How Much is Covid Affecting Furniture Shipments?

by | Sep 16, 2021 | Ask the Expert | 0 comments

Question:

Furniture companies are saying that the Covid crisis is creating major shipping and delivery delays.

How much is Covid affecting furniture shipments? When the Covid vaccines are available worldwide, will shipping times improve?

Dec. 20, 2020

 Answer:

There are tremendous delays throughout the entire furniture industry.

  • The delays are both international and national.
  • They are expected to continue for at least another year and probably well beyond that.

Covid is a new factor with a significant impact. It is a convenient (and easily understandable) excuse, but it is not the major cause of the current delays.

Internationally, the trade embargo against China has drastically affected imported shipments.

  • China used to supply more than 80% of U.S. furniture imports. This includes both finished goods and raw materials.
  • Due to extremely high tariffs on furniture products imported from China, that nation’s share of imported furniture, fabrics and parts has shrunk below 20%.
  • Vietnam and other Asian nations have absorbed most of the shipments lost by China.

Although these alternative sources quickly expanded manufacturing facilities, shipping capacity has not been able to keep up.

  • China had huge modern port facilities which could receive, load and ship large container loads with great efficiency.
  • Port facilities at the new Asian sources are far less efficient. Threatened tariffs for additional Asian nations have slowed development of major new port construction.

Slowdowns in international container shipments have had a major effect on wood furniture. 80% of wood furniture sold in the U.S. is imported from Asia.

Only 40% of upholstered furniture is imported, but many of the critical raw materials, including fabric, plywood, mechanisms, metal parts and electronic components are sourced primarily from Asia.

Nationally, there is a major shortage of truck drivers, especially those for last mile home deliveries.

  • A November 23, 2020 article in Furniture Today stated that shipping companies nationwide are receiving orders at 120% of capacity. For 2021 shipping is expected to be 130% of capacity.
  • Part of the driver shortage is due to Covid shutdowns and restrictions, but it is not the biggest factor.
  • Serious shipping shortages began with new regulations put in place about a year ago.
    • The new regulations limit the number of hours and miles truck drivers are allowed to travel each day (and week.)

Because of the shipping delays, furniture manufacturers have been hoarding essential supplies. This includes fabrics, foam, lumber etc.

    • Manufacturers with sufficient financial resources are ordering 2 – 4 times the normal quantities of raw materials.
  • This creates the same type of situation as when toilet paper and cleaning supplies disappeared from grocery stores.

Retailers are also placing larger orders. Although brick and mortar stores have lost business, overall furniture sales have increased.

  • These additional sales have shifted to online retailers.
    • Wayfair and Amazon have both increased furniture sales by more than 40% compared with 2019.
  • After initial shortages during the early months of Covid, large retailers are placing larger orders and building depleted inventories.
  • In-stock merchandise is quickly selling out, including product lines that used to be slow sellers.

Everyone (retailers and manufacturers) is competing to bring in additional inventory.

Know someone who might be interested in this post? Please like and share this post with them. If you have questions or comments please leave them below.

Jeff Frank

Jeff Frank

Furniture Consultant

Jeff Frank is a 45 year  furniture industry veteran. He created this blog to provide detailed facts, inside information & advice for furniture shoppers. 

 

 

 

 Shopping for furniture can be complex and frustrating. Salespeople have limited knowledge & experience about the products they sell. If you’re looking for real answers before spending hundreds or thousands of dollars, check out our furniture buyer consulting.

0 Comments

Submit a Comment

Your email address will not be published.