Last year at this time (mid-March) I was already onto my second gallon of gas for the little push mower I use to cut my average-sized lawn in southern Wisconsin. This year I'm still shoveling snow and chipping ice off of my average-sized driveway. Mowing is a lot more fun, I must say.
But I'm happy to see a return to more "normal" weather patterns. Last year's early spring and subsequent mid-summer drought cancelled each other out. For most contractors, sales were no better nor worse than had been expected. All that was created was a lot of extra unpredictability and stress.
I think "normal" is a pretty good place to be. Housing bubbles and stimulus injections, for example, create "false demand" and eventually come back to bite you. A healthy market is one driven by honest-to-goodness consumer demand. We're pretty close to that now.
The housing market still has a little ways to go, but is recovering nicely. Commercial construction is picking up too. Lodging facilities were up 11.6% in January (as compared to one year ago), office buildings were up 9%, and manufacturing facilities were up 12.8%. Some areas of the country are hotter than others, of course. For example, our featured contractor this issue, Tony DiMauro of Sunset Landscape Services, says commercial activity around the Dallas area is almost back to where it was five or six years ago. Great news!
A return to normal where property managers' budgets are concerned is also great news. More of our readers have been telling us that this is the case. This all makes the selling of landscaping services a little bit easier.
But what about everyday consumers? Consumer confidence, and spending, took a dip in January after many consumers were shell-shocked by the unexpected expiration of the payroll tax cut. This type of things messes with people's minds. So do sudden spikes in gas prices, even though we should all be used to that by now. But the fact of the matter is: All of these things that chip away at a homeowner's discretionary income make it harder for you to sell your services.
So how do you make your services more valuable so they don't wind up on the chopping block? Consider some of the things which most consumers have not been willing to part with over the past five years: internet service, mobile phone service, cable/satellite TV service. Now consider some of things which consumers have been willing to cut: high-end jewelry, maid services, club memberships. Now consider some of the things that are starting to make a comeback: gourmet coffee, discount jeans and shoes, and casual sit-down restaurants.
What does this say about consumers at large? I see a society that wants to remain connected, just in different ways. They're also more willing to self-entertain. They care about their appearance and want to fit in, but won't cross a certain threshold in terms of what they have to spend in order to do so.
Is this what you see? If so, are you adapting your go-to-market strategy accordingly? Write me and let me know what you think. Good luck in 2013!
