What’s your Optimism Quotient? Wells Fargo Equipment Finance has released the results of their annual construction industry survey, and the numbers indicate optimism among both contractors and dealerships is the highest it’s been in a number of years. Against a benchmark score of 100 that indicates “high” optimism, the survey revealed a score of 124 for 2014. That’s up from 106 last year and a miserable 42 in 2009.
Interestingly, 55.4% of respondents say non-residential construction activity will improve over last year and 55.7% say residential construction activity will improve. Wells Fargo says it’s very rare for the two sectors of the industry to be so well-synched. But it further points to broad-based optimism.
Why do construction industry executives believe 2014 will be a good year? Three-quarters of them cited overall economic improvement, and more than half mentioned improving consumer confidence. But the construction economy still faces significant risks. Perhaps not surprisingly, the top factors cited by survey respondents were economic uncertainty, political uncertainty, rising interest rates and regulatory uncertainty.
The rental market looks to be particularly busy this year.
More than 91% of contractors who participated in the study indicated they plan to rent equipment during 2014. That’s up from just under 80% in 2013. Nearly a quarter of contractors said they would rely more heavily on rentals this year, due primarily to a lack of consistent work and the need for project-specific equipment they don’t own.
Considering these lingering uncertainties, it’s no surprise contractors may see renting as a safer, more cost-effective means of handling fluctuating workloads. To accommodate what’s predicted to be a strong rental market, more than half the distributors surveyed said they would be increasing the size of their rental fleet for this year.
Are you ready for better times?
Wells Fargo noted that, overall, construction equipment distributors were more optimistic than contractors themselves, but both groups are clearly feeling a lot more positive than in recent years. It all bodes well for your construction company, whether you’re working in construction or some other part of the industry. But only if you’re prepared.
You may be among the majority of contractors who are planning to rent more equipment this year. But if you’re contemplating purchasing any used equipment, ask your dealer about Protect My Iron® extended warranty coverage available through ADI Agency. Your dealer can link you with coverage for your machine’s powertrain, powertrain and hydraulics or the entire machine.
The Wells Fargo study noted contractors typically hold onto new equipment four or five years. If you have machinery that’s nearing the end of its original equipment warranty, Protect My Iron® coverage is a smart investment to guard against potential delay and expense in case of mechanical breakdown.
Marketing is crucial, too. You can’t take advantage of increasing work opportunities if potential customers don’t know you or can’t find you online. ADI’s marketing services can help ensure prospective customers are well aware of everything your company has to offer. Smart marketing spreads the word and establishes your construction firm as the best choice for work in your area. That way, you can grow along with the construction economy.
Now is the time to get a professional assessment of your website, to be sure it’s well-stocked with fresh and valuable content. You also want to be sure your SEO is fine-tuned, so people can easily find you and become more familiar with your firm and your capabilities.
Now is the time to get that blog you’ve been meaning to start off your marketing to-do list and online where it can attract more attention and help you grow. In fact, now is the time to review your entire marketing strategy, because optimism is a wonderful thing, but only if you can convert that excitement into increased sales.