{"id":60254,"date":"2024-05-09T13:08:42","date_gmt":"2024-05-09T20:08:42","guid":{"rendered":"http:\/\/www.enxmag.com\/twii\/?p=60254"},"modified":"2024-05-09T13:08:45","modified_gmt":"2024-05-09T20:08:45","slug":"entering-the-crossroads-is-the-rising-tide-lifting-your-boat","status":"publish","type":"post","link":"https:\/\/www.enxmag.com\/twii\/the-week-in-imaging-twii\/editors-blog\/2024\/05\/entering-the-crossroads-is-the-rising-tide-lifting-your-boat\/","title":{"rendered":"Entering the Crossroads: Is the Rising Tide Lifting Your Boat?"},"content":{"rendered":"\n
\"\"<\/figure><\/div>\n\n\n\n

We\u2019re not even halfway through calendar 2024, yet the year is already revealing as much about the future of the industry as it is the present. As a business owner, you should be fully attuned to what it is saying.<\/p>\n\n\n\n

You can drop the word \u201cnew\u201d from the term \u201cnew normal.\u201d What you see is what you\u2019re going to get for the foreseeable future. We abide by the saying \u201cA rising tide will life all boats,\u201d but regardless of your aphorism of choice, the fact of the matter is the tide is quite high. If your dingy is plodding through mud, so to speak, it could be an indication that your business is missing out on the best of times.<\/p>\n\n\n\n

The talk of recession has dimmed to a whisper. Why? Despite inflation\u2019s stubborn insistence and the Federal Reserve\u2019s decision to hold off on an interest rate cut, corporate profits are quite lucrative. Earlier this week, the Wall Street Journal<\/em> published an article that chronicles billowing profitability. It noted \u201cCorporate profits are important because they show the U.S. economic engine continues to purr. While some other economic indicators, such as consumer-sentiment readings, have been downbeat, and inflation <\/a>has ticked up, a strong U.S. profit performance typically points toward continued expansion.\u201d<\/p>\n\n\n\n

High Times<\/strong><\/p>\n\n\n\n

Granted, the S&P 500 and the Elite Dealers list are not one and the same. But I\u2019m not here to play economist. I\u2019m here to quote Jack Nicholson. \u201cWhat if this is as good as it gets?\u201d he opined in a movie with the same title. If \u201cthis,\u201d the volume of business, doesn\u2019t get any better\u2014and there\u2019s actually room for it to get worse\u2014will you be OK with that? Or are you still banking on better times?<\/p>\n\n\n\n

Anecdotally, the news is good. A vast majority of the dealers we talk to from month to month have been deluged with orders. Some are in dire need of more employees to shoulder the load. Some are working on adding warehouse capacity. And while it\u2019s not human nature to confess, \u201cBusiness is down sharply\u2014we\u2019re in a world of trouble\u201d there are usually minor clues: voice inflections, subtle sighs and hopeful language that indicate times are not as good as they could or should be. For the most part, we\u2019re not sensing disappointment cloaked by optimism.<\/p>\n\n\n\n

But if the economic engine continues to purr, as the WSJ<\/em> suggests, and the motor isn\u2019t revving for you, it may be in indication that it\u2019s time to sell. You want to look out for the best interests of your clients and employees. If a master plan is not generating positive results during prosperous periods, it\u2019s certainly not going to flourish during the next economic downturn.<\/p>\n\n\n\n

The M&A market in our industry has tracked downward during the past 18-24 months. The appetite for acquisition is voracious among the large national dealers, major regionals and even the smaller players. While companies aren\u2019t realizing the EBITDA multiples from three years ago, there\u2019s still an opportunity for structurally-sound dealers to reap a strong return on\u2014what is for some\u2014a lifetime investment. It smacks of a seller\u2019s market, at least in this estimation.<\/p>\n\n\n\n

The \u201cold norm\u201d isn\u2019t returning anytime soon, if at all. If that\u2019s bad news, plan accordingly.<\/p>\n","protected":false},"excerpt":{"rendered":"

We\u2019re not even halfway through calendar 2024, yet the year is already revealing as much about the future of the industry as it is the present. As a business owner, you should be fully attuned to what it is saying. You can drop the word \u201cnew\u201d from the term \u201cnew normal.\u201d What you see is what you\u2019re going to get for the foreseeable future. We abide by the saying \u201cA rising tide will life all boats,\u201d but regardless of your aphorism of choice, the fact of the matter is the tide is quite high. If your dingy is plodding through mud, so to speak, it could be an indication that your business is missing out on the best of times. The talk of recession has dimmed to a whisper. Why? Despite inflation\u2019s stubborn insistence and the Federal Reserve\u2019s decision to hold off on an interest rate cut, corporate profits are quite lucrative. Earlier this week, the Wall Street Journal published an article that chronicles billowing profitability. It noted \u201cCorporate profits are important because they show the U.S. economic engine continues to purr. While some other economic indicators, such as consumer-sentiment readings, have been downbeat, and inflation has ticked up, a strong U.S. profit performance typically points toward continued expansion.\u201d High Times Granted, the S&P 500 and the Elite Dealers list are not one and the same. But I\u2019m not here to play economist. I\u2019m here to quote Jack Nicholson. \u201cWhat if this is as good as it gets?\u201d he opined in a movie with the same title. If \u201cthis,\u201d the volume of business, doesn\u2019t get any better\u2014and there\u2019s actually room for it to get worse\u2014will you be OK with that? Or are you still banking on better times? Anecdotally, the news is good. A vast majority of the dealers we talk to from month to month have been deluged with orders. Some are in dire need of more employees to shoulder the load. Some are working on adding warehouse capacity. And while it\u2019s not human nature to confess, \u201cBusiness is down sharply\u2014we\u2019re in a world of trouble\u201d there are usually minor clues: voice inflections, subtle sighs and hopeful language that indicate times are not as good as they could or should be. For the most part, we\u2019re not sensing disappointment cloaked by optimism. But if the economic engine continues to purr, as the WSJ suggests, and the motor isn\u2019t revving for you, it may be in indication that it\u2019s time to sell. You want to look out for the best interests of your clients and employees. If a master plan is not generating positive results during prosperous periods, it\u2019s certainly not going to flourish during the next economic downturn. The M&A market in our industry has tracked downward during the past 18-24 months. The appetite for acquisition is voracious among the large national dealers, major regionals and even the smaller players. While companies aren\u2019t realizing the EBITDA multiples from three years ago, there\u2019s still an opportunity for structurally-sound dealers to reap a strong return on\u2014what is for some\u2014a lifetime investment. It smacks of a seller\u2019s market, at least in this estimation. The \u201cold norm\u201d isn\u2019t returning anytime soon, if at all. If that\u2019s bad news, plan accordingly.<\/p>\n","protected":false},"author":166,"featured_media":60255,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[80,1650,82,1638],"tags":[4451],"_links":{"self":[{"href":"https:\/\/www.enxmag.com\/twii\/wp-json\/wp\/v2\/posts\/60254"}],"collection":[{"href":"https:\/\/www.enxmag.com\/twii\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.enxmag.com\/twii\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.enxmag.com\/twii\/wp-json\/wp\/v2\/users\/166"}],"replies":[{"embeddable":true,"href":"https:\/\/www.enxmag.com\/twii\/wp-json\/wp\/v2\/comments?post=60254"}],"version-history":[{"count":1,"href":"https:\/\/www.enxmag.com\/twii\/wp-json\/wp\/v2\/posts\/60254\/revisions"}],"predecessor-version":[{"id":60256,"href":"https:\/\/www.enxmag.com\/twii\/wp-json\/wp\/v2\/posts\/60254\/revisions\/60256"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.enxmag.com\/twii\/wp-json\/wp\/v2\/media\/60255"}],"wp:attachment":[{"href":"https:\/\/www.enxmag.com\/twii\/wp-json\/wp\/v2\/media?parent=60254"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.enxmag.com\/twii\/wp-json\/wp\/v2\/categories?post=60254"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.enxmag.com\/twii\/wp-json\/wp\/v2\/tags?post=60254"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}