The Mheda Journal

The economy continues to dominate conversations I’m having with members. Some people are seeing little or no impact in their sales. To them, I say, count your blessings. Because they certainly appear to be in the minority. Numbers released yesterday said that the U.S. economy slowed by 6.2% in the fourth quarter, more than expected by economists and the biggest slide in about 25 years.

Within the material handling industry, at least on the distribution side, I don’t have any solid numbers, but anecdotal data suggest many companies are off by upwards of 50%. It’s a tough time. Those who have not yet felt a decline most likely will soon unless things turn around quickly. I’m not an expert in these things by any means (if I was, I may have waited to buy my first house last September), but that’s just the sense I get.

My goal is that soon I will have something else to talk about with members. That day hopefully is just around the corner. In fact, what else would you like to talk about? I’m open to suggestions!

With the signing into law of last week’s Stimulus Bill, there has yet to be a discernible improvement in either the economy or attitude among investors. Hopefully that will be coming soon. But here’s one thing that may be of note within the bill itself.

The bill includes provisions, effective March 1, regarding the continuation of health insurance coverage (continuation coverage) that covered employers must make available to certain former employees and their families under provisions of the “Consolidated Omnibus Budget Reconciliation Act of 1985” (COBRA). The National Association of Wholesaler-Distributors has prepared an outline of the key provisions of the Stimulus Bill that touch COBRA continuation coverage and how employers may be affected. The outline can be read here. 

With everyone looking for ways to save a few bucks, it was interesting to talk to a member who is encouraging the use of workforce training grants, which businesses can apply for to help educate and train their employees. The grants are available from many states and are typically funded by the unemployment tax dollars paid by business owners. The process to apply varies by state, but usually involves writing a formal proposal outlining what the training is for, how the employees will benefit, why it will make them stay at your company and what the training will entail. It may be necessary to hire a grant wrtier, but depending on your writing skill, maybe not. Usually, grants are awarded on the condition that thte company will provide some sort of in-kind match to balance out the cost of the training. There are several other variables that may differ from state to state, but it may be well worth a business owner’s time to research what is available in your area.

It’s interesting. The more people you talk to about this economic situation and the more you think you know what’s going on, the more you realize that you don’t know anything. Expectations and results are really all over the board. I talked to two MHEDA members this morning and asked both how this downturn compares to others they’ve experienced in business. The first person said:

“Well, this is probably the most serious down economy I’ve experienced in my 32 years in this industry. I’ve experienced other downturns, but I’ve not experienced the downturn that has happened as rapidly as this has had, and as broad as this is. It’s affecting every industry and every business in some form or another.”

The second said:

“In past recessions, your interest rate was so high that it exacerbated it. I think what’s softening this blow is that the interest rates are so low. I don’t think it’s worse, and I think that’s why.”

Bear in mind that these conversations were about 15 minutes apart, and these two people have similar-sized companies and aren’t that far from each other geographically. I guess it all depends on circumstances.

Will the stimulus bill help? As I write this, it appears that it will finally get passed in the next few days. I’m sure it will help some and not others. It all depends on your circumstances. We’re living in an interesting time, that’s about all I can really say at this point. What do you think?

In my last post, I talked about how the environmental movement among the general population has had a profound impact on material handling. As more and more businesses look to reduce their “carbon footprints,” they are turning to their material handling equipment providers to help them.

Some of the time, this is done through regulatory measures, such as those implemented by the California Air Resources Board to curb emissions of forklifts and other similar-sized engines. Other times, the catalyst is a desire to spend less money on energy, particularly in times like these when it’s important to watch every dollar. Other companies simply want to be a good corporate citizen and have altruistic motivations for wanting to preserve their environment.

Whatever the reason, it’s a trend that is not going away anytime soon.  What can you do to help yourself or customers capitalize? Here are few articles that may be of use. One distributor describes how he helps customers convert their fleets to electric trucks. Another talks about the energy-efficient lighting systems he’s installed at customer sites. There’s a lot going on out there…hopefully this can help you and your customers save money, and the planet!

We’re always looking for “green articles” to publish in The MHEDA Journal. The sustainability/enviromentally friendly trend is a big one in the material handling industry and it’s something that members are definitely interested in talking about. Here’s a link to a few of the articles we’ve published on the topic.

So it was with great interest that I stumbled across this blog entry from MHEDA Member Ron Gilleland at Bluff Manufacturing. They are taking a stand against printed product literature by eliminating lengthy product catalogs and instead providing one short document for all their products and then offering all those documents online. Gilleland says:

“It does not matter if you and I can agree on the cause of problems, but we must recognize when a problem exists and do the right thing.”

I couldn’t agree more.

It’s just one example of the prudent things companies are doing to save the environment (and cut costs at the same time!). Kudos to Gilleland and Bluff! Any other examples out there, i’d love to hear them!

I’m a little behind reading my e-mail, so I was catching up on some few-days-old New York Times headlines this afternoon, when I ran across this teaser in Monday’s: “The tension between Apple and the music industry stems from Apple’s power over the industry, but it also echoes the traditional divide between suppliers and distributors.” I didn’t read the article (you can do so here), but the “traditional divide between suppliers and distributors” part is what did get my attention. 

This is a topic that is not exclusive to the music business. We’ve written extensively about it in The MHEDA Journal over the years. In fact, it’s one of the reasons that MHEDA even got started, because distributors were fearful of the power exerted over them by the manufacturers. But as associations like MHEDA prove, manufacturers and distributors can live in harmony if both sides are willing to communicate. It’s a relationship that we may see tested as the economy continues to struggle, so this topic will remain endlessly fascinating for years to come. What do you think? What are the keys to a good M-D relationship?

The latest issue of MHEDA Edge, MHEDA’s online magazine for young professionals, was sent today to subscribers. If you haven’t had a chance to check it out, you can download a copy at www.mhedaedge.org. Or let me know and I can add you to the mailing list.

This month’s issue has great tips in it for little things you can do at your company to elevate your status and boost your career–things like having lunch with a colleague and picking their brain or joining a networking group. Also in this issue is a recap of MHEDA’s presence at ProMat for those who were unable to attend and a closer look at the economic situation as we plow through 2009.

I hope you enjoy this month’s issue and let me know if you have an idea for an article. What should we be talking about out there?

Well, Punxsutawney Phil, the iconic groundhog, saw his shadow today. That means six more weeks of winter for those of us here in the Northeast. Not the greatest news in the world, but on a related note, check out this classic issue of MHEDA Edge, one of my favorites that I’ve ever helped publish. This originally was released on February 2, 2007. Learn the lessons of the Groundhog!! (Note: If the first link above doesn’t work, go to www.mhedaedge.org/pastissues.php and scroll down to the February 2007 issue.

Check out this link:

http://www.informationweek.com/news/industry/technology-telecom/showArticle.jhtml?articleID=213000400

How cool is that? My favorite part of the article is, “The forklift can also run in the traditional manner, with an operator on board, if necessary.” Well, that’s good. Humans still have a chance!

I’m just kidding, of course. But seriously, stories like this are why I love writing about material handling. What a great industry that provides solutions to real-life problems (in this case, avoiding getting shot at while unloading a military supply truck). I want to find out more about this piece of equipment, so keep an eye open for more about this little experiment in an upcoming MHEDA publication.