John Wolz

Just over 65% of survey respondents reported cost increases in 2005, while the FIN Cost Index remained flat at 3.8. Fastener companies had predicted a cost drop in 2006 to an index of 3.5. Costs were reported lowest in 2001, when the index dipped to 2.8 before soaring to 4.1 in 2004.
About 31% of fastener companies reported no cost increases in 2006, while 3.3% saw costs drop.
More than 72% of distributors reported cost hikes in 2006, including 17.2% who reported “strong” increases. Distributors were closely split on the cost atmosphere for 2007, with 48.3% predicting “modest” cost gains and 44.8% expecting costs to remain unchanged.
Only 55% of manufacturers reported cost increases in 2006, though the cost index declined to 3.6 the same level predicted the previous year. About 37% of manufacturers reported flat cost structures in 2006, while 7.4% claimed “modest” cost cuts.
Just over four in 10 manufacturers claim costs will rise this year, with 37% forecasting stable costs and about 15% foreseeing “modest” cost declines. Any cost increases are likely to be mild in 2007, with 47.5% of companies predicting a “modest” increase and 41% forecasting stable costs. No survey participants were bracing for “strong” increases in 2007.
The predicted overall cost index for 2007 is 3.4. About 8% of companies see cost cuts in the future. \ �2007 FastenerNews.com