ARMO - Show Time and the New Normal | Specialty Equipment Market Association (SEMA)

SEMA Member News - November/December 2009

Adjusting Expectations and Riding the Cycle

ARMO Chairman Jim Barber reminds all council members and guests to attend the council’s reception on Tuesday, November 3, and the ARMO open meeting on Wednesday morning, November 4, while at the SEMA Show in Las Vegas. Help celebrate company and individual accomplishments and make your voice heard.

I know that this statement is repeated every year, but it is hard to believe that it’s time for the SEMA Show. While SEMA reports that the Show is down slightly, the association also reports that booth registration and attendance levels mirror 2004 numbers. I remember 2004 as being a great year.

Speaking of years past, a growing consensus believes that our industry will not return to the levels we experienced during the 2006/2007 peak years (by some reports, industry business peaked in early 2008). This is being referred to as the “New Normal.” I first learned of this term during the SEMA State of the Association meeting held in conjunction with the annual SEMA Installation Banquet.

Since attending that meeting, I have been giving a lot of thought to that term and how it relates to my business and our industry as a whole. The term suggests that we readjust and plan our businesses to a New Normal when the recession ends and that we adjust our minds and businesses to lower expectations than during the peaks of several years ago. This means that we need to shelve our thoughts of returning to those days of fast-paced, double-digit growth. What does this mean for the members of ARMO? It means that we need to look at our individual businesses, adjust accordingly, and perhaps reconcile our minds to the fact that we may not see those record numbers again—or at least for a long time. On the surface, this sounds quite simple. However, I believe that execution is the key. For some, adjusting to this level will mean survival; for others, it may mean the difference between having a profit and not having a profit.

I believe that ARMO’s portion of the automotive aftermarket is young. Sure, we have member companies that have been around for more than 30 years. However, our explosive growth has come during the last 10 years. I also believe that ARMO member companies have experienced our first business cycle. If you subscribe to the theory that all businesses are cyclical, ARMO member companies have entered their first down cycle. The good news is that many members are reporting increased sales and inquiries, meaning that we may be at the bottom of the cycle or perhaps beginning to rise from the bottom. Others feel that what we are experiencing now is a false bubble and sales numbers will remain down through 2010. My opinion? We need to understand and accept that our industry has grown to the point where we have become cyclical, recognize this fact and adjust our business plans to ride the cycle.

Changing Gears

Barber also encourages all ARMO members to drop by the council booth while at the Show. The booth will be located in the North Hall adjacent to Hot Rod Alley in the Restoration section of the SEMA Show. Learn about ARMO while you take a break to rest your feet or meet with a new vendor, customer or supplier.

I encourage all of you attending the SEMA Show to visit the ARMO booth. It will always be staffed with a Select Committee member. Why do we take time to staff the booth? To make ourselves available to our members, to answer your questions, to hear your concerns and, most importantly, to hear your suggestions about how you want your council to grow through new programs or new directions. Please take the time to stop by and speak with us. Also, some may not realize that the ARMO booth is also for your use. Consider it an oasis from the Show floor where you may take a break to sit and relax or to schedule a sit-down meeting with a potential new vendor, customer or supplier.

Finally, please remember our Tuesday-night (November 3) reception during the Show. It is ARMO’s chance to shine, to recognize and reward individuals, companies and events of the past year. It is the one time a year when we get to relax and spend time with other members, talk with them and, yes, have a couple of cocktails and eat some good food. The reception committee, led by Alex Tainsh and Sandy Patterson, has done another excellent job this year of putting on a great reception.

We hold our open meeting on Wednesday morning after the reception, and I encourage all of you to attend. The individuals of the Select Committee will give updates on various task forces and projects they are working on as well as provide an open forum for any new business you may want to discuss or bring to the attention of the group.

Have a great SEMA Show, and please make your presence known at the booth, the ARMO reception and our open meeting.

I and the entire Select Committee look forward to seeing you in Las Vegas!