“We’ve also cut the office hours to three days a week,” he said, adding that with April 2 being a national holiday, the company stretched it into a long weekend and will do the same over the May 1 International Labor Day holiday.

He added that the shift is tied to two major components the company is trying to manage. The first, he said, is working with customers to manage the current backlog. For instance, he estimated that 40% of the backlog the company had three weeks ago has either been cancelled or pushed out to later dates.

“The second (component) is trying to find that crystal ball to know when business is going to open up and things can begin to flow again.”

Harvey Dondero, chairman of upper-end case goods manufacturer H. Nicholas & Co., said that the company has achieved cost savings by reducing the number of open and filled positions. This is in response to anticipated delays in demand for collections that were to be produced in the summer and fall that are now moved further out.

“These positions were taken out of the work force,” Dondero said. “We also reduced positions based on a lower demand forecast.”

He added that the company also has asked certain employees to take a reduced salary for a few months and has also implemented stricter just in time (JIT) requirements on materials and components purchasing.

In general, he noted, the drop in demand overall is having a broader effect on furniture manufacturing in Vietnam.

“With the obvious suppressing in demand in the U.S. and other countries, factories have gone to short work weeks and layoffs,” he said. “I understand some are considering shut downs of 30 to 60 days if their customers do not require orders shipped. Unfortunately, we are in an industry in which the consumer can delay their purchase.”

Thomas Luk, president of case goods and upholstery manufacturer Starwood Furniture, said that as of late March, the company had no plans to shut down its factory. However, he said that it has had some orders canceled or delayed and thus reduced all overtime the last week in March.

Luk added that he knows of other factories shutting down temporarily in the coming week due to delayed or canceled orders.

Mohamad Amini, president of Lacquer Craft, said that he, too, has heard of factories shutting down for two weeks or longer due to delayed or canceled orders. He said that while Lacquer Craft’s factory, Timber Inds., does not plan to shut down, it will “reduce the number of working days for now.”

“We will review orders and production status every week to see what the best course of action is,” he said. “I think that factory shutdown schedules and the timeline really depends on the U.S. shutdown.”

Tony Sulimro, president of case goods manufacturer San Lim Furniture, said that some U.S. customers have canceled orders and promised to issue new purchase orders when they reopen or return to work.

“Some customers have delayed orders and set a new delivery date,” he said.

In response, he said, San Lim will reduce its work force and also will reduce the number of working hours and days. Those who continue to work, he said, wear face masks and pay attention to “social distancing.”

“I believe all furniture manufacturers that export to the U.S. will face the same situation,” he said.

Others continue as usual

Not all companies interviewed for this story said they have had to reduce their headcount or overall production.

Luxury furniture manufacturer Jonathan Charles Fine Furniture said its efforts to diversify have paid off with a steady flow of work.

“Our current order books are largely for sold orders and hotel projects, and luckily, our efforts over the past few years to focus on spreading our eggs into different baskets finally has paid off,” said Jonathan Sowter, CEO. “OEM work, JC international business and hospitality projects seem to be benefiting the factory during these unique times.”

He believes that those factories being challenged the most depend largely on the top greatest 100 retailers that have delayed or even canceled shipments either to the factories themselves or to wholesalers that sell those accounts.

“Luckily, while we do work with some of the top greatest 100s, they are not the core of our business,” he said. “Small retailers, designers and project work are our core, and these represent most of our sold orders going through the factory right now.”

He added that the factory has stopped hiring right now as a preventative measure to protect exposing workers to newcomers that might be infected. But he said the plant remains on a six-day working week and overtime schedule for three evenings.

“We are aware this could change quickly, and we are learning to expect the unexpected, so we have plans on how to respond should we need to,” he said, adding that the company is also learning from its business partner and co-owner Markor Furniture, which already experienced coronavirus-related challenges in China.

“So it is sharing with us what it did and how it dealt with the challenges. … It really helps to have a big brother for support during times like this.”

Walter Blocker, owner of Stanley Furniture, said the company’s Vietnam plant continues to operate despite the retail slowdown being seen in the U.S. He attributed this to steps the company already has taken to adjust its business model even before the COVID-19 crisis.

“While the current situation has been very disruptive for the furniture industry in general, our journey to turn around Stanley through vertical integration and cost cutting has actually put us in a good position to fight through the complexities,” he told Furniture Today. “Our factory in Vietnam continues to operate today, and raw materials continue to flow.”

He also pointed out that the factory has excess capacity for OEM agreements that Stanley CEO Richard Ledger has been working to finalize over the past 12 months.

“Although capacity demand is off as an industry, there is still generally strong demand for Vietnam-based production, which offsets the China furniture tariffs,” he said.

Shutdowns not unexpected

Wholesalers in the U.S. said the temporary shutdowns of plants in Vietnam are not unexpected. This is not only due to temporary retail closures in the U.S., but also to the fact that many manufacturers have limited or no warehouse space for finished goods.

As orders slow, the only place some may have to store those finished goods is on the factory floor, something most manufacturers simply can’t — or aren’t willing — to do.

“Everyone is in the same boat, and that is why orders are getting canceled,” said Jamie Collins, executive vice president of case goods and upholstery resource Homelegance. “There is only so much storage capacity, no matter which side of the water it is on.

“The retailers and the distributors are in the same boat. We are all in this together. Beyond making sure everyone is healthy and making sure this virus is under control as soon as possible, we look forward to returning to a more normal business climate, whatever that looks like. And we hope it is sooner vs. later.”

“A ton of orders were canceled and pushed back, and factories had cuttings canceled and have adjusted production accordingly,” said Fred Henjes, CEO of case goods resource Riverside Furniture of the Vietnam plants. “Most of the ones we do business with … have slowed down their production and have reduced (the operation of) their finishing lines.”

He added, “They are trying to right size their production to what the demand is in the U.S.”

But Henjes also noted this is a balancing act as plants don’t want to shut down completely for fear of not getting their labor back when the demand returns.