According to Jerry Epperson, a veteran furniture industry analyst with Mann, Armistead and Epperson of Richmond, Va.: "October 19th, about dinnertime (subject to change).
"I'm often delivering bad news so I try to bring a little humor into it," he said Tuesday night as he addressed the American Society of Furniture Designers during the High Point Market.
Epperson said modest economic growth should resume in the fourth quarter of 2009 and steadily improve through 2010 and 2011. But he said it could be late 2010 or 2011 before new home construction and employment levels improve.
"I just wish I had something more pleasant to talk about while you're dining," Epperson said, as he noted 20 percent drops in recent retail furniture store sales and similar double-digit declines in both domestic and imported furniture shipments.
"But we think retail sales have flattened," he said, predicting a 9.8 percent loss for the year but also noting that 2008 numbers were so bad that it wouldn't be hard to predict better sales by the fourth quarter of this year.
Epperson said sales categories that are stronger include promotional upholstery, mattresses and youth bedroom furniture, with formal dining most likely to be the last category to pick up in sales. Home office, entertainment cabinetry and casual dining are also beginning to show improvement, he said.
"The most positive thing going for us is existing home sales," he said. "Prices have fallen but that means some great home values for buyers. And there are incentives out there not only for consumers but lenders as well."
Those factors, combined with low mortgage rates, should lead to stronger existing home sales than expected for 2009, Epperson said.
He said an exception to that prediction would be in the fives states experiencing the biggest housing slump - California, Florida, Nevada, Arizona and Michigan.
"It's going to take longer to come back there," he said.
Epperson said he was "reasonably positive" about this market, although it got off to a very slow start. But he noted that with an official opening day of Saturday, many retailers stayed home at their stores before coming to market Sunday and Monday, which were much better attended days at market.
"And I was glad to see that some people had decided to break new ground," he said of some contemporary collections such as Lexington Home Brands' Black Ice.
In a question-and-answer session after his presentation, Epperson was asked if he believes domestic manufacturing might make a comeback.
"I think it's going to continue to erode," he said. "You can't resurrect it because of the regulatory restrictions in the U.S.
"It's going to be restricted to what's open now," he said, noting that once a wood furniture plant closes for 30 days it takes up to nine months to get federal permits to reopen. He also said that all the equipment is typically sold when a plant is closed.
He said Vaughn-Bassett, in Virginia, is the only company he is aware of that has "mothballed" two plants. He said they run the plants' finishing lines monthly to keep their permits.
Epperson said escalating restrictions from the Occupational Safety and Health Administration from the 1970s through the 1990s doomed many domestic manufacturers as they spent money to keep meeting ever-increasing standards that left them without capital to modernize or build new plants.
"Companies spent a lot of money putting Band-Aids on old plants," he said. "Essentially, 30 years of capital expenditures went down a rat hole. So we lost business because of us, not the Chinese. Most of it was self-inflicted."
Another question was about whether the Las Vegas Market threatens the viability of the High Point Market. Epperson noted that of the top five states with the highest foreclosure rates, one is Nevada itself and two others are nearby states, which doesn't bode well for that market's core attendance. He also noted that the Las Vegas Market doesn't have the size or breadth of product found in the 12 million square feet of showroom space in High Point.
"The town itself is in big trouble," he said of Las Vegas. "They've got problems in big neon letters.
"In the long term, if I had to place a bet, I'd put it on High Point."
