Coronavirus could cause ‘crisis’ in Mississippi’s furniture industry

While the COVID-19 strain of the coronavirus has roiled global markets, including Wall Street, the bug is already affecting one major industry in northeast Mississippi.

Suppliers and manufacturers in the region’s furniture industry said they’re concerned about the coronavirus and its impact on raw materials and other supplies critical to production in the U.S.

“We’re facing a potential crisis in the industry,” said Roger Bland, president and CEO of Southern Motion in Pontotoc.

The company, which also owns Fusion Furniture, employs some 2,100 people. On any given day, thousands of sofas, recliners and chairs are being put together using parts from China that can’t be found anywhere else.

“The bad news about the coronavirus is that most of the fabric mills in China are closed along with a lot of the mechanisms, springs, motors, a lot of raw material providers,” Bland said.

Most furniture manufacturers are reliant at least in some part to overseas suppliers, mainly due to costs. And most of the suppliers are in China. It’s a trend that started 20 years ago or more, with little abatement. Some suppliers can be found in Vietnam and other southeast Asian countries, but they, too, are often dependent on China and its superior infrastructure.

Suppliers overseas as well as manufacturers here in the U.S. were hoping the Chinese Lunar New Year would be the break needed to slow the virus. Typically, Chinese workers take a few weeks off to celebrate the new year and then return. This year, most are still on break, because factory owners are leery to spread COVID-19, which got its start in the Chinese city of Wuhan.

That has put the breaks on many production and delivery plans.

“We’ve been watching extremely closely,” Bland said. “Its going to impact work every day as this continues. I anticipate some facilities not being able to work at all. It also effects pricing, too.”

Lisa Hawkins, the owner of Room to Room Furniture in Tupelo, said furniture manufactures and accessories supplies have warned retailers to expect delivery delays, in addition to price increase.

Ashley Furniture Industries, the world’s largest furniture supplier, has told retailers it’s adding a 2% surcharge for air freight.

Jim Sneed, CEO of Affordable Furniture, said his company stocked up on raw materials and other components before the end of last year, mostly in anticipation for the New Year break. The timing couldn’t have been better as the coronavirus spread, but Sneed said he’s still concerned.

“We’re looking at supplier elsewhere of course, like Vietnam, but the problem there is they rely on China a lot as well. We’re all in the same boat.”

Bland said after April, “it’s going to be tight.”

“We’ve looking it really hard,” he said. “We’ve put our team to look for alternate supplies, and we’re in a situation being one of larger ones where we buy rolls and not kits. That gives us a little more flexibility. But I anticipate by April some interruptions to occur.”

Some companies will try to hold the line on raising prices as long as possible, but that’s not likely to hold in the face of growing demand and depleting supplies.

“When there limited product available, you’ll pay what you can pay to get it,” said, who, like many in the industry, has seen some silver lining to the cloud of tariffs.

“We just worked through tariffs, and as a factory we could deal with it,” he added. “But now the virus comes along and puts us in another tough spot.”

This story was originally published March 2, 2020 at 2:22 PM with the headline "Coronavirus could cause ‘crisis’ in Mississippi’s furniture industry."