Bad news followed good, according to Ken Smith of High Point, N.C., accounting and consulting firm Smith Leonard.
While reporting a 4 percent increase in residential home furnishings orders in December 2019 over December 2018, Smith noted the obvious, and ominous, new development: “The coronavirus situation is not helping us start 2020 in a very positive way. All the concerns over travel, sourcing and general bad news will not be good if this epidemic isn’t slowed soon. Consumer confidence has remained high, but that study was done before the news finally scared the stock market folks into realizing this is more than a virus but a serious problem for business in getting materials, parts and labor. That includes even getting products shipped.”
The December numbers, based on Smith Leonard’s monthly survey of residential furniture manufacturers and distributors, had reversed a downward slide.
Orders declined 2 percent for 2019
“Orders were down 8 percent in October and 5 percent in November, so it was nice to see the negative trend reversed,” Smith Leonard reported. “Unfortunately, only 58 percent of the participants reported increases. So, for the year, orders were down 2 percent, and that result was much more consistent among the participants, as some 71 percent of the participants reported lower orders for all of 2019.”
In the “Thoughts” portion of Smith’s report, he addressed coronavirus concerns: “We hope that this whole issue can be controlled soon. The disruption in business will be very serious the longer it lingers. With the negative news from this year’s election coming up, that will be enough to create problems in the industry, without the virus issues.
“Despite all of this, most of the economic news indicates that the economy should remain in a decent growth mode for most of 2020. But again, the virus scare has not yet been reflected in much of the economic data. Let’s hope we can get through all of this soon, so we can have a chance to enjoy the ‘good’ economy, maybe a bit better than the industry did in 2019.”