There's an interesting dynamic at play within the tool industry that I'm trying to figure out. On one hand, there are clear effects on the industry of the historic decline in new-home construction. It has affected everyone from jobsite subcontractors to tool store suppliers. We've never seen anything like these conditions, which some are calling The Perfect Storm: months and months worth of unsold housing inventory, subprime mortgage failures, and newly emerging credit problems all adding up to an unpredictable market and recovery time frame. As a result, some tool industry executives have told me, U.S. tool sales are down at least 5%.
Yet even within this economic environment, we've noticed no real reduction in the number or pace of new tool introductions from manufacturers into the market. In fact, new technology marches on despite the challenging conditions.
That interests me so much–and gives me hope–that even with all the bad news we hear daily, the tool industry is completely optimistic in its focus on developing and delivering new products, features, and jobsite solutions to pro tool users.
That's not to say that tool companies aren't financially challenged by the market as well. I know they are. You can see the caution signs when they cut back on their marketing or are absent from trade shows. But that doesn't stop the new tools. And there's something reassuring to me in knowing that tool designers and product engineers will go to work tomorrow to keep the pipeline full, even though nobody knows what the market will be like when the new products emerge from the other end. There is the optimism that a great new tool, a breakthrough feature, an awesome accessory can find life in any market –and the energy is infectious.
But as great as optimism is, there are other major factors also at work here. For one, U.S. market conditions aren't uniformly bad; there are still pockets of regional and localized strength. There's also the fact that while new-home construction is definitely hurting, residential remodeling and commercial construction have not been as affected, and in some markets are actually doing fine. Then there's the global economy that helps balance tool companies' bottom lines–in this case, European markets are helping to make up for U.S. losses.
Watching the tool industry as closely as we do, it is hard not to notice the mix of caution and optimism at work among our friends at many brands. It's like feast and famine at the same time. I guess for tool users, the good news is that as far as we can see, nobody is applying the brakes in terms of their investments in innovation and invention. Nobody is cutting back on their quality. And nobody is backing away from competing for your business.
These are all signs that the tool industry is healthy and strong–even if the market is not.
–Rick Schwolsky, editor in chief email@example.com