HOLLAND, Mich. – The office and contract furniture market continues to see strong demand for their products.
Michael A. Dunlap & Associates announced the results of its July 2017 Quarterly MADA / OFI Trends Survey, and an overall survey index of 57.49, above the average.
“The industry continues to grow but at a nice, steady pace,” Mike Dunlap said. “The overall index is strong and remains above the 54.93 survey average. We remain confident that 2017 will exceed 2016. I feel good about where the industry is going.”
The July 2017 survey overall index is 57.49 compared to an almost identical January 2017 overall index of 57.87. The 51-survey average overall index is 54.93. The highest recorded index was 59.72 in July 2005 and the lowest was 41.45 in April 2009 during the bottom of the recession.
The survey focuses on ten key business activities, and respondents rate each area on a scale of one to 10. The July 2017 survey highlights include: Gross sales is 60.29, up from 50.13 in April, with an average of 57.93 and median of 59.76. This clearly shows the pent up demand from previous quarters.
Order backlog is 64.12, up from 61.00 in April, with an average of 57.36 and median of 59.06. This is very good news for the 3rd and 4th quarters. Employment levels is 54.29, up from 53.04 in April, with an average of 52.49 and median of 53.30. This shows hiring is strong.
Capital expenditures is 62.06, down from 64.50 in April, with an average of 56.00 and median of 56.48. This is still very strong. Product development activity is 63.64, down very slightly from 63.91 in April, with an average of 63.46 and median of 63.12. Still very strong and in line with the average and median.
Raw materials costs is 45.67, up from 43.48 in April, with an average of 45.02 and median of 45.11. This is normal. Employee costs is 47.65, improved from 43.33 in April, with an average of 46.60 and median of 46.51. This is also normal. Personal outlook is 64.29, up from 63.91 in April, with an average of 58.46 and median of 61.09. This is very strong.
"Although some think the slowdown with the large public companies indicates a general decline in the industry performance, at MADA, we disagree,” Dunlap said. “We are surveying many more than five or six companies. The growth is coming from the smaller under $50 million sales and fewer than 500 employees. I am still pleased to see the strength of the personal outlook index. It’s a purely emotional question but we put a lot of value on this content.”
The most frequently cited perceived threats to the industry’s success are material costs and healthcare costs Healthcare costs are the most commonly cited concern from respondents since this survey process was started in August 2004.
“Eight out of ten index values have improved and only two – capital and tooling expenditures - have declined. Only material costs and employee costs are below the ‘50’ level. We maintain the opinion that the industry will continue to grow steadily during 3rd and 4th quarters of 2017 and probably into 2018."
The July 2017 MADA / OFI Trends survey was sent to more than 450 individuals involved with the commercial furniture industry’s manufacturing and suppliers. The survey repeats in October 2017. For further information, contact: Mike Dunlap at 616-786-3524 e-mail: firstname.lastname@example.org, or at http://www.mdunlap-associates.com.