Haverty Furniture(US:HVT)2019-03-04 21:43Economic Factors - A significant portion of the company's sales is driven by discretionary spending, which is influenced by economic factors such as interest rates, consumer confidence, and retail trends[47]. - The company has exposure to floating interest rates through its Credit Agreement, but does not anticipate significant adverse impacts from a 100-basis point change in interest rates[141]. Supply Chain and Sourcing - Approximately 70% of the company's total furniture purchases in 2018 were for goods not produced domestically, with 35% sourced from China[53]. - The company imports a substantial portion of its merchandise, exposing it to risks related to tariffs and trade policies, particularly concerning goods manufactured in China[52]. - The company relies on third-party producers for product supply, which may lead to operational difficulties if these producers fail to meet quality or production standards[56][57]. Competition and Market Dynamics - The company faces competition from a diverse group of retailers, including national department stores and independent specialty stores, which may impact market share and revenues[49][50]. - The company must anticipate changes in consumer preferences to maintain sales, as failure to do so could lead to declines in revenue[51]. Cost Management - The company is vulnerable to fluctuations in raw material costs, which could adversely affect profits and may necessitate price increases[54][55]. - Transportation costs are critical to profitability, as the company relies on a limited number of distribution centers to deliver products across 21 states[63][64]. Cybersecurity - Cybersecurity threats are a growing concern, and the company invests in security technology to protect against data breaches and cyber-attacks[68][69].