The fact that the pandemic has kicked butt and taken names up and down the furniture industry is hardly breaking news.
However, a just-tabulated survey of members of the International Home Furnishings Representatives Association sheds some new light on where and how the Covid-19 virus has hurt independent home furnishings reps the most.
The major takeaways from the survey, unfortunately, confirm that a significant number of reps have lost income, customers, and in some cases, entire lines due to complications from the Covid-19 virus.
When asked how soon after the virus was officially identified (in December of 2019) was their business impacted, 13% of the respondents said ‘immediately’.
An equal number of respondents said they felt an impact within a month, but the largest group—67%—said an impact to the business was noticeable with the first three months.
Another pain point from the pandemic was seen when the respondents gave specific ways in which their businesses were hurt. Here, the reps gave multiple answers and explained that the pandemic had hurt their businesses in several ways.
Having their retail customers not wanting them to call on them in person was the answer given by the majority of the reps participating in the survey. That was followed closely by “my factories began suspending production” was next.
Not far behind was a confirmation that product production and delivery were-and are-being interrupted. The fourth most often issue involved commission checks either being delayed or not paid.
The survey also asked the reps to share how their businesses have been impacted since the pandemic hit.
As one might expect, the top answer, given by 38% of the respondents, had to do with serious delays and interruptions in production. Not far behind was the confirmation of skyrocketing container prices, which were mentioned by 26% of the group.
Another 11% cited increased costs for raw materials.
Subsequent worker shortages were mentioned by another 5% of the group with 3% pointing to increased transportation costs. Worth noting, 16% of those surveyed said that all of the impediments listed were very problematic.
Since most independent reps get paid a commission when the products reach the retailer, the ongoing issues with interrupted production, high container costs, and longer and more expensive transportation costs have hit independent sales reps in their wallets.
The severity of this reality was confirmed by the IHFRA survey, which found that 38% acknowledged that the pandemic had ‘hurt their income.”
Just under a quarter of those responding said that the pandemic had ‘caused them to lose customers.’ Another 23% maintained that while they have been able to hold on to existing customers, those relationships have suffered as a result of the Covid-19 virus.
The virus has also hurt relationships between reps and their factories, according to another 11% of the respondents. The picture was even bleaker for 5% of the survey participants, who said their factories let them go due to the pandemic.
When asked to share specifics regarding the pandemic and their compensation, some 30% described their compensation as being ‘greatly reduced.’ Another 28% reported that their compensation had been ‘slightly reduced,’ and 10% said they had seen no change in their compensation.
Among the reps that had fared better were the 15% who reported that their compensation had ‘slightly improved’, while another 13% noted that their compensation had ‘greatly increased’. Another 5% were not as lucky, reporting they had lost their lines due to the pandemic.
The survey also queried the group about how and when they were paid their commission checks. Almost all said they got paid when the order was shipped to the customer.
With the supply chain in disarray, and with products back-ordered for months, their answer underscores the financial stain most independent home furnishings representatives are currently under.
Finally, the survey asked the group to weigh in regarding when they thought their compensation might return to pre-Covid levels. Twenty percent of the group was hopeful, indicating they thought compensation levels would return to pre-Covid levels by the end of this year. A much smaller group, 5%, pointed to sometime early in 2022.
Another 25% said mid-2022, and the largest group, 25% said not until the end of 2022. The remaining 18% were nowhere near as optimistic—as they said they did not believe their commission levels would ever return to pre-Covid levels.
Methodology: The survey was sent via email to 1,500 active members of IHFRA. 160 members responded, representing a return rate of just under 11%.
