The political and economic climate of the United States makes talking about the upcoming year a little more difficult than it has been in the past.
A crack down on immigration could have an adverse affect on PRIER. Economists say immigration grows the US economy by over 10% per year. Immigrants need somewhere to live, food to eat, clothes to wear. I understand protecting our borders, but being shortsighted will harm our economy.
New Housing is a staple for PRIER and for most plumbing manufacturers. Lately new home sales have been hampered by available inventory. I believe, among other things, builders remember all too well the real estate bubble of a few years back and are proceeding with caution (single family housing starts are up only 9% over the last 12 months)…I don’t blame them! As the available inventory of new homes continues to rise, that will be a positive to PRIER and our economy. Commercial construction typically cycles behind residential construction, so that should be a boon to PRIER’s significant commercial business as that construction grows. All businesses are having issues finding qualified labor. Construction companies employ 1.5 million less workers than they did in 2007, and with unemployment rates for the industry are historically low, they are scrambling. Of course that is part of the reason why single family housing may be struggling. In our business, we are investing more than ever in training and developing our people, along with more and more automation allowing our worker productivity to improve.
Copper pricing, after being somewhat stable for the past four years has jumped, up 40% in the last year and that has a significant impact on our business. Copper is the primary metal in virtually everything we manufacture. If that market continues to rise, that will result in higher costs for PRIER and eventually our customers.
For PRIER in particular, we are going to continue to focus on the items that our customers find important. Beside the safety of our Associates, product quality is the most important aspect of what we do every day. Our Associates take great pride in giving our customers the best products available. They strive for perfection each day. We want to be our customer’s “best vendor”, and our customers have told us that we need to help them optimize the supply chain, so we’ve made significant investments in methods to accomplish this goal. Fair pricing has always been a hallmark of PRIER. Our customers report that their Gross Margin Return on Investment (GMROI) for PRIER is in the upper tier of ALL of their vendors - high praise indeed. At PRIER we’ll continue to do things to help become our customer’s “best vendor” today and long down the road.