The Second-half Challenges of Furniture – MIGE office furniture

The Second-half Challenges of Furniture – MIGE office furniture

|August 12, 2018 | News

Toisky said some clients have smaller profit margins, so they sometimes China office furniture manufacturer feel the need to cut expenses as opposed to hiring a factoring firm to handle their accounts receivable. “We did have a particular client that decided to handle their receivables on their own, and it’s been about four months since they did that. They just called us last week because they realize how much the factoring service not only improves their cash flow, but also the actual collections of the receivables have been difficult for them,” he said. “So they will likely be back with us shortly.” Baron and others said a big concern was the presidential election. “And not just the politics of it,  but what the outcome ultimately means for the economy, the furniture market and individual businesses,” Baron noted. “No one knows for sure what 2017 will bring but threats to the economy are always destabilizing especially so for growing businesses.”

In addition to the elections, Hanjin Shipping’s bankruptcy was a challenge. “Our container-direct accounts could foresee troubles with Hanjin and were able to prepare in advance,” said Eagle Capital’s Donnell. “Fortunately the outcome China conference desk manufacturer experienced was not nearly as bad as it could have been—only a two- to three-week delay with receiving some product. “Neither the presidential election nor the Hanjin catastrophe had the negative impact on our manufacturers and container-direct accounts as one would think based on the media attention both received.”

CIT’s Hudgens said labor is sues affect many clients. “We do business with a lot of North Carolina and Mississippi upholstery manufacturers, and labor continues to be an issue, not so much for experienced upholsterers, but there’s a shortage of cut-and-sewers,” he said, noting that many manufacturers had farmed out cut-and-sew to foreign sources. “With companies wanting to do more here — sewing their own kits—and be more responsive with quicker turnaround times, that’s an issue. “You aren’t going to get furniture in two days, but you don’t want to wait 12 weeks. All the component pieces need to move closer to the manufacturer, and that’s proven to be a problem because of the labor issue.” As part of that, the challenge Guangdong leather chair factory for manufacturers is they have to react to customers wanting quicker turnaround times. For importers, that perhaps means carrying more inventory “A contributing factor is with the consolidation at retail,” Hudgens added. “The Top 100 is doing more and more business, and those retailers have more clout Manufacturers have to react to that, and some are doing better than others.”

Milberg cited a tough retail environment, slow new housing growth and re-allocation of disposable income as second-half stumbling blocks. “This is probably the most under-rated and under-reported aspect of consumer spending,” he said of the last factor. “This new line item that everyone has includes ‘the digital world’ such as cell phones, apps, games and data. This expense never existed 15 years ago and is now a regular portion of disposable income. It is no surprise that low oil prices have had virtually no effect ‘to the good’ to consumer spending. Until this sorts out, that is where costs get normalized, it will continue to be a challenge.”

 

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