Posts Tagged price of oil
As we near the end of the first three quarters of 2013, it appears that we may have some wind at our back. There has been some slight improvement in a couple of the key drivers of the automotive glass repair and replacement (AGRR) industry. The key drivers of the AGRR industry are weather, the economy and miles driven.
The Old Farmer’s Almanac has been published since 1792 and is “North America’s most popular reference guide and oldest continuously published periodical”. Forecasting the weather is a specialty of the Almanac and the publication touts an 80% success rate at correctly forecasting winter weather. The Almanac recently published the weather maps for 2013 – 2014. The Almanac is forecasting the following weather for regions they report for this coming winter:
- The Northeast a winter milder in the North and colder in the South with slightly above average snow in the region;
- In the Atlantic Corridor a colder winter with snowfall above normal;
- The Appalachians will see a colder winter with snowfall near normal;
- The Southeastern United States will see colder weather and above normal snowfall;
- In the Lower Lakes temperatures will be slightly milder with below normal snowfall;
- In the Ohio Valley area winter will be colder, along with below normal snowfalls;
- The Upper Mid-West will be a mixed bag with a warmer winter in the eastern part and below normal in the western part of the area. Snowfall will be above normal;
- The Heartland will be colder than normal this winter and snowfall near normal;
- The rest of the country is expected to be colder than normal with average to above average snowfall;
All-in-all a mixed bag with the weather and I hope that wherever your business is located you’re benefited by a colder and snowier winter.
The economy is also a bit of a mixed bag. Positive news came from new car sales which can be an important factor in an improving AGRR industry. J.D. Powers detailed year-on-year improvement in new-vehicle sales in the United States by reporting in their August 2013: Monthly Automotive Sales Forecast that “August new-vehicle sales reached the highest level in seven years.” The report went on to state, “New-vehicle retail sales in August 2013 are projected to come in at 1,270,400 units, 12 percent increase from 2012”. That’s great news for the AGRR industry. J.D. Powers is predicting growing new-vehicle sales for the remainder of 2013 and well into 2014. Really great news for the AGRR industry!
CNNMoney reported this past week in an article titled, “Jobless claims fall to 7-year low, but…” the rate of unemployment showed signs of dropping which is great news, but is tempered with the suggestion that it’s a result of people continuing to drop out of the work force. There are “11.3 million Americans who remain unemployed” the article reported with “three unemployed people for every job opening”. As with the weather, unemployment figures vary by region so its how your local economy is doing is what could affect how good your business will be in the next year.
The price of oil and how oil prices effect gasoline prices is another key part of the equation for the AGRR industry. As reported by the United States Energy Information Administration in the “Gasoline and Diesel Fuel Update”, prices year-on-year through September 9, 2013 on regular gasoline show that prices are down $ 0.26. Lower gasoline prices are great for both the consumers we rely on for business and for all of those company vehicles providing mobile service. Hopefully the price of gasoline will stay low.
You can look at reports from the U.S. Department of Transportation – Federal Highway Administration (FHA) as positive or negative depending where you reside. The FHA showed in its June 2013 Travel Monitoring and Traffic Volume Report that year-on-year miles driven were relatively unchanged with a slight decline of 0.1% from June 2012. The news that miles driven is not showing growth wasn’t great news for the AGRR industry that thrives on vehicles out driving on roads, but staying level was better news than a drop.
So how are these three key drivers affecting your business and do you think the wind is at your back? Regardless of whether the wind is at your back or not, I think there is a fourth key driver to your business and it is the most important one for finding success in your business. That key driver is you. So how are you going to take advantage of the marketplace you compete? What is it you’re doing to make your business stand out among all those with whom you compete?
I’ve written in previous blogs “The Times They Are (Always) A-Changing” and “The Times They Are (Always) A-Changing – Part II” about the opportunities in the marketplace for AGRR companies. I strongly believe that there are opportunities for independents in our industry, but you’ve got to surround yourself with the best people and make sure that they are all committed to the goals and aspirations that you have for your business. If you haven’t got that you’re going to be struggling.
What else are you doing to separate yourself from your competitors? Look for ways to be successful and be relevant in your market so that you stand out. There is a recipe for success in your market and you’ve got to figure out what it’s going to take to make sure you find and keep being successful. It starts with you as you’re the key driver of your business.
If the three key drivers are beginning to turn to your favor and with the possibility of the wind at our backs, what is it you’re going to do in the next year to see that you not only survive, but thrive in the AGRR industry? It’s really up to you.