Orders and output are on the rise and the costs of materials are falling, prompting a positive perspective, according to national trade body, British Furniture Manufacturers (BFM).
In its most recent Trade & Price Trends Survey, the BFM found that the number of respondents that were more optimistic about the general trading environment compared to six months ago had risen by +23%. That same percentage also reported that trade was better than the same time last year.
The survey, which is held twice a year in spring and autumn, maps out the key factors in the industry including employment, output, costs and exports, as well as giving an indication of the opportunities and challenges BFM members anticipate for the coming six months.
A key theme to emerge from the survey is an easing of material price increases. In October 2022, 86% of respondents reported raw material rises, while in April 2023, rises were reported by only 15%.
Rising overheads and labour costs had prompted 69% of respondents to increase product prices in the last six months, with the most common increase being +5%.
No redundancies were reported in the past six months, with none anticipated for the coming six months.
And while pressures from skill shortages have improved, with 46% having no issues to report compared to 23% six months ago, 54% still reported moderate-to-severe problems in recruiting skilled labour.
BFM chairman Nick Garratt says: “Six months ago, the furniture industry was braced for a difficult winter. Optimism surrounding the general business situation had plummeted to -64%, with one in five respondents to the October survey reporting that they were either making a loss or breaking even.
“With spring has come a new optimism thanks to stabilising material prices, a rise in order intake and a +31% leap in output. More survey respondents have reported falling profit margins (15%), but this is the lowest figure for two years, and 38% of respondents are expecting cash flow to improve over the next six months.”
A full version of the survey is available to BFM members via the association’s website.