ISHN

Smeaton’s Crystal Ball for 2013

January 4, 2013
Most of the Safety Equipment Manufacturers and Safety Equipment Distributors in 2012 saw a great increase in sales during the first quarter of 2012; quarters 2, 3 and 4 were not as good as the first quarter 2012. 1st quarter 2012 was approx. 17% ahead of previous year and year end approx. 7-9% ahead of year end 2011.

In the past 2 months I have listened to 3 different “Economists” and they all basically said the same thing in regards to 2013….2013 will be a flat year, expect anywhere from a -2% to a 2% increase in 2013. My Safety Marketing Group budget will be in the high teens. (8-9% increase over 2012)

What’s driving safety sales?

Some the drivers that will effect growth in 2013 will be the following:

 Oil & Gas Industry (Energy) should drive additional growth in the FR Clothing Category and other PPE Categories (Except for Wind Energy which will be down in 2013)

 Hopefully we will continue to see growth in the New Construction (Residential and Commercial) which will help create some demand for Fall Protection equipment, Head Protection and High Visibility Garments.

 Utility Markets should see additional growth in 2013 which should bring additional sales in the FR Clothing and other PPE products.

Potential barriers to growth

Some drivers that will negatively impact growth in 2013:

 Federal and Local Government spending will be down in 2013.

 General Industry / Manufacturing will be flat or down in 2013.

2013 will be a difficult year for Safety Equipment Manufacturers and Distributors due to the sluggish, anemic economy. It will be all about improving market share and profitability.

As I mentioned earlier, SMG will be budgeting a 8-9% increase in purchases over 2012 because our model works well in a stagnant economy; our SMG Distributors are all Independently Owned Safety Equipment Specialists that provide additional “value” to their end-user Customers and our Distributors are always looking for ways to increase their purchases from our Preferred Suppliers.