Reps Forecast Continued Sales Decline, Rebound Ahead

Released today, the MAFSI Business Barometer showed sales continued to decline for the 12th consecutive quarter in Q2/24. But in his executive summary, Michael R. Posternak, CEO of PBAC and Associates, says a recovery could start to appear in Q4/24 or Q1/25.

Overall, sales for Q2/24 declined into negative territory at -1.0% and came up short of the forecast for slim growth of +.01%. In comparison, sales for Q2/23 showed a gain of +4.1%.

Taking a closer look at categories, compared with Q2/23, sales in Q2/24 for equipment recorded a change of -1.0%, supply 2.4%, tabletop -2.1% and furniture -3.8%.

“Whereas the industry consensus is for a second half rebound, MAFSI Reps are now forecasting further shrinkage for the third quarter at -1.6%,” Posternak says. “This is backed up by only 29% stating an increase in Quoting Activity versus 35% last quarter, and only 15% stating an increase in Consultant Activity versus 30% last quarter.” He points out that reps are almost always accurate in their forecasting.

All regions recorded shrinkage for the second quarter ranging from -0.5% Midwest, -0.8% Canada, -1.0% West, -1.1% South and 1.5% Northeast.

Posternak says, at best, the industry has entered a period of stagflation (lower sales/higher prices) and is hopefully bottoming out.

The next MAFSI survey will come out on Nov. 18.