Economic Forecast Opinions?

Maine Doug_74

solar for the radiant floor at the rate oil is climbing in cost.

Darin Cook_5

What will the winter hold for work?

Work is busy now ( thank goodness) after a terrible late winter/spring but what will the upcoming winter hold for the economy if people are doing all they can just to pay their heating bills and buy gasoline. Does anyone think that their hvac business will be sliding into hard economic times? I for one DO NOT want a repeat of this spring. I knew things were tough when vendors were making comments like wow, we're glad at least one contractor likes to keep his account current!

I would like to know how everyone did for work this spring, is doing with work now, and how they feel this winter will be. All opinions are welcome and appreciated.








Darin

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Rich Kontny_3

Outlook

Darin,
With almost 20 years of fast paced growth and little time to catch our breaths we are indeed in a recession. This is the worst I have have seen it since the early 80s.

Many of the steal from Peter to pay Paul type contractors can't find a Peter to steal from. They are in trouble. We are going through a major reality check and with no where to go with the interest rates they cannot use that as a safety net.You are going to see a fair amount of contractors fail.

The frugal or well financed contractor will survive but not as they did because the consumer is looking for the best deal and they are in a buyers market (if they have the money)

We are in an adjustment period (shock may be a better word)where the consumers are ditching frills and are already looking at more fuel efficient heat sources, cars, appliance etc. There are many opportunities out their if we are able to adjust and change. It is no secret that the "green movement" is gaining momentum and in the next ten years it will become the norm. Over comsumption no longer will be looked at as a sign of success rather it will be looked down on. Smaller more efficient homes are the ones with a future not huge energy hogs.

This correction while painful is long overdue and we Americans will adjust and get through it. Right now I am sending quotes to 15 general contractors where I used to send to 6. We are probaly landing one out of ten yet we have enough backlog to not give work away.

I see a better 2009 but a very tight and competitive 2008

Hang in there!

Rich

Mike T., Swampeast MO

A relative of mine in the wholesale plumbing business tells me that collections are slower and harder than he's seen for decades. He was sure happy when I made a substantial advance deposit to my account in anticipation of upcoming purchases.

Forecasts are difficult, but given what happened in the 1970s during the last oil crisis, substantial general inflation seems inevitable unless oil price drops significantly and rapidly.

Provided the economy stays reasonably healthy otherwise, people will still be spending money--just in different ways. In fact, they may even be spending faster in the belief that some savings will be better spent before inflation erodes their value faster than interest/dividends add value.

Things like granite countertops begin to loose their shine when use of a far less expensive, but just as serviceable substitutes can be made allowing the use of more efficient (and better installed) HVAC systems.

Provided the economy doesn't utterly tank (sorry to say, but best chance I've seen in my lifetime) the renovation market for hydronics should grow with people feeling that some extra money spent now on fuel efficiency will be among the safest and surest investments.

Had I not replaced my perfectly functional cast iron boiler with a mod-con about 5 years ago, I could not afford such now via discretionary income. Such hurt my budget for about a year, but discounting my own installation labor, I already began receiving payback this past heating season.

Our local paper recently ran a warning regarind natural gas prices (the first I ever recall). The "typical" residential customer is told to expect a $100-150 increase during the upcoming heating season. Not too bad except when you consider that the "typical" customer is greatly skewed by apartment dwellers who often pay only for cooking/DHW gas only.

Robert O'Brien

Mike

"He was sure happy when I made a substantial advance deposit to my account in anticipation of upcoming purchases."

Why would you keep money in non FDIC,non interest paying "bank"

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Mike T., Swampeast MO

Cause he'd carried my business partner's personal account (without charging interest) for FAR too. Maybe dumb, but at least gentlemanly on both our parts.

Wayco Wayne_2

My Spring was ghastly.

I havent been so slow in a long time. I actually cleaned my garage AND my shed waiting for the phone to ring. The present heat wave has got the A/C thing going but I havent put a boiler in for a long time. I believe the other HVAC contractors are starting to offer the mod cons but don't know how to price it and are undercutting my price. I lost one job by price to a hvac contractor installing a WM Ultra and I was pricing a Prestige which is less expensive around here. (He was also over sizing from what I heard from the HO. "Oh yah, he's even giving me a bigger boiler than you for less money." What a maroon.) I don't know the forecast but I'm tightening my belt for now. Hopefully the smart folks will upgrade to high efficiency real soon. I'm also feeling out the Solar market and have a bid out on a small hot water system. WW

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Mad Dog_2

I've done that...and just for that reason.............

When I am hurting, My supplier is always there for us...when I can "help" them, I do. Mad Dog

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jp_2

unplesant necessity

sad but this is what its going to take to switch over from imported energy. like health care for everyone, it will cost us now but save us later.

Patrick_32

tough times for sure

We've had our worst two quarters since our company's inception about thirteen years ago. things are starting to crank up a little bit, but nothing like it used to be. We used this time to really streamline our business and consolidate as much as possible. We are hearing the same from our vendors as well. I feel that there will be some sort of small redemption, as far as work is concerned, this summer. We are reading predictions that things may pick up in the first quuater of 2009. Not going to hold my breath,though!

Maine Doug_74

Imported Energy.

Canada is the largest exporter of energy (oil, gas, electric) to the US and Mexico is around #3. It will be many many years before the US is weaned off "foreign" energy. I doubt we will ever see that day.

But the catch phrase foreign oil (or energy) serves as a good scape goat to point blame for our problems and is a favorite with the politico's. In the interim we do nothing substantial but speculate on oil futures.

mtfallsmikey

What's really sad

At least in my area, with the increased fuel/grocery prices, that HO's who really want to upgrade their heating equipment can't afford to do so without tapping the credit cards, or getting a home equity line to pay for it. Lots of people are tapped out financially.

ScottMP

unfortunately

Too many people don't know how to save or live within their means. I'm not saying these aren’t tough times, they are, but allot of this mortgage problem is from people who should have known better. If it sounds too good to be true.....

Lot of people use the card for everything when they should be asking first “Can I pay for this??" Living way beyond their means.

My first accountant told me " Never judge a mans income by the car he drives ". Most of them aren’t even paid for.

People need to go back to the days when they wanted something; they saved for it and THEN bought it.

We have met the enemy and he is us!

Scott


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Weezbo

we are in a particular time ...

it is difficulty upon difficulty and it doesn't take Joseph of the Bible to join the dots.

our industry has always been confronted in maximizing peoples comfort, physical comfort is important as is the financial comfort.. because of this we are looked to to help people make difficult decisions. i would say that we though mere servants in the Work are individuals who wear many hats.

for decades we have been banging away at the drum making a quiet murmur across the clashing and banging of the marketplace we still are taping away at it buh the REASON that we are beginning to be HEARD is the sound of silence is Deafening at the moment.

staying tuned to the world around you is important however i want to caution you to stick with doing a Good Work. When you have a call for a furnace down and you have to run to the store to get ten gallons of fuel oil to get it back up for a while you may be fairly certain that if the people did not have it to pay for the oil then likely they will not have it to pay you..:(

My heart goes out to young guys slaving at three jobs to keep a roof over their families head ,more vintaged citizens who put so much work into making the communities we have of today, and the families who have had their main stay ripped out from under them with business closing...in this particular time i think it will require MORE out of us than ever to continue the Work. The reason being , the more work you do to do something right the more opposition to the work at hand presents itself. i always liked the thought that if we fail not we will be the Overcommers. Timmie's perseverance and sticktoit tiveness should be an inspiration to any one weebling away at the knees right now.

last year we were lucky in that 60 below didn't hang in there very long, buh fixing things out doors uninsulated against the cold,funded out of the graces made it clear to me that people will do whatever they think they have to do to survive including spending Your time money and efforts to do so.

i think it important to help your family and community as you roll through life..

maybe what you do you might not see as making some big splash buh little by little one goes far.

i am still optimistic that ,when we do what we do, it is making a dent in others lives for the Good. Because we must do our work in this time of the year to prepare for winter people seeing us out there in the world are encouraged to do just that little bit more ...Look UP because sometimes the only way out is UP.

ScottMP

I here ya Weezy

And I am not beyond giving a bit when someone is down and out.

Unfortunatly the one of the worse legacy’s of the baby boom generations how little they taught there off spring about fiscal responsibility. Have not want not.

If you can't afford it, you don't get it. Doesn’t happen allot nowadays.

I know I sound cynical and there are many out there who are caught in these tough times which are no doing of their own BUT ... there are many who have made their own bed.

Scott


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Maine Doug_74

On has to wonder

about the long term stability of an economy based on consumerism. The auto ads and strip auto malls occupy a huge amount of space in our wolrd. Everything is geared to buying more stuff than we can afford or even need.

The Boiler Dr.

As so aptly stated elsewhere

in this thread.... Political rhetoric feeds off the most visible states of the economy ... food and fuel costs. The US midwest is reeling from flood devastation, the southwest and southeast from fires. While this may create work for some in those areas the people requiring this work are already financially compromised which only degrades the local economy further.

But have huge doses of "high price woes" really created a serious shift in the daily thoughts of the majority of people?
IMHO Not yet

While we have seen a small downturn, our business is still doing quite well i the current economy. I find a much more informed consumer is starting to ask hard questions about their comfort choices. Yes we still see the low ball bid as the choice of many, however thanks to sites like this and good dialogue by many highly trained informative volunteers I am starting to notice it is not always the lowest price chosen as frequently.

One of the most common questions I am fielding in this market relates to life cycle costing. In better than 80% of our head to head struggle with low price, life cycle projections have enabled us to secure the order. I think much more thought is being placed on use of discretionary income allocation relating to primary residences as compared to toys and transportation.

joel_28

challenges

While things seem crappy every time you turn on the news keep this in mind. This is an election year and virtually everyone in major media is a liberal nd wants the Dems to win. This negative talk about the finances all started to come up when things started going better for the war and the media couldn't keep hammering the red guys on it so much.

The media will hammer it all the way to election day. They have affected this situation as people at home go "gee maybe we shouldn't put on the familly room and remodle the bath look at those people loosing there homes" Even though the folks thinking this have secure jobs and interest rates are low. it really doesn't make sense it's mostly about how people feel.

We have the answers people need with good marketing you can prosper,easy? nope but you can do great.