TBO.com - TBO is Tampa Bay Online

Furnishings sales continue plummet; tighter credit hurts

ADVERTISEMENT

BY RICHARD CRAVER

MEDIA GENERAL NEWS SERVICE

Published: November 7, 2008

Consumers' appetites for home furnishings dropped again in August, with orders tumbling 16 percent to $1.68 billion - the fourth double-digit decline in six months.
Smith Leonard PLLC, a financial-services company based in High Point, N.C., reported this week that 83 percent of the U.S. manufacturers and marketers that it surveys reported a decline in orders when compared with August 2007.

What makes the drop-off in August so unsettling, analysts said, is that they were down from subpar sales in August 2007. There also was not a hoped-for uptick in sales from the market in Las Vegas, which held its summer trade show in July.

"As with the last few months, several companies reported significant double-digit declines," said Ken Smith, the director of furniture services for Smith Leonard. "From street talk since August and through the High Point Market, we do not expect to see significant rebounds in orders in September and October."

Smith, however, said that the fall High Point trade show, which ended Oct. 26, appeared to have beaten exhibitors' low expectations for doing business.

"Many of the retailers we heard from did not need to buy a lot, but the smart ones know they needed to freshen their floors for when business does get better," Smith said.

The industry, particularly U.S. manufacturers and marketers, has been in a deep slump for orders since June 2006. It has been hampered by higher energy prices, the national housing crisis, and increasing credit-card debt and job insecurity among consumers.

Britt Beemer, the chairman of America's Research Group, said that consumer interest in buying home furnishings fell again in September.

"With so much uncertainty about the economy and with the discussion of the bailout effects, consumer confidence with making big-ticket purchases has been greatly impacted," Beemer said. "The only messages consumers want to hear are 'Save me money, save me more money, save me even more money,' " he said.

Analysts said that compounding the industry's problems is that with the national financial crisis compelling most banks to tighten their lending standards, consumers and retailers are struggling for the money needed to make purchases.

Share this:

Loading Comments...

Email Print

ADVERTISEMENT