San Diego, CA
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December 28, 2021

2021 problems in supply chain and how it affected furniture industry

At the beginning of the pandemic when we first heard the phrase ‘supply shortage’ no one really quite imagined what it’s gonna look like. We don’t think anyone did.

A situation with containers, shipping, and overall disruptions in the various industries didn’t develop in one day and wasn’t anticipated to transform to something we have today.

container shipping issue started slowly

Ports were overwhelmed during the majority of pandemic

We all know pretty much how and why this started, how it got to the point some wholesalers, factories, major retail stores have seen some unprecedented shortages, raw material cost increases, disrupted demand and such. We all remember what happened to some certain materials cost over the course of 2021 (hey, anyone remembers lumber?) and how people were scratching their heads with an inability to predict anything.

We can only point some things out that apply to our furniture market: demand for furniture, supply chain problems and overall disruptions.

Most of the home furnishings in the United States are imported, that’s not a secret. While China remains the largest furniture supplier in the world, it’s not only China - a lot of Eastern Asian countries have some major furniture supply chains, namely Malaysia, India, Vietnam and so on. We don’t even mention Europe that typically produces high-end furnishings - places like Italy and Spain remained closed for months. All parts of the world were affected.

While these markets experienced major closures, stoppages / etc. - the container crisis added up, with container prices skyrocketing during the whole course of 2021. According to some sources, general container shipping prices raised from roughly 4k to 40K. This brought all wholesalers, who largely depend on ‘not-so-large-margins’, but rather on the quantitative nature of business-to-business flow, to raise prices. These price increases added up to supply chain crisis.

Even domestic furniture manufacturers suffered - workforce problems, material shortages or unexpected price hikes affected everyone.

What’s worse, this process wasn’t linear and went through over a few hikes and changes during the course of this very challenging year. Some factories introduced temporary surcharges; some factories just updated pricing a few times during a year. It’s not fun to receive a new price list every month seeing prices for everyone - and what’s most important to the end consumers - are rising every month. It was extremely hard.

What’s more frustrating is inability to provide people accurate lead times. You could reach an end factory and the answer was ‘I don’t know’. Furniture warehouses typically stock supply needed for a few weeks and once it runs out everyone gets into a problem. End consumers start to shop around, especially closer to Thanksgiving / Christmas holiday time and find out 9 of 10 models they potentially want are out of stock, with restocking dates from a few weeks till ‘no one knows when’. This is frustrating.

empty-room-with-no-furniture

A lot of people have had trouble of finding any stocked furniture for their homes

Here, on comfyco.com we have no centralized system since all our suppliers are absolutely decentralized, so we can’t really list accurate stock info for most of them, asking customers to check stock in the shopping cart instead.

This led to a lot of strange situations where people place orders and all of those get cancelled next day, since nothing they want is available. By the way, comfyco.com never charges any orders - our pre-authorization as default on all orders allows us to keep frustration levels at minimum.

Overall problems in the labor shortages department also affected the furniture industry, because of the shortage of truck drivers. Just imagine that customer finally found something he can buy today, get delivered tomorrow, but … there are no drivers for this job!

We, however, are optimistic and see a future that’s coming back to normal. First of all, price spikes seem to stop for now - we can clearly see that. It’s a great thing. Secondly, we see some lines come back in stock since most factories overseas and in the US reopened. Yes, you can’t expect 100% supply in the nearest months, but it’s much better than it was 6 months ago when 9 of 10 orders got cancelled.

So if you couldn’t buy your dream bed or that special sofa you always dreamt about in 2021, do not be upset about it. 99% you’ll buy it in 2022. It might be a little more expensive, yes, than 2 years before, but you’ll get it. Inflation isn't going anywhere anytime soon plus price hikes would go down slowly.

Furniture and home goods of this nature is not a mandatory, essential product (unless you have no bed to sleep on), but in any case, we feel deeply for poor folks who were or are unable to buy what they want for weeks and months. It's understandable, it's frustrating, it's inconvenient, but ... it will pass.

We also think that this major shakeup was probably a positive thing overall. Those who are or were bad at what they do or were highly inefficient, will reformat or close, and those who are better will evolve and become even better for all our mutual benefit. It's just a nature of the market, after all.

2021 taught us a few things, but one is really important - patience. Just with a little bit of patience we will see the industry complete recovery and we will see it very soon!

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