The 2nd quarter tED magazine/Baird Industrial Research study shows significant revenue increases for distributors and manufacturers in the spring, and plans for a strong remainder of 2014.
The first quarter of 2014 was saddled with severe winter weather that brought many numbers way below expectations. The concerns were when the recovery would begin, and how big would it be.
Some of the quotes from survey respondents on the recovery include:
“2Q picked up quite a bit nationally, and in the north and east, making up for brutal weather over the winter.”
“Better weather in 2nd quarter really unleashed the pent-up demand from lousy weather 1st quarter.”
“Stronger recovery after weak winter due to weather.”
Distributors and manufacturers who took part in the survey also say the momentum behind lighting is starting to be felt. Two of the responses are:
“There’s high demand because of the cost save opportunity with LED.”
“Documented cost savings? Lighting is certainly at the forefront.”
Still, pricing pressures exist, and it appears there is growing concern over upcoming price increases.
“Manufacturers and customers both remain aggressive.”
“There’s slightly less pressure as trend pick up, but customers are still watching the dollars and cents.”
“We are seeing moderate pressure on our margins primarily by local competition.”
“We need to get a price increase we are just not sure the market will accept it.”
“More complete assemblies and solutions wanted by customers. Commodity item pressures from internet providers.”
There is some strong upside to the recovery from the difficult winter of 2014. People who responded to the tED magazine/Baird survey are still anticipating a 3.8% revenue increase for the year, despite the winter slowdown. That comes with expectations for a 5.5% growth during the 3rd quarter of 2014.
“Commercial construction backlogs are very strong.”
“Our backlog is definitely firming up.”
“Construction market is emerging from bad weather doldrums in a big way.”
“Strong market in new construction projects.”
“Backlog has increased to the largest level in 2 years.”
“Spring weather created significant project delays so we are now entering our peak business period and anticipate it to be very active the next 4-6 months.”Tagged with tED