Economic Indicators are Pointing Up!
Jay B. Hogfeldt
CEO Wind Mill Slatwall Products, Inc.
As the CEO of Wind Mill Slatwall Products, I had the opportunity to listen to
economist Brian Beaulieu of the Institute for Trend Research twice this spring.
Both opportunities were related to TEC 18, a business group of which I have
been a member for 13 years.
Brian’s twin brother, economist Alan Beaulieu, has spoken at several store
fixture and woodworking industry events in recent months including the ARE
convention last November, and the Stiles Executive Briefing Conference on
April 22, 2010. You can view a small portion of Alan’s presentation on the
video below. Both Brian and Alan echo the same economic predictions.
Brian confirmed that the US and world are in recovery mode now. Most
indicators, other than non-residential construction, are pointing “up and to
the right”. However, unemployment will remain problematic for some time
yet. Companies who had mass layoffs in late 2008 and early 2009 have
leaned out their organizations will be slow to re-hire. This is combined
with the fact that in prior recession’s, people moved to where the jobs were.
This is not as easy today since people cannot find buyers for their existing
homes or want to avoid a “short sale”.
The negative for the store fixture industry is that non-residential construction
has not hit bottom yet and will not until the end of 2010, as retail expansion
follows population growth and housing starts. Housing starts are beginning
to improve, but not quickly. In the mean time, there are many projects on the
table for remodels as retailers negotiate for empty space vacated by Circuit
City, Linens and Things, and others - see L.A. Times article. Wind Mill has seen
in past recoveries, and is seeing now; an uptick in Stock Slatwall Panels used
by various small independent and franchise stores. Many unemployed are using the
opportunity to invest their savings and open the small retail store they have
always dreamed about.
The key take-a ways from Brian’s sessions:
- Most of us will not see interest rates this low in our lifetime again.
Borrow money now. Borrow lots of it! As Brian says, “borrow so
much that you have trouble sleeping at night” - Taxes will never be this low again. Convert to a ROTH IRA and offer
a ROTH 401-K through your business. - Sell any bond funds you might have. As interest rates go up, and they
will, bond fund values will go down. - You must be, and remain a “hunter” for new business. It will not come to you.
- Spend your money now, before inflation devalues your dollar.
- There is a concern for 2014. Stay lean in preparation for a possible
small downturn. - Prepare training programs now!
- Make acquisitions since prices and multiples are at a low.
- Lead with a “can do” attitude.
- Dust off and evaluate your advertising and marketing programs.
- Review and update your competitive advantage.
- Establish tactical goals.
- As things recover, phase out low margin work.
If you are in the store fixture industry you are probably starting to see
things “fill the funnel”. We are seeing this at Wind Mill Slatwall Products.
Quoting is at an all time high, especially for Custom Slatwall Panels and
Slatwall Component Parts. The recovery is ON! We hope it is for
you, as well.
Best Regards,
Jay Hogfeldt
