Around 10 p.m. on November 6, I looked at my wife and said, “$2 billion spent on a relentless barrage of stupid TV commercials, direct mailers and robo-calls—but nothing has changed!” Same President, Senate, House and gridlock. Never amused with politics and especially turned off by this year’s election, she calmly said, “Well I’m really busy” (in reference to her gift shop and custom framing business here in southern Wisconsin).
That really put things into perspective for me. Regardless of what is happening in politics or the economy at large, what matters most is what is happening in your market with your customers and your company. While many of you are disgusted with the way things turned out, and this looming “fiscal cliff” has many on edge (no pun intended), it’s probably not the end of the world.
Our annual Landscape Contractor Business Outlook shows that most contractors are feeling pretty good about where things are and where they’re headed. If there’s one thing that concerns me it is that optimism has been outpacing actual results. For example, looking back to last fall’s survey, 7% of contractors expected to see a reduction in maintenance business this year. Now, roughly 20% said their maintenance sales dipped. The same can be said for landscape installation contractors.
Contractors are heading into 2013 with a similar sense of optimism. I’m hopeful that actual results in 2013 will be different, though. There are several key economic indicators that are looking a lot better than they did last year at this time: new-home sales, new-home building permits, existing-home sales, existing-home inventory and existing-home prices. Since the housing market is a big driver of growth in this industry, those are good signs.
Other indicators are still concerning, though. The overall economy isn’t expected to grow all that much (some economists say 2% or so). A slowdown in business investment is one reason. There is also uncertainty as to what any kind of tax increases might do to consumer spending. It will be a bit before we start to get a feel for that.
It’ll also be a while before we get a feel for what the weather does. Nobody could’ve predicted what happened last year. It’s hard to imagine that something similar could happen again in 2013—but there’s no way of really knowing until it’s already happening.
So the best thing contractors can do is what they’ve had to do for the past few years. Have a well-thought-out plan, and an even better-thought-out backup plan. The good news is that if you’ve made it this far, you should be prepared for just about anything. At this point in time, just about anything is possible in 2013.
