2001 Sets Negative Records; Indicators Show Worst May Be Over

John Wolz

�The 2001 results are record breaking, but it�s not the type of record you like to see broken,� Tony Casilio of AWP Research summarized the findings of the End of 2001 Fastener Industry News Survey of the Fastener Industry.
�The recession has hit the fastener industry hard � the FIN Index is at 5.6, the lowest in the eight-year history of the index.� It was at 6.8 a year ago and 7.1 at the end of 1999.

The sales index dropped from 3.6 for 2000 to 2.6 for 2001. The profit index slid from 3.3 for the previous year to 2.6 for 2001.
Sixty percent had reported 2000 sales increases, and only about a quarter had sales increases for 2001.
A year ago the industry was more optimistic about prospects than 2001 turned out to be.

Prices also presented a problem, as nearly 30% reported prices for their fasteners dropped during 2001. Only about 12% report price drops in 2000.
� A total of 45% reported layoffs. �Staff cuts were commonly mentioned when respondents describe actions taken to cut costs,� Casilio found.
�The worst appears over for workers, with a majority saying they don�t plan any cuts in 2002,� Casilio observed.
� Despite the staff cuts, pay increases were common, with two-thirds increasing pay at a median of 4%, Casilio found.
� The drop in confidence a year ago proved prophetic. �Although respondents were not forecasting a banner year in the last survey, profit and sales performance is lower than they were expecting, down to an average of 2.6.
Confidence in both the North American and global economies dropped. The North American index was at 2.8, compared with 3.0 a year ago, and confidence in the global economy fell from 2.9 at the end of 2000 to 2.6 at the start of this year.
� However, man-ufacturers report inventory levels are down to the lowest point in the six years the Finished Goods Index has monitored inventory. That indicates any increase in fastener demand will require new production rather than just inventory reduction. \ �2002 FastenerNews.com