It’s no secret the prices of most consumer goods are rising – used cars, appliances, and lumber are the most covered examples. Though there have been many articles written to explain why prices are increasing overall, we’d like to talk about furniture prices.
Back in March 2020, most manufacturers and raw material producers shutdown for months due to the COVID-19 pandemic. The economy slowed significantly that month, and though manufacturing stopped, companies were able to sell their products at pre-pandemic prices because consumer demand stayed high and they had excess inventory.
The economy began to surge in April 2020, driven by rising consumer spending. Retailers began to raise their prices, seeing that consumer demand was far larger than their inventory and manufactures output.
By June of 2020, most manufacturers had begun to operate in a limited capacity, but their output was far smaller than the current demand. At this time, the raw material producers began to send their excess stock (produced before the pandemic shutdown) and started production of new raw materials in a limited capacity.
From July 2020 through February 2021, consumer demand climbed while manufacturing and shipping delays grew. Most manufacturers were still operating at limited capacity; In our experience, consumers were patient and understanding of these delays, and continued to buy more. The 2020 holiday season was huge, overloading shippers and putting manufacturers behind.
In March 2021, the nearly weeklong Suez Canal blockage occurred, wreaking havoc on the global shipping systems and furthering the delay of manufacturing production. By this time, manufacturers and shippers had eaten a large percentage of these rising costs, and decided it’d become too much. They began to pass a small amount onto retailers.
In April 2021, the COVID-19 vaccine rollout allowed manufacturers and raw material producers to go back to full production. However, both still have a huge number of backorders to fill. Coupled with the continued rise in consumer spending, delays are continuing to grow.
Since the start of the pandemic, furniture manufacturers and raw materials producers have been behind. Regardless if retailers source their products from overseas or the USA, delays abound across the supply, manufacturing, and shipping chains.
This past year, Brown & Beam has made every effort to subsidize the rising manufacturing and shipping costs. The price of our (or any other retailers) furniture isn’t going to skyrocket tomorrow, but shoppers shouldn’t be surprised if furniture prices rise in the future.