The Mheda Journal

As I mentioned in yesterday’s post, the first part of 2008 was a whirlwind year for us here at The MHEDA Journal. The second half of the year was no different.

Our Third Quarter issue was devoted to that most ubiquitous of topics, service. We had articles about incentivizing technicians, service trucks and vans, the latest in diagnostic software for lift trucks, and even how to best service conveyors. In a time when customers are increasingly concerned about reducing their impact on the environment, we also had a series of Green articles, most notably this one from a MHEDA Distributor about converting your customer’s fleet to electric trucks. Add a convention recap and a host of other articles, and the July issue was a keeper.

We kept up the pace in the Fourth Quarter, when we published a series of more than 30 Sales Success Stories, highlighting some of the more unique applications of the last 12 months. Devoted mostly to sales and marketing, this issue also featured interviews with both young salespeople industry veterans, a feature about how one distributor is thinking outside the box to market his dealership, and cost-saving suggestions from distributors.

So yeah, it’s been a pretty busy year. Expect more of the same from us in 2009. Happy New Year!

With 2009 just around the corner, I got to thinking about all the interesting stories The MHEDA Journal took on in 2008. It started in our First Quarter issue and our Annual Industry Forecast from distributors and suppliers. Also in that issue was a forecast from economist Brian Beaulieu, which hit and missed a few things, but was compelling nonetheless; speculations about the next big technology to hit the industry; and the impact of overseas competition.

The Second Quarter issue featured a host of articles about Distributor-Manufacturer relationships and what makes a good partnership. Other topics included managing Workers’ Compensation costs, secrets for year-round employee satisfaction, and advancements in hydrogen technology. Of course, the Second Quarter was also the annual Convention issue, featuring articles from Convention Speakers and a guide to exhibitors at the Exhibitors’ Showcase.

We covered a lot of ground, and that’s only half the year. Tomorrow we’ll revisit the last two quarters. What a whirlwind 2008 was!

Happy Holidays, everyone! Have fun and be safe!

This time of year is notable for many reasons, not least of which is the massive number of people who use their saved up vacation time during these last couple weeks of the year. While I have no problem with people taking days to which they are entitled, it is more than a little irritating to those of us in the office to make repeated calls and getting no answer and no expectation of when that person will return. Humbug!

Here are some voicemail tips from the most recent issue of MHEDA Edge, our online publication for young professionals, that may help make everyone’s holidays a little easier.

Just a few minutes ago, President Bush announced a $17.4 million “financial assitance package” for the Big Three U.S. automakers. Like many people, my first inclination throughout this process was to say that they drove themselves to their precarious position through unsound business practices and should accept the consequences.

However, those companies have such an impact on an inordinate number of other businesses across the country that it seems imprudent to let them fail if we don’t have to. I applaud the move of the President and hope that there is some positive short-term effect moving forward.

As for the impact on material handling, that remains to be seen. But it would stand to reason that a boost to the automotive industry will be beneficial to those companies that supply the auto industry, which would in turn benefit material handling companies as they help make those companies more efficient. We shall see.

One of the most interesting parts of this year’s forecast was asking people what they thought the future beyond next year. The MHEDA Journal asked association members, “In what ways will the material handling industry be different in 10 years than it is now?”

There were some interesting responses, mostly involving whether industry consolidation would continue or not. Below were the top 10 member predictions:  

10 Bold Member Predictions

1. Vendor consolidation will continue.
2. There will be a greater reliance on Web-based sales.
3. The industry and its products will become even greener.
4. Independent distributors will be fewer in number and carry multiple brands.
5. Imported products will be more available and reliable.
6. Continued consolidation of customers will increase competition.
7. National accounts will be more prominent.
8. New industries will emerge for members to sell to and serve.
9. Diagnostic software will become even more proprietary.
10. Narrow-aisle market will grow as real estate becomes scarcer.

Pretty interesting, right? Obviously nobody knows for sure but if even some of these predictions come true, the material handling industry will be as dynamic as ever. For more information, see the First Quarter issue of The MHEDA Journal, due out in a couple of weeks!!

Throughout 2008, the economy was nothing short of a roller coaster. Initial reports called for a slow but steady year, and that’s how it started out. However, in late September, the bottom started to fall out. Mortgage giants Fannie Mae and Freddie Mac crumbled and took a bevy of financial powerhouses along with them. A few weeks and countless revisions later, the government passed a financial bailout plan worth well over $700 billion (and to be kind, the jury is still out on that decision).

The slowdown showed among a cross-section of surveyed MHEDA Members. Roughly 50 percent of participating companies reported lower-than-expected sales during 2008. Some reasons for falling short included a decline in the new equipment market, order postponements or cancellations, a generally weakened economy, a downturn in new construction and runaway fuel and steel prices.

There was a contingent of MHEDA members who prospered in spite of the down economy; about 38 percent of respondents had sales that exceeded projections last year. These companies attributed their results to aggressive marketing, acquisitions, increased e-commerce and improvement in maintenance.

For more details on this topic, read the December issue of MHEDA Edge, the association’s online magazine for young professionals.

Yesterday I mentioned that MHEDA distributors aren’t forecasting a whole lot of growth. The same can be said for material handling suppliers, about 40% of whom are expecting growth next year, slightly more than distributors. Those manufacturer/supplier companies are anticipating growth of about 14.7% over 2008.

So there is some optimism out there. Some companies are looking to grow through the down times and make things happen rather than mope about what “might have been.” From talking to MHEDA members, positive attitudes are prevailing, even though the numbers may not show it. Members are looking to focus on training and cost-cutting while sales revenues are tight, with the expectation to weather the storm and come out stronger on the other side.   

At this point, even people living under rocks must be aware that the global economy is, to be kind, sluggish. Financial institutions and automakers are asking for, and in some cases receiving, government bailouts. Stocks have plunged and unemployment is rising. What does it all mean for the material handling industry?

Well, it’s hard to say. Some in the industry are predicting major sales declines, while others are predicting moderate gains. All in all though, from what I’ve heard, it looks like the industry will struggle to grow in 2009. For each of the last 12 years, The MHEDA Journal has asked distributors to predict whether their sales will be higher, lower or the same comapred to the previous year’s. In 2009, barely 30 percent of MHEDA distributors are forecasting sales growth. More than 53 percent say it will be flat next year.  About 13 percent project declines.

So it’s all over the board. Obviously, only time will tell. Best of luck to all in 2009.

Welcome to The MHEDA Journal Editor’s Blog. We publish a magazine every three months, and that leaves a lot of time in between for important and interesting things to happen in the material handling industry. I talk to people in the industry nearly every day and receive all kinds of business news. I leave work every day with a new tidbit of information. For example, yesterday I read a fascinating article in Business Week that underscored the importance of succession planning in a small business. This is a topic of interest I’ve been hearing more and more from MHEDA members, yet many still don’t know what to do. That’s where our magazine comes in, by providing information that helps association members run their businesses better. Click here to read Succession Planning articles that have appeared in past issues of The MHEDA Journal.