Economist Alan Beaulieu, the featured speaker at our recent Manufacturers Seminar and an advisor to the National Association of Wholesaler-Distributors, forecasts a mild recession in 2014, and he recommends that distributors plan for short-term growth in early 2013 while preparing for a slight downturn leading into 2014.
“The consumer is going to be the key to keeping the US economy in a recovery mode in 2013,” Beaulieu wrote in the October issue of the NAW Advisor. “The business-to-business activity will pick up in the first half of the year, but in and of itself, the activity will not be enough to keep the whole economy on a positive track. … The recession will be mild, and mild means manageable.”
With President Obama’s recent reelection, it is likely that new taxes and regulation related to the Affordable Care Act will come into effect in 2013. If the FICA tax rate rollback expires at the end of this year, consumers will face increased taxes in 2013, which will likely cause consumer sales to decline in the second half of the year and will contribute to the 2014 recession.
Based on these projections, Beaulieu suggests wholesale traders of durable goods should remain aggressive in sales efforts. Winning accounts from competitors, while difficult, will pay dividends when the economy recovers in 2015. Within the NAW Advisor, Beaulieu also offers practical suggestions for distributors in other sectors, including nondurable goods, furniture and home furnishings, and grocery and related products.