Is There Still Time to Beat the Rush?

When is a good time to invest in new machine tools and other capital equipment? One school of thought advises shops NOT to wait until they are sure that business is firmly on an upturn, but rather to order and install equipment when times are still slow. That way, they will be ready for growth and not in a position of playing catch-up. If this advice is sound, then the time to act is now, or so it seems from studying the results of our latest “30-second survey.”

Every two months, MMS asks a random sample of its readers three simple questions: How are you feeling about the economy? What about your own business? Will you buy equipment in the next 12 months? We’ve been conducting this survey, which is designed to be completed in 30 seconds or less, since May 2009.

The latest survey (January 2011) shows that optimistic responses to the first two questions are the highest ever. More importantly, more than 60 percent of the survey takers say they are “very likely” (25 percent) or “somewhat likely” (36 percent) to invest in capital equipment in the next 12 months. These figures are the highest for these response categories as well.

This is certainly good news for suppliers of machine tools and other manufacturing equipment. But if a backlog of orders develops, would-be buyers may be asked to wait, just at a time when waiting is not what they can afford to do.