Industry Sales Up Again
The retail environments industry continues its multiyear rebound By Klein Merriman
Spring has finally arrived, bringing with it positive news from A.R.E.’s just-completed Spring Revenue Survey. The retail environments
industry clearly is continuing its multi-year
rebound from the depths of the 2008-2009
According to A.R.E.’s survey of 80-plus
member fixture, visual, retail design firm,
and P-O-P supplier companies, the industry grew 10 percent in 2012. These same
companies predict an identical 10 percent
increase in sales in 2013. This is good news.
If these projections prove accurate, the
mythical “typical company” in the retail
environments industry will have enjoyed
a 12 percent compound annual growth rate
of sales since the recovery began in 2010.
Total industry sales—as extrapolated
from the performance of survey respondents—returned to the 2007 sales level
A NOTE ON VARIANCE
For the first time since 2008, the variance
in the results reported by individual A.R.E.
member companies has decreased substantially. The variance in sales reported by the
sample of 80-plus members in 2009 was
over three times as great as the variance in
expectations for 2013—5.6 percent variance in 2009, compared to 1. 8 percent in
2013. This is a welcome change.
These highly variable results in prior
years were driven by the high level of customer concentration typical of most A.R.E.
members. If a company’s two or three dominant customers were either doing well or
doing poorly, the company’s performance
could be significantly different from the
average industry provider.
But as the recovery has matured, we’ve
finally seen this variability decrease. This
is in part due to the closing of a least 40
member companies over the last four years.
Also, because there are also fewer retailers in serious trouble, their designer and
– 1.0 –0.8%
2000 1999 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
According to A.R.E.’s survey of 80-plus member fixture, visual, retail design firm, and P-O-P
supplier companies, the industry grew 10 percent in 2012. These same companies predict
an identical 10 percent increase in sales in 2013.
“The choppy seas
that I’ve talked
about for several
years are finally
manufacturer partners are experiencing at
least some growth. The “choppy seas” that
I’ve talked about for several years are finally
starting to smooth out.
A RETURN TO NORTH AMERICA?
A number of stories in the general business
media recently have talked about manufacturers returning to North America as the
competitive advantages of sourcing in Asia
have declined. According to our survey,
this trend is not yet having a significant
impact in our industry. Half of respondents
reported that they expect to import about
the same amount in 2013 as they have in
recent years. Thirty-six percent expect to
import more. Only 14 percent reported that
they expect to import less in 2013.
So the headlines are: a strong sales
increase in 2012, another strong performance expected in 2013, and few changes
evident in importing trends in North