Window and Door Jan/Feb 2012 : Page 21

Fig. 3 How Will Your Company’s Sales for the Coming Year Compare with the Previous Year’s Sales? 60 % OF RESPONDENTS 50 40 30 20 10 0 2006 2007 2008 2009 2010 2011 2012 n Increase Significantly n Stay the Same n Increase Slightly n Decline n Decline Slightly Significantly Fig. 4 How Will Your Company’s Capital Spend-ing for the Coming Year Compare with the Previous Year’s Spending? 50 45 % OF RESPONDENTS 40 35 30 25 20 15 10 5 0 2006 2007 2008 2009 2010 2011 2012 n Increase Significantly n Decline n Decline Slightly Significantly n Stay the Same n Increase Slightly again predict growth of less than 2 percent for 2012 ( Fig. 1 ). While the level of pessimism has not risen to back to the gloom and doom seen heading into 2009, there is a notable decrease in the number of manufacturers and dealers looking for moderate and/or strong growth in 2012 compared to 2011. It is worth noting that dealers and distributors are slightly more optimistic than manufacturers looking at the coming year. More than 60 percent of manufacturers are expecting slow growth for 2012, compared to just over 50 percent for dealers. Meanwhile, 44 percent of dealers are predicting moderate growth for 2012, compared to less than 30 percent of manufacturers. This year’s study once again makes clear that the boom years–when industry sales growth outpaced overall economic growth–are gone for now. More than half of the respondents now see the window and door business faring about as well as the economy in 2012 ( Fig. 2 ). In comparison to 2006, when housing soared and remodeling and replacement was enjoying steady gains, the drop in the number of respondents predicting the industry would outpace the economy has been substantial. It is notably down going into 2012 too, however. Nearly 15 percent of respondents thought the industry would perform better than the economy in 2011. Perhaps a reflection of the end of tax credits for energy efficient products, less than 7 percent of manufacturers and dealers see that happening in 2012. The clearest indications of caution looking ahead to 2012 are seen in executives’ predictions for their own companies. Last year, more than 70 percent of respondents predicted their companies’ sales would increase slightly or significantly in 2011 compared to 2010. For 2012, only 62 percent of respondents are predicting increased sales for their businesses ( Fig.3 ). The percentage of companies looking for sales to “stay the same” for the coming year has jumped to 29 percent for this year, compared to 16 percent heading into 2011. If there is optimism to be found in the numbers, it is a continued decrease in the number of respondents predicting decreased sales for 2012. Perhaps more manufacturers and dealers believe that at least the worst is over. Interestingly, while dealers are slightly more optimistic about the economy in general, manufacturers are slightly more optimistic than dealers about their company sales for the year ahead. About 65 percent predicted slight or significant sales gains for this year, compared to about 60 percent of dealers and distributors. Among manufacturer respondents, there was also greater optimism among those working for smaller and medium-sized companies. None of the manufacturers with more than $100 million in sales predicted significant increases in sales at their companies, compared to 11 percent for manufacturers with sales between $20 million and $100 million and 14 percent for those at companies with annual sales under $20 million. The Industry Pulse definitely reflects a new reality within the window and door industry. Heading into 2006, about half of the manufacturers and dealers predicted slight increases in sales. More than a third were forecasting significant increases. Although expectations have come back from a low point heading into 2009, they remain well below the heights of the housing boom. www.WindowandDoor.com 21

Previous Page  Next Page


Publication List
Using a screen reader? Click Here