MIXED INDICATORS FOR HOSE AND SEALS
By Staff -- Industrial Distribution, 12/1/1998
Hose and sealing distributors see markets tightening with intensified competition as slowdowns continue in some manufacturing sectors."I think with the fact that people are not buying as they have in the past, every distributor is scraping for every order they can get. It makes it highly service-customer oriented," says NAHAD president Thomas Slater.
"I don't think business is as good as it could be, it could be better," says Slater, who is also president of Rubber Supply Co., Inc. in Morrisville, Pa. "We're probably going to have a small increase this year but nowhere near the growth as in the past five years. The competitive situation is worse and [it] will cause margins to be less.
"Regardless of whether [customers] are in the chemical, food or steel industry, they all seem to be on a relatively slow pace so far," he says.
Joseph Thompson, executive vice president of the National Assn. of Hose and Accessories Distributors, says NAHAD members have mixed expectations and he has no clear sense of what next year will bring. Anecdotal evidence of the turbulent economy surfaced in a small number of firms that made late cancellations for the Independent Sealing Distributors annual meeting in October, he says. One distributor that suffered heavily from last summer's General Motors' strike opted out, while a half dozen Canadian distributors canceled because of problems triggered by their country's currency devaluation.
The pulp and paper industry is one sector that has been hit hard by the Asian financial crisis, which sliced demand for North American-made goods, for example. Richard Hall, president of PRC Industrial Supply in Portland, Maine, said there were no significant slowdowns in orders yet from the paper industry early in the fall. But several manufacturing plants in northern New England announced closings while a few paper mills issued layoffs.
Meanwhile, NAHAD board members hope to find a new way to provide members with industry forecasts and economic trend reports. Thompson says he expects to research resources, such as compiling data from related industry groups, and make a proposal to the board in a few months.
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