Meredith O’Donnell’s 10,000-square-foot furniture warehouse is normally stacked with goods at least three racks high. These days she’s down a layer.
After a coronavirus pandemic shutdown, supply-chain problems and manufacturing backlogs throughout the furniture industry, O’Donnell and others are dealing with a new wrinkle: a serious foam shortage caused by the winter freeze that will likely keep the mattress and furniture world in its grips through the end of 2021.
February’s weather caused rolling blackouts and frozen pipes throughout the Houston area and beyond. In addition to homes and businesses suffering damage from busted pipes, factories and chemical plants suffered similar damage, requiring shutdowns and weeks of repairs.
Those include chemical plants that make propylene oxide, which is combined with other chemicals called “isocyanates” to make the polyurethane foam cushions for furniture, mattresses and even seats in automobiles.
When those chemicals aren’t available, anything that uses foam has to halt production as soon as their inventory is gone or limp along as partial shipments become available. Shoppers ordering furniture that has to be made just for them and furniture stores needing their warehouses replenished must wait weeks or months for deliveries.
Much of the country’s supply of propylene oxide is made in Texas and Louisiana by Dow Chemical, LyondellBasell and Shell.
LyondellBasell declined to comment on how soon they could be back to normal production, but in mid-March, the company’s CEO Bob Patel told the JP Morgan 2021 Industrials Conference that “10 percent to 14 percent of (annual petrochemical supply) along the Gulf Coast was taken out this year as a result of the (freeze).”
Patel said further that it would be “well into the fourth quarter before we see conditions back to normal in terms of adequate inventory levels across the value chain.”
Before the freeze, every supplier to the furniture industry was working at a frenzied pace trying to navigate safe practices during a pandemic, potentially sending whole groups home if one worker got sick and finding new suppliers of lumber, hardware and textiles if what they needed couldn’t make the trip to manufacturing plants.
It seems that when the country started working and schooling from home last March, everyone suddenly noticed how shabby or out of date their furniture was and decided to buy new. When factories reopened, they did so with a pile of orders.
International shipping became problematic, so any parts coming from overseas either meant a long wait or shifting to domestic suppliers — if their plants were operating.
“The hits just keep on coming. We’re still getting out from under the foam situation,” said Andy Counts, CEO of the American Home Furnishings Alliance, which represents furniture manufacturers. “Two key chemicals are produced in about five plants in Texas and they’re trying to get back (in full production).”
“Ten weeks, 20 weeks — I’ve talked to one company that’s gotten its delays down to eight weeks, but they usually have a three-week lead time. Backlogs will last through the end of the year at most companies,” Counts said, noting that of furniture sold in America, about half of it is imported from other countries. “Ocean freight issues continue to be a huge problem, too. It’s primarily labor issues at key ports like LA-Long Beach. It’s a big parking lot there with container ships waiting to be unloaded.”
Russ Batson, executive director at the Polyurethane Foam Association, described the process of liquid chemicals turning into spongy foam as something akin to baking bread. In the industry, in fact, they refer to the slabs of foam that become seat cushions as “buns.”
An inch or two of the chemical mixture — propylene oxide and isocyanates — is poured onto a conveyor belt and by the time it gets to the end of the line has risen to four feet or more.
When pandemic shutdowns began in March 2020, the broader furniture industry expected to head into a significant economic depression — not the busiest year of their careers, Baston said.
“Everyone cut back on inventory and orders to remain lean, but the economy bounced back to the extent that both foamers and furniture manufacturers and even a guy who makes beautiful high-end dog beds say this could be their best year,” he said. “This is the year they could tell their grandkids about — but they can’t get raw materials in sufficient supply.”
Foam fabricators and furniture manufacturers often didn’t keep a huge inventory of foam on hand because it was so easy to get, Batson said. Now, though, buyers might only get 40 to 60 percent of their usual deliveries, meaning they can’t finish furniture until the supply increases.
For shoppers, that means being willing to wait months for special orders and custom options or buying off the floor of a showroom such as O’Donnell’s, or a retailer such as Gallery Furniture.
“We have 100,000 square feet of showroom and warehouse space, and we turn it over three times a year, so we’re pretty nimble,” said Gallery Furniture owner Jim “Mack” McIngvale. “You can buy from other stores and wait 26 weeks or buy from us and wait 24 hours. We go to vendors all over the country and ask what they’ve got and buy it. We buy it, we sell it and then we get some more. That’s how we work.”
O’Donnell said that 40 to 50 percent of her business has been special orders — meaning someone wants a sofa or chair but in a different fabric, so it has to be made for them by the manufacturer. The rest is merchandise sold off the floor of her 18,000 square foot showroom on Old Katy Road.
Rainey Richardson’s RR Home showroom in the Houston Design Center is suffering, too. She occasionally sells furniture off of the floor, but most of her sales are special orders. Those are grinding to a halt, she said.
“Anything that is upholstered furniture we automatically assume it’s not available now. It used to be that you could get ready-made furniture from Universal or Bernhardt … now, everything is on back order,” she said. “Norwalk is keeping its lead times pretty close, but they have 8,000 pieces of furniture ordered that are waiting to go into production.”
When one vendor informed her that they couldn’t deliver new orders for 24 to 26 weeks she decided to pull the line off of her showroom floor.
“Nobody wants to order furniture and wait six months,” Richardson said. “We just have to wait and let it work itself out. It will work itself out.”
Interior designer Julie Shannon said she’s been busier than ever as clients use money they might have used for vacation to launch remodeling projects, and they’re getting used to longer waits on everything from appliances to furniture.
“The effects of COVID have put us into this situation. It’s such an abnormal world but we’re learning to live in it,” Shannon said. “It’s out of our hands. You can only do what you can do, and then you learn to be more patient. We’re such a want-it-here-and-now, instant gratification kind of world.”
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