According to the July Michael A. Dunlap & Associates’ (MADA) Furniture Industry Index, which surveyed the success of more than 250 furniture manufacturers, business is good. The index stands at 55.6*, which is significantly higher compared to April at 54.6 and January at 54.3.
The survey focuses upon 10 key business activities, with respondents rating each area on a scale of one to 10. The business activities are Gross Shipments, Order Backlog/Incoming Orders, Employment Levels, Manufacturing Hours (Overtime vs. Reduced Hours), Capital Investment, Tooling Expenditures, New Product Development Activity, Raw Material Costs, Employee Costs and the respondents’ Personal Outlook on the industry.
“The industry continues to move on a very steady and improving trend line,” said Mike Dunlap, owner of MADA, which puts out the survey. “This is good news. The Overall Index continues to remain well above 50 and is definitely above 40, which is the survey average. We are confident that the industry is still on course to achieve its best year in more than a decade.”
The July 2014 survey highlights include the following:
• Gross Shipments jumped to 61.9 from 53.4 in April
• The Employment Index of 54.2 is well above the survey average of 51.9
• New Product Development improved to 64.1, above the survey average of 63.3
• The Personal Outlook Index rose from 60.8 in April to 62.2 in July
“The increases in Gross Sales and Order Backlog index values are very significant,” said Dunlap. “Both have been improving since the first half of 2013, but these larger increases are not a common occurrence. They are on very solid path to improvement. I am also delighted to see the strength of the index in Personal Outlook Index. The most frequently cited perceived threats to the industry’s success are healthcare costs and the costs of materials (steel and wood) since this survey process was started in August 2004.”
Michael A. Dunlap & Associates is a consulting firm that focuses upon issues involving the working, learning, healing and hospitality environments and furniture industries. Each month the survey is sent to more than 250 companies, which include commercial furniture manufacturers who produce products for the office, education, healthcare and hospitality markets. The firm then calculates the results and keeps tabs on the furniture industry market trends.
*An index of 100 means that things “couldn’t be better,” an index of one is “absolutely the worst” it can be, and an index of 50 means it is neutral; no change “up” or “down.”