The Connecticut River rises in the mountains of Vermont and wends its way through four states into Long Island Sound and eventually the Atlantic Ocean. The Connecticut River rises in the mountains of Vermont and wends its way through four states into Long Island Sound and eventually the Atlantic Ocean. Along the way it historically provided the water power for hundreds of industries, among them the American precision machining industry that was born in Vermont. These hundreds of companies, now spun off into thousands, are the backbone of Yankee industry; many of which are small family-owned shops trying to adapt to the 21st Century through changing technology.
Yankees are a stoic bunch, not given to outward emotion; so when surveyors come asking for their outlook on the economy the Yankee turns taciturn and as a result those conducting the survey can be confused by the statistics that result.
Prior to last week’s Eastec in West Springfield, MA, held along the banks of the Connecticut River, forecasts of a reduced and non-buying attendance were common. But the Yankees proved the soothsayers wrong and they turned out in very large numbers to "kick the tires" on manufacturing equipment that will allow them to compete in a global economy. And no one was more pleasantly surprised than me, maybe because I don't qualify as a Yankee, since my family roots only go back 100+ years here. My wife’s go back 300 so she qualifies.
According to the organizers, the SME, attendance this year was down about 12% from 2008's approximately 13,700 and the number of exhibitors was down about 5% to 580. Not a bad showing in what is proving to be a soft year for many trade shows. Yankees are also known to be shrewd so maybe they sense a change about to happen.
For lasers Eastec was a marking show with a dozen and a half suppliers exhibiting their products, most of them in one of the five building exhibit spaces at the Big E Fairgrounds. There cheek-by-jowl were a baker's dozen of companies each showing the latest in laser marking/engraving technology. It was a powerful display of laser technology, so much so that one visitor was overheard saying to his partner, "Just look at all these #*@%& lasers!"
I spoke with representatives of each of the equipment suppliers and asked how they are managing in an unusual down year for laser marking sales, and how they view prospects for the rest of the year. I also asked their opinion of future opportunities for continued growth along the lines of the past three years.
Not unexpectedly consensus ruled among the answers received, after all this is a trade show and optimism is usually prevalent at shows. These suppliers reported mixed results for the year so far with most companies citing spotty successes but all admitting that sales are off compared to last year. A frequently heard comment was that buyers, and they are still out there, are shopping more assiduously, often asking for quotes from six or more suppliers. This is counter to previous years when, at most, three companies might bid against each other. One buyer has an Excel analysis of more than two dozen suppliers that lists all equipment specifications so that he can just click on a characteristic, marking area for example, and compare all the suppliers. So making a sale is tough but there are sales being made.
Suppliers favor a six-month horizon right now where they expect sales to increase slightly in the fourth quarter and really pick up in the first half of 2010. The trouble with six-month horizons is that they have an annoying habit of stretching out.
The suppliers all agreed with me that laser marking will likely lead the recovery in the industrial laser market. The reason: the technology is far from saturation, demands from regulatory actions are still in place, and, more to the point, business will respond quickly to consumers reentering the retail markets.