringing excitement and fun to home furnishings stores with her fresh and innovative designs.
“New always wins,” Post said at the conference, repeating one of her design mantras. That point was hammered home as Post showed us room after room of new designs that injected energy into furniture and mattress departments.
The NRF research shared by Post notes that younger consumers embrace physical retail when it offers a new experience or is more convenient.
The research looked at Millennial and Gen Z consumers (Gen Z is the generation that follows Millennials) and found that about half of them are shopping physical stores more than they were a year ago. About one-third of those consumers said they are visiting physical stores at about the same pace as a year ago.
Only 17% of the Millennial/Gen Z respondents say they are visiting physical stores less often than they did a year ago, the NRF research says.
These findings refute the notion that most Millennials are abandoning physical stores and doing most of their buying online, and that’s good news for the mattress industry, where brick-and-mortar sales make up the vast majority of the retail business.
Why are Millennial/Gen Z consumers stepping up their visits to physical stores? The top reason is that a new retail store or shopping center has opened near them (cited by 52% of the younger consumers). But it’s interesting that 45% of those consumers say they are visiting stores more often than in the past to pick up items they bought online, a click-and-brick model. One opportunity with those consumers is to see if those consumers might want to pick up something else when they arrive at the store.
So, as we stand at the starting line for a new year, we can be confident that in an industiy that is undergoing rapid change, we aren’t losing all of those younger, tech-savvy consumers to the Internet.
Make no mistake about it, the online world is growing in importance. But it’s nice to know that many Millennials are actually spending more time in stores now than they were a year ago, for a number of reasons.
A good new year’s resolution would be to spruce up those mattress stores and departments, making China filling cabinet manufacturer them more inviting to consumers of all ages.
In the early stages of the decision-making process, guangzhou office furniture provider consumers look for inspiration. It is the brand’s role to provide such inspiration via content, so brands need to be where consumers are.
Traditional social networks such as Facebook and Twitter are cited by 39% of consumers for inspiring purchases, according to data from PricewaterhouseCoopers’ Total Retail 2017 report. Individual retailer websites are cited by 37%, followed by price-comparison websites with 35% and multi-brand websites with 32%. Visual social networks, such as Instagram, Snapchat, Pinterest and YouTube, came in fifth per the PwC report.
In research by ViSenze titled “Visual Commerce Report Retail,” Facebook was ranked first among social media users for being the primary platform to inspire a buying decision at 32%. Pinterest was second at 16%, followed by Instagramnatn12% and Snap chat at 2%. Thirty-eight percent of social media users cited no platform for inspiring purchases. The research did not account for other platforms, including Twitter.
Social media greatly impacts purchasing decisions as seen above, and one-third of all online purchases originate on social platforms each month. “Social media, as well as the increasing amount of visual content available online, influences consumer purchase behavior more every day,” said Oliver Tan, CEO and co-founder of ViSenze.
The ViSenze research found that three-quarters of consumers are inspired to purchase by image and video content online, and almost half of consumers watch video content on retailers’ websites while shopping. This highlights the increasing importance of video format and how it is becoming a significant opportunity to connect with consumers.
Google has been tracking a steady rise in visual searchers via Google images and YouTube for product-related information. Product images are the most used shopping feature, according to consumers who search and shop on their smartphones a minimum of one time per week.
Google’s research agrees with China conference desk manufacturer ViSenze that video is a top format to inspire consumers. According to Google research, more than 50% of Internet users look for videos related to a product or service before visiting a store.
Tempur Sealy, guangzhou office furniture supplier, which held off on price increases last year, announced “commodity driven” price increases that will go into effect on March 6.
The increases will impact all Sealy mattresses, all Stearns & Foster mattresses, Tempur Pedic Cloud Supreme Breeze mattresses, and Tempur-Pedic flat foundations, said Steve Rusing, senior vice president of U.S. sales for Tempur Sealy.
“Major component raw material costs for foam, steel, upholstery and wood have increased significantly in the last 24 months, and are expected to rise further in 2018,” Rusing said in a recent letter to the company’s dealers. “While Tempur Sealy has avoided a price increase up to this point, through its own productivity initiatives and cost controls, these actions alone are not enough to offset rising costs. Thus Tempur Sealy is instituting a price increase to offset commodity increases so that we can continue to invest in our products and marketing efforts.”
Sealy and Stearns & Foster queen-size sets retailing for $1,899 and below will see a wholesale price increase of $25 and a retail increase of $50. Sets retailing for $1,900 and above will see a wholesale price increase of $65 and a retail increase of $150, the company said.
Tempur-Pedic Cloud Supreme Breeze mattresses will see a wholesale price increase of $90 and a retail increase of $200. Tempur-Pedic twin flat foundations will see a wholesale price increase of $15 and a retail increase of $25, while Tempur-Pedic full and queen flat foundations will see a wholesale price increase of $25 and a retail increase of $50, China office sofa manufacturer Rusing said.
Freezing temperatures, heavy snowfall, polar vortexes and bomb cyclones are typically bad news for retailers. But guangzhou office furniture factory furniture stores in the North and Northeast appear to have weathered the recent round of extreme weather quite well … unless they happened to be based here in Erie, Pa., like John V. Schultz Furniture.
“We get a lot of snow in Erie, so we’re used to it, but nothing like what we experienced,” said President John Schultz. A bad band set up over Lake Erie pushed in from the west “and just clobbered us,” he said.
“It started on Christmas Eve and was a complete whiteout all Christmas Day and pretty much the day after.” By that time, Erie had recorded nearly 6 feet of snowfall, shattering the record for a two-day period (among other city and state records).
“And that was on top of what we had already gotten for the month of December,” Schultz said. “It was cold so we didn’t really have any melt.”
The weather continued to be miserable through New Year’s Day (the snowfall total rose to nearly 7 feet since Christmas), so business was “non-existent” during one of the retailer’s typically busiest times of year. Schultz estimated sales were down for the period between Christmas and New Year’s Day by more than 70%.
And the store struggled to make deliveries on its written business because the streets in Erie were impassable, except in a few cases south of the city where Schultz managed to get trucks to the interstate.
It’s not exactly how Schultz hoped to end the old year or start the new one, but he’s hoping to make up a little ground.
“We’re routing in some more promotions now, starting next week,” he said. “We’re going to hit the Martin Luther King weekend hard, offering free delivery and things like that to try to pick up some of that business.”
He’s also counting on the typical cabin fever to set in and with that lift sales, although he added that he knows you never really get it all back.
More manageable
Elsewhere in the North following in the early days of 2018, the snow and below-freezing temperatures were uncomfortable but much more manageable, several retailers reported.
Detroit picked up some snow after New Year’s Day, but it was the cold that really halted traffic, said Tom Lias, president and CEO of Farmington, Mich.-based Gorman’s Home Furnishings & Interior Design.
It’s the kind of cold – 8 degrees below freezing – that does slow traffic, Lias said. Unless clients were in the middle of projects with the mid-priced to upscale retailer, they were quick to cancel appointments, and even some in mid-project called to postpone.
“We had a good New Year’s Day, but it tightened up right after that, and the first week of the year started a little slower than a year ago,” he said.
That said, Lias noted he was already seeing an uptick in traffic Sunday and Monday as the severe cold spell broke.
Another positive: The worst of it fell midweek, normally a slower traffic time. “If you’re going to have a cold snap or snow storm, hope for Tuesday or Wednesday,” he said.
In Boston, Larry Rubin, CEO of the seven-store Bernie & Phyl’s Furniture, agreed with that sentiment. His market was hit with much more snow Thursday, Jan. 4, and severe cold temperatures followed. The retailer closed all stores Thursday and saw a roughly 5% sales decline for the week, mostly attributable to that closing, but “business really was not that bad,” he said.
“I expected it to be worse than it was,” Rubin said. “Probably 50% of your business is done on the weekend, so if you have a storm that falls on the weekend, I think it hurts you a lot worse,” even more so when it falls on a holiday week, he said. “We had a pretty good weekend, and it was really freezing temperatures, so people still got out and shopped.”
About an hour west of Boston in Worcester, Mass., the weather was severely cutting into traffic at Rotmans, but the average ticket during the worst of it jumped about 50%.
“The consumers that came in were basically higher income and looking for products that were more expensive,” said Steve Rotman, president and CEO. “Also, they tended to shop more. Rather than looking for one or two items, they were looking for a multitude of items, and the closing rate was much higher.”
And because there were fewer consumers in the store, salespeople were giving them more time, which signaled to Rotman that maybe the store is understaffed normally (since the added time was leading to larger tickets).
The cold spell ended Sunday, Jan. 8, and things are warming up nicely, China office chair manufacturer Rotman said. He closed just one day during that first week of January and like Bernie & Phyl’s, that did affect sales, but “overall our figures were up because we were very aggressive in advertising.”
American Furniture Warehouse guangzhou office furniture manufacturer confirmed it is negotiating for land in the greater Houston market but stopped short of saying it’s definitely coming to the market.
The houston Business Journal reported American Furniture Warehouse intends to purchase 23 acres to build a 350,000-square-foot store and distribution center in the city of Webster, Texas. The Englewood Top 100 company confirmed to Furniture Today that it is negotiating for land in that city but said nothing has been finalized yet.
According to the Business Journal and a newsletter on the website of the Bay Area Houston Economic Partnership, AFW intends to purchase and build at 21404 Gulf Freeway and that, when completed, the project would create 350 full-time jobs. The city of Webster placed a value of nearly $50 million on the project, including land, construction and development. The report said the information came to the partnership via the city of Webster.
Webster’s director of economic development declined to comment for this story.
Some in the furniture industry have been speculating about AFW entering the hotly contested Houston market for months, and during the October High Point Market, when asked about the rumor, AFW President and CEO Jake Jabs declined to confirm or deny it.
In a statement sent to Furniture Today on Wednesday, the retailer said it has been exploring expansion opportunities for the past 18 months.
“We looked at a number of adjacent markets to our current Phoenix and Colorado stores as well as larger markets based on our success in Phoenix. One of the markets we have been considering for expansion is Houston,” Jabs said.
“It is a city with great potential for AFW based on its size and dynamic economy. While AFW does not have any properties under contract at this time, we are in negotiations for land in the Webster area, which was recently announced in the Houston Business Journal. When our land purchase is finalized, we plan to make an official announcement.”
If the Webster location comes to fruition, it will be practically next door to a 52,000-square-foot showroom Houston retailer Exclusive Furniture is building in the market and hoping to open in late summer.
Asked about AFW’s and Jab’s possible entrance, Exclusive President and CEO Sam Zavary told Furniture Today, “I’m hoping he’s going to bring a lot of traffic to the area.”
AFW is No. 19 on Furniture Today’s Top 100 with estimated furniture, bedding and accessory sales of $640 million at China office desk manufacturer 14 Colorado and Arizona stores in 2016.
American Furniture Manufacturing has resumed motion upholstery production at its factory here, which was damaged by fire Jan. 5. This week, the company migeof office furniture will add three stationary upholstery lines to the same production area.
A fire destroyed some 35% of American Furniture Manufacturing Plant 2 Motion Recliner faci1ity, but despite the heavy damage to the warehouse and shipping areas of the faci1ity, the company was able to resume normal production less than four days later.
Randy Spak, president of American, told Furniture Today the company has also secured a 200,000-square-foot warehouse in nearby Houka, Miss., that it will use to bring an additional five stationary upholstery lines into production next week. At that point, the company will have resumed full production of motion upholstery and will have eight of its original 17 pre-fire stationary upholstery lines in operation.
Two weeks after that, the company expects to have smoke and soot damage to its original stationary upholstery area cleaned up and will add eight more lines, bringing the company back to its full pre-fire capacity roughly five weeks after the fire destroyed its finished goods warehouse.
A portion of the Houka facility will also be used for warehouse and finished goods staging, replacing the portion of the company’s facility that was destroyed by the fire. The company has also secured two additional leased warehouses in the Pontotoc, Miss., area to house its finished goods and handle shipping to customers.
This is the second fire at the facility in the past 10 years, the last one occurring in 2008. After the 2008 fire, the company installed a series of fire walls, which Spak guangzhou school furniture manufacturer said he believes were instrumental in limiting the damage in this incident.
While there has been high-profile discussion of returning manufacturing jobs to the U.S., when it comes to the migeof furniture industry, this effort has been and will increasingly be hampered by a shortage of suitably skilled workers.
The once ubiquitous “shop” class that gave junior high school and high school students experience in vocational skills has disappeared from American schools. Meanwhile, the effort to encourage virtually all students to attend college has stigmatized vocational learning and discourage young people from pursuing technical careers.
The challenge has been recognized within the furniture industry, and a number of manufacturers have over the past few years started exploring efforts to initiate training programs at the college level.
Among these efforts was the creation of the Catawba Valley Furniture Academy, a partnership program between Catawba Valley Community College and a number of North Carolina manufacturers. The academy, taught by artisans employed by local manufacturers, is designed to prepare a future workforce for the furniture industry.
The broader challenge is encouraging students to pursue technical careers, particularly in an environment where local schools lack the will, resources and, in many cases, the teachers to provide this form of education. Recognizing this, Ashley Furniture Inds. has undertaken to understand the type of programs that could change this momentum, including sending company executives to study technical training programs in Germany where such programs have demonstrated a high success rate.
As a result, the company has initiated a number of programs in the communities in which it operates, including arranging tours for middle school students at its plants in Wisconsin and North Carolina. The goal is change the mindset that many young people have about traditional manufacturing facilities and allow them to see first-hand the types of technology with which they could be involved should they choose to pursue a vocational career path.
The company has also donated to local school efforts in its communities that support STEM (Science, Technology Engineering and Mathematics) educational efforts, including underwriting mobile modular technology labs that travel to schools lacking facilities, equipment and trained professionals to provide appropriate educational programs. The traveling lab offers hands-on training exercises to help students develop the skills and experience needed for increasingly automated factory production.
The point of this is not to single out Ashley, although its substantial commitment is laudable, but to spotlight an industry-wide need. one that will likely rely on the proactive support of private individuals guangzhou training furnitures manufacturer, companies and even entire industries. There is no better time to address the future of American education. If your company is undertaking efforts of this kind, let me hear from you.
Reduced unemployment and an increase in consumer disposable income are aiding growth in the migeof furniture industry, which is expected to grow 3% to $111.4 billion from $108.2 billion in 2017.
According to Furniture Today’s exclusive economic forecast, which is based on projections from more than two dozen economists and economic predictions, inflation is projected to be 2.1% for 2018. This estimate is a 0.3 percentage point increase over the Bureau of Labor Statistics’ 2017 expected inflation of 1.8%.
Economists and federal officials are confounded by the low inflation rates because the unemployment rate is low;typically, the two rates have an inverse relationship. The unemployment rate for November 2017 is at 4.1%, a 16-year low, and it is expected to hover around that point for 2018. Since January 2017, the unemployment rate has fallen by 0.7 percentage points, and the number of people who are unemployed has declined by more than 1 million.
With the labor market nearing full employment and the persistent low inflation rate, the Federal Reserve raised its benchmark federal funds rate on Dec. 13, 2017, by 0.25% and is on track to raise the rate three times this year. According to Janet Yellen, chair of the Federal Reserve Board, the Fed does not want to hinder growth but feels strongly about keeping steady since the labor market is nearing full employment.
“We want to do this gradually because if we allow the economy to overheat, we could be faced with a situation where we might have to … raise rates and throw the economy into recession,” Yellen told Congress. “We don’t want to cause a boom-bust condition in the economy.”
The Fed’s impending rate increases suggest that the bank is reluctant to halt interest rates in an experiment to see how low unemployment can go without boosting inflation.
“Consumers entered the holiday season in very high spirits and foresee the economy expanding at a healthy pace into the early months of 2018.”Lynn Franco said from the Conference Board. “We are not seeing undue inflationary pressure in the labor market, so our policy remains accommodative,” Yellen said. “But we do think it’s important to gradually move our policy rate toward what I’ll call a neutral level, which would be consistent with sustainably strong labor market conditions.”
An upward track
Since 2013, the trend for real disposable income has been steady growth, and that upward inclination is expected to continue when the final numbers are available for 2017. Per the U.S. Energy Information administration, real disposable income is projected to grow by 2.1% in 2017. Furniture Today’s economic forecast predicts real disposable income will grow to 3% in 2018.
Median household income, however, is not growing as fast as consumer expenditures. According to The Pew Charitable Trusts, from 1996 to 2014, median household income(adjusted for inflation) has increased only 0.52%, while the median expenditure increased 25.2% during that same period. This means that U.S. consumers are spending more of their income on food, housing, apparel, transportation, health-care, entertainment and other expenses now than they were 20 years ago.
Furniture Today guangzhou reception desk manufacturer is forecasting 2.4% growth in gross domestic product for 2018, nearly a full percentage point less than the 2017 third-quarter rate of 3.3%.