Most suppliers, especially those who deal in automation, expect slight growth in 2020.
By Steve Guglielmo
MHEDA Suppliers continue to be optimistic going into 2020. As with the MHEDA Distributors, the optimism is muted in relation to previous years, though with many having experienced record years, even single digit growth would be a new high. Suppliers that deal in the automation field are especially bullish heading into the new year. Lithium-ion is another major growth market, according to projections. Many couched their optimism, however, on the U.S.-China trade war sorting itself out, as tariffs continue to hurt the industry.
Shawn Lennes, Strategic Planning Manager of Toyota Material Handling, forecasts sales to be down both for 2019 and 2020. “Contraction will be driven by a general economic slowdown driven by a weaker global economy and lower freight volumes,” says Lennes. He’s concerned about the slowdown of freight, trailers and trucks and what that means for next year’s economy. He expects that contraction to affect the entire industry. He adds, “Continued threads of trade tariffs will stifle growth.” He notes that Toyota will continue to invest in new products and more automation.
Autoquip Corporation Director of Sales and Marketing Louis Coleman projects a 7% increase in bookings for 2020. He says, “Distribution, transportation and aerospace are all going to continue to be every strong into next year. Actually, all sectors are either up or on par with last year, other than energy manufacturing.” Autoquip intends to add positions in inside sales/engineering and manufacturing. He also notes that geopolitical trends will have the greatest potential impact next year.
“Based on the feedback we are receiving from our clients, sales will be up 2-3%,” says tdt One Partner Bill Ryan. Most, if not all, of this increase will be attributed to mergers and acquisitions. Ryan believes consolidations will continue both on the OEM side as well as with the numbers of their dealers/distributors. “The material handling industry in North America is about to undergo a shift in distribution practices – by the end of 2022 the landscape will be dominated by huge dealers and factory stores,” Ryan says. “This will not be good news for dealers and distributors who choose to remain as traditional small family-owned businesses.”
Pacline Overhead Conveyors President Karl Scholz projects 10% growth in 2020 driven by reshoring and increased U.S. exports to China. The company will be leasing space in “Central USA” next year. Scholz cautions that a failure to come to a U.S.-China trade deal could negatively impact this projection. He finds recruitment and reinvestment to be the Material Handling Business Trend most impacting Pacline.
WireCrafters will see a 4% growth in 2020, according to Director of Sales and Marketing Milt Tandy. The main engine of that growth will be WireCrafters’ innovation of new products. Tandy noticed a growing trend of customers using wire partitions for safety and security that he expects to continue into 2020. The company will be releasing new products in the first and second quarters of the year. “We invested heavily in technology this year in our expansion and new machinery.”
As more dealers come on board, Noblelift North America could see sales increase by 15% in 2020, according to Managing Director of North America Loren G. Swakow. He sees lithium products continuing to grow. Noblelift North America will add new products in the 1st and 3rd quarters of the year. Swakow says that they will be existing products with lithium capabilities.
Ridg-U-Rak, Inc. National Sales & Marketing Manager Dave Olson forecasts level growth in 2020. “Macroeconomic data and business capex cautions a slowing first half,” Olson says. The company saw a continued shift of large corporations buying manufacturer direct or with systems integrators in 2019, something Olson expects to continue into the new year. After a slowing first half, Olson expects a reversal in the second half of the year. He adds, “The skilled labor shortage, specifically welders, is a major issue for manufacturers.”
Chris Jashinsky, Sales & Marketing Manager of Handle It Inc., forecasts a 7-10% growth in 2020 driven by the company’s marketing investment and gaining market share. He expects more large projects in 2020 and will add staff to accommodate the expected growth. He forecasts a steady industry with growth potential.
An increased focus on marketing and grass roots dealer distributor initiatives will lead Borroughs Corporation to a 4-8% growth in 2020, according to Executive Vice President Zac Sweetland. “We saw increased competition on the slowing number of larger shelving applications,” says Sweetland. The company plans to release new products in the 2nd and 3rd quarter of the year. “We are going to be introducing traditionally commercial based products and services to the masses, making them available and affordable to all,” he says.
Flux Power Director of Business Development Justin Forbes forecasts a doubling of sales, 100% growth, in 2020. He notes the continued adoption of lithium-battery technology as a trend that will benefit Flux Power. “End users with large fleets of MHE have moved past the question of, ‘Should I use lithium-ion batteries,’ to ‘Who should I select as my supplier of lithium ion batteries,’” Forbes says. “The technology has become more widespread and adoption continues to accelerate.” Flux Power moved into a new building in 2019 that is 3x the size of the previous facility.
Starrco President Bryan Carey forecasts 15-20% growth in 2020, based on the company’s presence in new markets. He saw a trend toward larger projects last year, which he expects to continue into 2020. Starrco has plans to release new products in 2020, which Carey says will be universally applicable and provide higher R value.
Morse Mfg Co, Inc. President Nathan Andrews foresees 5% growth ahead in 2020. Improved lead times will be the driving force behind that growth. Morse plans to add staff in manufacturing production next year. In 2019, the company moved into a new building. Andrews sees a strong material handling industry in 2020, especially if a trade deal with China is reached. Staffing and process improvements represent the company’s most important investments in 2020.
Tri Lite Inc. will see its sales decrease 5-10% according to President Bob Herling. He sees fewer cross dock warehouses being built and also is seeing the impact of tariffs as two motivating factors for that projection. Tri Lite plans to add a product development engineer in 2020 and also has plans to release new products in the 1st and 3rd quarter that will “increase reliability and safety in warehouses,” according to Herling.
Stellana Director of Global Sales and Marketing Michael Scoon forecasts 2.5% organic growth next year. He notes that while OEM business was weak in 2019, targeting markets outside of Stellana’s traditional markets will yield positive results in 2020. Like others, Scoon sees a weak 1st and 2nd quarter followed by a rebounding economy in the second half of the year. He says, “While we do not expect to increase our number of employees, we need to make sue we keep our current staff and grow their capabilities.”
Daifuku Wynright will see level sales in 2020, says VP of Integrator Sales Gordon Hellberg. “On the conveyor supply side for 2019, integrator sales were down,” says Hellberg. “I expect the trend for conveyor sales to integrators to be similar in 2020.” The company plans to add staff in applications engineering and will also a debut a cross belt sorter in the 1st quarter of the year. He sees this as an ideal product for e-commerce customers. He expects the trend toward automation solutions to continue to be strong.
Aaron Conway, President of Mezzanine Safeti-Gates, Inc., expects sales to be level to slightly up in 2020. “Safety equipment is always needed where employees work on elevated platforms or in loading docks,” says Conway. “We also will be rolling out some new safety gate models and technology options.” He adds, “In the coming year, robots and other automated machines and processes will continue to be used in industrial facilities. It’s important that we continue to ensure all applications and processes are safe for employees that may be interacting with or working on close proximity to the co-bots and machines.” The company will be debuting new safety gate models and options in the first half of the year.
Western Pacific Storage Solutions President/CEO Tom Rogers forecasts 15% growth in 2020 on the back of continued growth in e-commerce and two new products. The company will add engineers and project managers focused on larger systems. The new products will debut in the first quarter of the year and are “ideal for large distribution center applications,” according to Rogers. As many have noted, he sees a very strong trend toward automation continuing to be prevalent in the new year.