Michael A. Dunlap & Associates, LLC unveils the results of the 39th edition of its quarterly MADA / OFI Trends Survey, a unique tool that designed to measure the current business activity of the commercial furniture industry and its suppliers. This survey was completed during the month of April 2014.
The survey focuses upon ten key business activities, with respondents rating each area on a scale of TEN (the highest) to ONE (the lowest). 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 unique element of this survey is the establishment of an Industry Index Number to quantify where the industry is currently performing. For example, 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”.
The April 2014 Overall Survey Index is (54.61), which is incrementally higher compared to January 2014 at 54.36 and October 2013, which was (54.35). The highest recorded Index was 59.72 in July 2005; the lowest was 41.45 in April 2009. The average overall index is 54.31 since the survey started in August 2004.
“The industry continues to move on a very steady and improving trend line. This is good news. The Overall Index continues to remain well above “50” and is definitely in line with the 39 Survey average. The industry is on course to achieve it’s best year in more than a decade.” Mike Dunlap commented.
The April 2014 survey highlights are:
• Gross Shipments measured 53.48, lower than the 39 Survey Average of 57.25 and Order Backlog recorded 56.12, which is slightly below than the 39 Survey Average of 56.44.
• The Employment Index of 53.27 is well above the 39 Survey Average of 51.84 The Hours Worked Index rose to 54.67 and is slightly below the 39 Survey Average of 55.26.
• The Capital Expenditures rose to 58.09 and Tooling Expenditures rose to 55.87. These compare to their 39 Survey Averages of 55.39 and 55.61.
• New Product Development improved to 62.98 but still below the 39 Survey Average of 63.33.
• Raw Material Costs rose significantly to 44.57 but is much better than the 39 Survey Average is 44.14. Employee Costs dipped to 45.43. The 39 Survey Average is 46.82.
• The Personal Outlook Index slipped from 64.62 to 60.80 and is well above the 39 Survey averages of 54.31.
Dunlap stated, further “The increases in Gross Sales and Order Backlog index values are not surprising, as both have been improving since the first half of 2013. They are still on solid ground. The same is true for the Employment Levels and Hours Worked index values. Both manufacturers and suppliers appear to be equally affected.
“The modest changes in Capital Expenditures, Tooling Expenditures and New Product Development are mixed when compared to their 39 survey averages. New Product Development remains strong.
“The changes in Raw Material Cost and Employee Cost index values are always a concern and rarely show much improvement.
“Although it slipped from the previous quarterI am 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), the costs of materials and healthcare are the most commonly cited concerns from respondents since this survey process was started in August 2004.
Dunlap again thanked the respondents with this comment. “Over 61% of the responses came from executives who are the Chairman, CEO, COO or President of their organizations. I am always extremely grateful for their participation and support. Their suggestions and recommendations are crucial to the performance and improvement to this unique survey.”
Dunlap continued, “This is the 39th MADA / OFI Trends Survey. We started conducting it in August 2004. The flatness in the Overall Index is a good sign. It confirms that the industry is continuing to grow and albeit slowly and steadily..
“ Seven out of tden Index values have improved and only 3 declined, eight of them remain above the ‘30’ level. I maintain the opinion that the industry will continue on its steady growth period in early 2014, then see some acceleration during mid to late 2014.
The April 2014 MADA / OFI Trends survey was sent to more than 750 individuals involved with office furniture manufacturing and suppliers from Africa, Asia, Australia, Europe, North and South America and from companies ranging from more than $1 Billion in sales to less than $10 Million in sales. The survey repeats in April 2014.
Michael A. Dunlap & Associates, LLC, is a consulting firm that focuses upon issues involving the working, learning, healing, and hospitality environments and furniture industries.
These include strategic business and market planning, furniture industry trends, Market Entry, Global Partnerships, & Collaboration, Author, Presenter, & Speaker, Mergers, Acquisitions, & License Agreements, Expert Witness Services in Products Liability, and Independent Rep Sales Team Development.
Source: Michael A. Dunlap & Associates
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