Despite Steelcase and Herman Miller reporting an increase in quarterly revenues, the overall office furniture industry didn’t get off to a great start in 2013.
Declines in gross sales and order backlog contributed to a dip in the index that measures the activity of the office furniture industry beyond its West Michigan capital.
“The industry can be described in one simple word – FLAT!”, said Mike Dunlap, in a statement releasing his firm’s index for the first quarter of 2013. ”Given current economic conditions, I think this is not bad news.”
Overall, the industry is on solid ground despite some lower indicators, said the Holland-based furniture analyst.
Dunlap said the drop in gross sales and order backlog index were unexpected because both had improved in the the fall. He attributed the slump to the lingering impact of “Super Storm Sandy” and significant downturn in government sales. Those same factors also contributed to a rollback in the index measuring employment levels and hours worked.
While there was a modest decline in capital expenditures, there were improvements in tooling expenditures, he added.
Dunlap says he remains optimistic that office furniture manufacturers will see a small improvement in the second half of the year.
“I hold the opinion that the industry will see some slow growth period during the next two quarters of 2013, then see a modest acceleration during mid to late 2013 and into 2014,” Dunlap said.
That forecast comes as West Michigan office furniture-makers gear up to showcase their latest products at the Chicago trade fair NeoCon in June.
The April 2013 Overall Survey Index is 52.84, which is down slightly from 54.30 in January. Below are survey highlights:
• The Gross Shipments Index dropped to 49.45 from 57.57.
• The Order Backlog Index fell to 51.27 from 56.45.
• The Employment Index edged up to 51.82 from 51.69.
• The Hours Worked Index declined to 52.88 from 55.53.
• The Capital Expenditures Index slid to 54.72 from 55.33.
• The Tooling Expenditures Index rose to 57.36 from 55.60.
• The New Product Development Index climbed to 65.74 from 63.41.
• The Raw Material Costs Index remained nearly unchanged at 46.15.
• The Employee Costs Index rolled back to 43.85 from 46.88.
• The Personal Outlook Index slipped to 59.20 from 54.73.