2017 Industry Forecasts (Part I)
Expert prognostication beyond the inauguration
Following is the first of a two-part series:
Outdoor Power Equipment (OPE) recently invited several of the OPE industry’s most well-respected leaders to share their thoughts about the state of the industry heading into 2017. Specifically, we asked them the following questions:
- What is new with your company and/or any OPE industry associations that you represent?
- How will the election of Republican Donald Trump as president, along with Republicans maintaining control of Congress in both the House and Senate, impact the OPE industry?
- What was the OPE industry’s biggest story in 2016, and what do you predict it will be in 2017?
- What will be the OPE industry’s hottest trends in 2017?
- What is your overall outlook for the OPE industry in 2017?
OPE received the following written responses, in order, Nov. 23-Dec. 6, 2016:
STAN CRADER
PRESIDENT
CRADER DISTRIBUTING CO.
(MARBLE HILL, MO.) &
BLUE MOUNTAIN EQUIPMENT
(McKINNEY, TEXAS)
1) What is new with your company and/or any OPE industry associations that you represent?
Stan Crader (SC): The biggest news at Crader/Blue Mountain is the introduction by Stihl of two additional series of lithium-ion products to Stihl’s lithium-ion system. The new products, combined with Stihl’s existing line of lithium-ion products, will put Stihl dealers in position to offer a cordless outdoor power tool to fit anyone’s need or budget.
2) How will the election of Republican Donald Trump as president, along with Republicans maintaining control of Congress in both the House and Senate, impact the OPE industry?
SC: The beneficial effects of a business-friendly government are already being manifested by the confidence exhibited with the immediate and unprecedented post-election gains in the stock market. The lurking potential for unforeseen and costly regulations which can be devastating to small business, the mainstay of the OPE industry, have resulted in a reluctance to make investments that weren’t deemed absolutely necessary. With that barrier removed, all business, and particularly small business, will proceed with the entrepreneurial spirit that made America great. Combine that with a government that is pro-America, which will result in a marked increase in consumer confidence, and OPE dealers will experience retail sales increases across the board. Based on the post-election interest in new display systems we’re offering dealers, I sense the new-felt optimism already gaining momentum.
3) What was the OPE industry’s biggest story in 2016, and what do you predict it will be in 2017?
SC: Fred Whyte’s retirement after working his entire career of more than 44 years with Stihl, and 23 of them as president, is easily the biggest event for OPE in 2016. Fred’s single-company career cloaked with his long tenure as president, speaks volumes for both Fred and Stihl. His retirement, and the announcement of his replacement, Bjoern Fischer, highly qualified and having hit the ground running, and spearheading the introduction of Stihl’s two new series of lithium-ion products, is easily the biggest news of 2016.
4) What will be the OPE industry’s hottest trends in 2017?
SC: The hottest trend in 2017 for OPE will be the rapid adoption of cordless products by existing customers and the new entrants to the OPE customer base. OPE dealers will experience a high velocity of customers switching from gasoline to battery and a new cadre of customers who, with quality and powerful battery products now an option, will choose a battery product for their very first OPE purchase.
5) What is your overall outlook for the OPE industry in 2017?
SC: I’m frequently labeled a graveyard whistler and always predict positive results, but with the announcement of Stihl’s new lithium-ion products, and the consumer confidence instilled by a pro-American government, I’m reasonably confident that the entire OPE industry will be the beneficiary, resulting in significantly increased dealer floor traffic. Of course, the weather is the great arbiter.
JOHN D. HEDGES
DIRECTOR OF SALES AND MARKETING
CENTRAL POWER DISTRIBUTORS, INC. (CPD)
(ANOKA, MINN.)
1) What is new with your company and/or any OPE industry associations that you represent?
John D. Hedges (JDH): We have become a one-stop shop for many outstanding product lines most dealers carry. Our ability to get it to the dealer the next day, in most of our territory, helps them control their inventory costs.
Recently, we became the source for Strikemaster, Jiffy and Eskimo ice augers. While this doesn’t sound that appealing in Florida, it is certainly something the dealers in the northern states have hoped for.
CPD is actively searching for what the dealer wants, expects, and needs through our dealer advocacy interviews and our newsletter polls. We believe if we can become more important to our customers business, we will both prosper. With market opportunities and new customer trends changing all the time, who else can help us understand those better than our customers?
2) How will the election of Republican Donald Trump as president, along with Republicans maintaining control of Congress in both the House and Senate, impact the OPE industry?
JDH: President Trump will be good for our industry. His administration may put less emphasis on ethanol production. Our Kohler EFI engines will continue to grow with or without ethanol around. Dealers benefit from ethanol in gas since it creates carb issues, which equal service work.
Engine manufacturers are constantly keeping up with strict EPA changes, and I wonder how many of those regulations will ease up or go away. It’s hard to imagine that EPA restrictions will get tougher under his administration. In my past OPE opinions, I have commended the engine manufacturers for their ability to keep costs down and yet meet the guidelines. I am once again doing that. Thank you for your hard work to keep our prices in check.
Our fuel prices have been around $2.00 a gallon since President-elect Trump won. Is that because he is pushing for more use of our own oil? Is he is a threat to the Saudis, and that’s keeping oil prices lower? It’s very early even in the guessing game, but something to consider. With lower fuel prices, our landscapers will benefit.
Obamacare will be attacked from all angles, but in the end, there are parts that the Republicans should consider keeping. Until they have an alternative and then get it to pass, Obamacare is here to stay. Healthcare costs are through the roof, and whatever is done, that will not change. With such a big part of a company’s profit picture, something has to be done to improve costs.
I thought the winner of the presidential election would come down to an outsider this year, and you can see that in my responses for OPE’s 2016 Industry Forecasts in January 2016 OPE! If you contribute to this annual industry survey enough times, you will be right at least once. I am excited for the next 4 to 8 years of a Trump Administration.
3) What was the OPE industry’s biggest story in 2016, and what do you predict it will be in 2017?
JDH: Ariens has sold Stens and JThomas to a company outside of our industry. It’s still early as of this writing, but it should be business as usual for Stens customers. The new owner is an electrical supply company, and they will benefit from the infrastructure that Stens offers. As a Stens distributor, we welcome the new owners into our industry and look forward to working with them.
The weather was incredible in most parts of the country with an early spring and late fall. Most dealers heard the cash registers ringing longer than normal. With a good winter, dealers that have suffered financially can get out of a jam and begin to stock up again.
2017 might bring changes to servicing for certain mass merchants. Servicing their customer products in the field is the number one issue for mass merchants selling power equipment. It’s possible that another short-lived solution will be created, then whither away again in 3-4 years. Until the manufacturers protect the dealers from diagnostic time losses and warranty losses, this will always be a problem. We (CPD) have suggested a solution with one mass merchant to have a checklist and develop a relationship with each dealer that provides service for that mass merchant. CPD hopes to have that finalized and in place by spring.
4) What will be the OPE industry’s hottest trends in 2017?
JDH: Manufacturers might be in the news a lot in 2017 with acquisitions and mergers. There are some amazing small OEMs left out there, and some might get purchased by their larger competition in 2017.
Other things that could be trending next year are Internet policies, distributor re-organizations, and dry conditions.
Internet sales reach new highs for outdoor power equipment.
Succession plans are not effective, so more dealers will go away. This is an opportunity for those left around the area.
Mobile servicing dealers should be on the rise. The way a customer shops has changed, and why shouldn’t the way he gets service?
5) What is your overall outlook for the OPE industry in 2017?
JDH: More consumer confidence from the Trump victory might have an effect on new equipment sales. Profits will be hurt because parts are more profitable than equipment.
There have always been discussions about the number of servicing dealers. In 2017 and beyond, the base will shrink, leaving a few areas for opportunity. Mentioned above is an increase in the number of mobile dealers. We will encourage dealers to be more mobile to work with the typical homeowner that has 2 incomes, 2 kids, 1 dog, and no time! Another opportunity from dealers going out of business is more customers, because there is nowhere else to go. The consumer will be burdened with more miles to drop off and pick up. Find ways to attract this market, and you will do well. With all that said, I like what I see for 2017.
KRIS KISER
PRESIDENT AND CEO
OUTDOOR POWER EQUIPMENT INSTITUTE (OPEI)
(ALEXANDRIA, VA.)
1) What is new with your company and/or any OPE industry associations that you represent?
Kris Kiser (KK): First, the 2016 GIE+EXPO (Green Industry & Equipment Expo), of which OPEI is the managing partner, broke new records in attendance, number of exhibitors and floor space. More than 22,600 people from around the world represented a 12-percent increase in registration over last year. Thirty-three percent of dealer and 44 percent of lawn and landscape attendees were first timers. The UTV presence continues to expand with GIE+EXPO’s inaugural UTV University, a partnership with Powersports Business. Its success means UTVs will continue to have a strong presence in future shows.
OPEI’s environmental education program, TurfMutt, also continues to grow and expand. To date, the program has brought its message of taking care of and valuing managed green space to more than 62 million kids, teachers and family members. TurfMutt talks to consumers and homeowners through a role with the Lucky Dog TV show and is continuing its partnership with global children’s publishing, education and media company, Scholastic. In 2017, the first-ever, national TurfMutt Teacher award will be awarded at the National Science Teachers Association annual convention in May. The OPEI board also greenlighted a number of videos, showing lawn and landscape conversions — or shall I say, re-establishing green space and living landscapes — in California. California chose to eviscerate many of its living landscapes to save water and is now paying a heavy, environmental price, including millions of dead and dying trees, loss of habitat and dead play spaces for kids and pets. The videos, showing TurfMutt putting green space back in, will be seen through various streaming channels, including Lucky Dog promotions and website, and streamed on Facebook and YouTube.
2) How will the election of Republican Donald Trump as president, along with Republicans maintaining control of Congress in both the House and Senate, impact the OPE industry?
KK: It’s too early to tell the impact. But in all likelihood, there will be a moratorium on future environmental regulations. The EPA could go into a holding pattern with no expansion or additional environmental regulation. But nothing is stopping California from moving forward in environmental regulation. In fact, California is moving ahead with substantial revisions to its evaporative emissions rules.
3) What was the OPE industry’s biggest story in 2016, and what do you predict it will be in 2017?
KK: Without question, the biggest story last year was the California drought and California’s potential leadership role in how other parts of the country respond to water scarcity. California leads the way on fashion, media, environmental movements, and now in drought response. But we don’t want California’s water mistakes to bleed into other parts of the country, like New England and the South, which also is dealing with drought. California demonized the managed landscape, labeling it a water-waster, and spent hundreds of millions of dollars of taxpayer money encouraging people to rip out their grass and put in mulch, rocks, cacti and plastic grass to the detriment of habitat, play space and the environment overall. Its one-size-fits-all approach also left millions of dead and dying trees, many of which used to be watered as part of the managed landscape. Yet California is now being viewed by other states as a potential model on how to deal with water scarcity? Not a good idea. Installing artificial turf (plastic grass), in particular, was the worst idea for both the environment and for saving water, and it’s too hot for kids or pets to play on. Recently, the Los Angeles Department of Water and Power was caught for irrigating its newly installed plastic grass to clean it. No water savings there. The introduction of plastic products in response to drought isn’t an environmentally responsible move and does nothing to support human, pet or wildlife health. Having the right living landscape for your climate zone is the answer.
For 2017, the big stories will include California developing new rules aimed at reducing outdoor power equipment emissions up to 80 percent. We also expect to see a run at the Renewable Fuels Standard (RFS) in the Congress. With a new administration and new Congress, an RFS repeal or revision likely will be sought. But there’s still much uncertainty in the political climate. We also expect to see more questions raised around the value of the living landscape, driven by drought and exacerbated by California’s actions, which, again, have proven disastrous.
OPEI will continue to work with our partners in the lawn and landscape industry, addressing drought response and a host of other issues, such as the California emissions rules.
4) What will be the OPE industry’s hottest trends in 2017?
KK: OPEI’s statistics reports suggest strong trends in battery and electric products, and an ongoing expansion of UTV product offerings.
5) What is your overall outlook for the OPE industry in 2017?
KK: The OPE industry will continue to grow. But we’re also gearing up for many regulatory changes that will impact the industry. We expect the California Air Resources Board’s (CARB) evaporative emissions rule amendments will be finalized in 2017, effective in 2020. Manufacturers will be significantly impacted by certification and compliance strategy revisions. The revisions look to further bifurcate U.S. EPA and California regulations for many types of outdoor power equipment. OPEI will continue to be engaged with California to finalize the evaporative amendments and monitor the development of future exhaust and evaporative rules in 2017.
SCOTT CONNER
SENIOR VICE PRESIDENT
HONDA POWER EQUIPMENT
(ALPHARETTA, GA.)
1) What is new with your company and/or any OPE industry associations that you represent?
Scott Conner (SC): Honda Power Equipment introduced two new generators this fall, the EG2800i for residential use and EB2800i for industrial use; and a new commercial lawn mower, the HRC216K3HDA. Both the generators and the new commercial mower expand on our already outstanding lineup of products.
2) How will the election of Republican Donald Trump as president, along with Republicans maintaining control of Congress in both the House and Senate, impact the OPE industry?
SC: We don’t have enough details to make a prediction of the impact on the OPE industry just yet, but we look forward to working with both the new administration and Congress to accomplish everyone’s goal: a healthy economy.
3) What was the OPE industry’s biggest story in 2016, and what do you predict it will be in 2017?
SC: The weather and the severity of it in different regions definitely had an impact on the industry. Whether it was late snowfall in parts of the country, or the extreme drought in the West and Southeast, weather was a major part of industry stories in 2016.
4) What will be the OPE industry’s hottest trends in 2017?
SC: The continued diversification of the power supply for OPE products will be a trend that we believe will grow in 2017. Whether it is electrification of products, further refinements in the internal combustion engine or other propulsion advancements, diversification of how outdoor power equipment products generate their power will make 2017 an exciting year in the industry. In addition, robotic mowers are beginning to make inroads into the U.S. market after being popular in Europe for many years.
5) What is your overall outlook for the OPE industry in 2017?
SC: Honda is generally optimistic about the OPE industry for 2017. 2016 was a solid year for the industry, even with the severe drought conditions in parts of the country, and we expect 2017 to continue the positive trends the industry has seen.
Indicators appear favorable to continue driving increases in housing starts and existing home sales, which should have a positive effect on power equipment sales as the year progresses.
RICK ZECKMEISTER
VICE PRESIDENT
ENGINE MARKETING
BRIGGS & STRATTON CORP.
(MILWAUKEE, WIS.)
1) What is new with your company and/or any OPE industry associations that you represent?
Rick Zeckmeister (RZ): We’ve had an exciting and busy year at Briggs & Stratton and are looking forward to more of the same in 2017.
On the commercial side of things, our focus on improved productivity for our customers takes several forms:
* We expanded the Vanguard EFI offerings to new engine platforms and new applications. Our EFI engines provide increased productivity, better fuel efficiency, more power and better starting.
* At the 2016 GIE+EXPO, Briggs & Stratton introduced the Vanguard Oil Guard system to our 810 and Big Block commercial engine series. The Oil Guard system allows our commercial landscape contractors to go 500 hours between oil changes – that’s 400 hours more than the current industry standard of 100-hour intervals.
* We’re proud to be a partner and fully integrated with SmartEquip, which allows rental stores to find whatever part they may need, order it, have it delivered through Power Distributors, get the part, and get back to work.
For residential, we’re continuing to make oil changes a thing of the past as we extended our Just Check & Add innovation with some of our other most popular innovations. In 2016, we paired our Quiet Power Technology engine with Just Check & Add, creating a quieter engine that never needs an oil change*. 2017 brings the Just Check & Add innovation to our Mow N’ Stow engine that can be stored upright without leaking gas or oil. Those are just a few examples of the consumer-driven innovations we’ve recently developed and are now combining to make it easier for consumers to start, use, maintain, and store their outdoor power equipment.
Finally, Briggs & Stratton will continue to build our You.Powered. brand positioning, which launched in 2016. We refreshed our brand to better reflect the emotional connection we have with the end user and the sense of achievement they feel when a job is done well. It also summarizes our philosophy as a company and how we collaborate and support our customers. You.Powered. is all about making sure that we’re doing all we can to help our consumers, employees and business partners achieve their goals, and we look forward to continuing to bring this positioning to life.
2) How will the election of Republican Donald Trump as president, along with Republicans maintaining control of Congress in both the House and Senate, impact the OPE industry?
RZ: Every election brings potential changes to the industry and our company. We are currently evaluating President-elect Trump’s policies and the introduction of the new administration to ensure the continued success of our company.
3) What was the OPE industry’s biggest story in 2016, and what do you predict it will be in 2017?
RZ: In 2016, we witnessed both residential and commercial users demanding products that help them get work done more efficiently. For Briggs & Stratton, we saw very positive responses to our innovations that address those needs. For example, our Vanguard EFI engines and our consumer EXi series engine that never requires an oil change*, were met with enthusiastic responses.
For 2017, we’ll see continued support of our dealer network. Dealers have always been the backbone of the industry, and at Briggs & Stratton, we’re providing additional tools and support for dealers to grow their businesses and help serve their customers better. For us, this focus on dealers is manifesting itself in many ways, not the least of which is through Power Distributors, our single Briggs & Stratton distributor. As the only national distributor of whole goods, engines, parts and accessories for Briggs & Stratton, Snapper and Simplicity, Power Distributors offers superior service and the ability to deliver next day to 99 percent of the country in order to meet the business needs of dealers and their customers.
4) What will be the OPE industry’s hottest trends in 2017?
RZ: We’ll see residential and commercial customers alike both looking for smarter, better solutions in their equipment and trading up to get them. In the past few years, many innovations have been introduced in response to what customers wanted. Now that these innovations are well established in the marketplace, we’ll see people trading up, even if their old equipment is still working. In the riding mower category, for instance, our research indicates that more than 1/4 of purchases were made by existing owners who were looking for something newer or better. Likewise, approximately 20 percent of recent walk-mower buyers sought new technology that made it easier to use and maintain their equipment.
As we as an industry continue to offer more meaningful innovations, the end user will continue to trade up.
5) What is your overall outlook for the OPE industry in 2017?
RZ: We believe there will be moderate growth in the outdoor power equipment category. While we’re always watching the housing market as a whole, we keep a close eye on starter-home inventory and new-home construction. Upticks in these two subsectors have the potential to make a big impact on our business and our industry overall. From what we’re seeing, the housing market is expecting moderate growth for 2017, with pent-up demand in these subsectors.
* Under normal use conditions. To see complete details, refer to your Operating Manual. Briggs & Stratton standard warranty terms and conditions apply. Just Check & Add does not extend the warranty period. See www.briggsandstratton.com/us/en/support/warranty for details.
JEFF DEWOSKY
VICE PRESIDENT AND GENERAL MANAGER
HUSQVARNA NORTH AMERICA
(CHARLOTTE, N.C.)
1) What is new with your company and/or any OPE industry associations that you represent?
Jeff Dewosky (JD): We have some exciting new product launches planned for 2017, especially for our commercial lawn, garden and tree care customers. We recently unveiled some upcoming additions to our Battery Series, including a professional-grade trimmer and two pole saws, and we’ll also be launching a new Fleet Services technology that will help landscaping companies more efficiently manage their operations.
2) How will the election of Republican Donald Trump as president, along with Republicans maintaining control of Congress in both the House and Senate, impact the OPE industry?
JD: It’s difficult to predict exactly how a new administration will affect our industry, and we’re going to keep a close eye on new legislation as it develops. We hope any regulations will benefit the small businesses that employ lawn, garden and tree care professionals throughout the country.
3) What was the OPE industry’s biggest story in 2016, and what do you predict it will be in 2017?
JD: Technology played a huge role in shaping the industry this past year. We saw some exciting advances in robotic mowing, and we were excited to contribute to that with the launch of three new Automower models. We’ve also seen more and more professionals adopt battery-powered equipment, and we expect this to be a dominant trend heading into 2017.
4) What will be the OPE industry’s hottest trends in 2017?
JD: Environmental and sustainability concerns may come to the forefront this year, especially as more communities pass ordinances restricting the use of certain gas-powered outdoor power equipment. That’s why we’re continuing to focus on providing efficient products that will ensure our customers can respect these mandates without sacrificing the durability and performance they need to get their jobs done quickly and professionally.
5) What is your overall outlook for the OPE industry in 2017?
JD: We’re optimistic about what the coming year has in store for our industry. There have been several exciting technology developments in 2016, and we expect this momentum to continue into 2017 as we move forward with launching new products that will help lawn, garden and tree care professionals work more efficiently.
HAROLD REDMAN
SENIOR VICE PRESIDENT & PRESIDENT
TURF & CONSUMER PRODUCTS
BRIGGS & STRATTON CORP.
(MILWAUKEE, WIS.)
1) What is new with your company and/or any OPE industry associations that you represent?
Harold Redman (HR): We introduced a number of new products designed to meet the needs of the user.
Commercially, we continue to offer product innovations designed to make professional landscapers more productive. We introduced the Vanguard Oil Guard System on models across the Ferris lineup. A Ferris exclusive for model year 2017, Oil Guard extends the oil change interval 5x, from 100 to 500 hours, which reduces downtime and keeps landscapers cutting. We also expanded our line of commercial stand-on products, introducing the SRS-Z1 which touts 36- and 48-inch mowing decks. And our Billy Goat product line of turf care products continues to grow as we introduced the hydrostatic sod cutter.
On the residential side, we announced new homeowner zero-turns under our Simplicity and Snapper brands, the Courier and 360Z, respectively, featuring commercial-inspired features and the industry’s first integrated cargo bed for added utility. Our new Snapper XD handheld line of 82-volt lithium-ion products offers homeowners a multi-tool system that uses a common battery. We also announced two Simplicity tractors offering electronic fuel injection (EFI) for ultimate performance in starting and operation, including a new sub-compact tractor with drive-over mowers and a new front-end loader.
We introduced the new Briggs & Stratton 8,000-watt Elite Series portable generator with StatStation Wireless Bluetooth, which makes it easy and convenient for homeowners to monitor the generator from a smart device.
2) How will the election of Republican Donald Trump as president, along with Republicans maintaining control of Congress in both the House and Senate, impact the OPE industry?
HR: Every election brings potential changes to the industry and the business climate. We will closely monitor President-elect Trump’s new administration and introduction of new policies to gauge the impact on our company, both domestically and on a global basis.
3) What was the OPE industry’s biggest story in 2016, and what do you predict it will be in 2017?
HR: Consumers continue to look for products that let them get the job done quicker and easier. On the residential side of the business, commercial features continue to trickle down to zero-turns designed for homeowner use. Commercially, professional landscapers continue to look for products that make them more productive and allow them to expand their services beyond cutting.
Ferris with Oil Guard will be a big story in 2017. Increasing productivity by extending maintenance intervals, reducing downtime and costs, and increasing engine life creates benefits for commercial cutters not previously available. It’s a game changer.
4) What will be the OPE industry’s hottest trends in 2017?
HR: Meaningful innovations will rule the day. Bluetooth and IoT (Internet of things) technology that let homeowners monitor their equipment or commercial cutters manage their businesses will become a significant part of new product introductions for the future.
Lithium-ion battery technology will continue to improve, providing both homeowners and commercial cutters with more battery-powered options than ever before.
5) What is your overall outlook for the OPE industry in 2017?
HR: We expect moderate growth in outdoor power equipment as the housing market remains favorable in certain segments, including those that drive sales of zero-turn products. The “do it for me” market, which drives much of the commercial-cutting industry, has been growing at a modest pace over the past several years, and we expect this trend to continue. Companies and dealers offering innovative products and unique service solutions will gain a competitive advantage and capture more customers.
BJOERN FISCHER
PRESIDENT
STIHL INC.
(VIRGINIA BEACH, VA.)
1) What is new with your company and/or any OPE industry associations that you represent?
Bjoern Fischer (BF): This has been a very exciting year for Stihl. As we celebrated our 90th anniversary internationally, and our third generation of family ownership and leadership, here in the U.S., we also celebrated another year as the number one selling brand of gas-powered handheld outdoor power equipment among U.S. professional landscapers*.
The lifeblood of any manufacturer is new products, and meeting the changing needs of our customers. We are excited to announce that we have initiated one of the largest product launches in Stihl Inc. history, including 40 new product models across multiple categories. Launching this spring are nine new cordless product models in the Stihl Lightning Battery System, as well as 31 new gas-powered models. And customers can look for even more new product launches throughout the remainder of 2017.
We are especially pleased with how this will benefit our network of Stihl servicing dealers. New products will better enable them to serve their existing customers, but also draw in new customers, especially with the addition of the battery products.
2) How will the election of Republican Donald Trump as president, along with Republicans maintaining control of Congress in both the House and Senate, impact the OPE industry?
BF: It is not especially beneficial to speculate on what kind of policies President-elect Trump will enact once he takes office. As a privately held company with global operations, we recognize that there are always shifts and fluctuations in the political landscape that impact market and economic trade activities. Our focus has always been on the long-term strategy rather than the immediate future. This long-term outlook has served us well in the past, and we expect it to allow us to adapt to future changes as well.
That said, the incoming administration’s focus on strengthening U.S. manufacturing is certainly key for us at Stihl Inc. given our significant manufacturing footprint in the U.S. We certainly hope that our representatives will work with the OPEI and other trade associations for legislation and regulations that will be favorable for small business and manufacturing, especially in the areas of infrastructure, taxation, energy resources, and health care.
3) What was the OPE industry’s biggest story in 2016, and what do you predict it will be in 2017?
BF: New products reflecting consumer demands that rely on battery rather than fuel power are emerging at a relentless pace across numerous product categories. This past year, we have seen an expansion of battery-powered product lines across the industry, and we expect to see this continue in 2017. Reducing the carbon footprint of OPE is important to homeowners, professionals and municipalities. Stihl is applying its strength of innovation to a new generation of products with the launch of the Stihl Lightning Battery System in the spring of 2017, as well as 50 new, emission-conscious, gasoline products before 2020.
Stihl will offer an expanded battery product range with three distinct lines of battery-powered products that allow users to choose the right tool to get the job done based on how much work they can do on a single charge. Not only is Stihl answering the demands of homeowners and landscapers by allowing them to pick their power, but we are offering our servicing dealers more options than ever to satisfy their existing customers, and attract new ones to their business.
4) What will be the OPE industry’s hottest trends in 2017?
BF: I expect we will continue to see expanded growth in the battery-powered segment across the industry. We also see an overall continued trend in products designed that leverage advanced technology for increased user efficiencies. Manufacturers are focused on making products that are lighter with increased fuel efficiency, lower vibration, longer run times and extended service intervals. These features enable users to save time and money whether it’s on the job or working in their own backyards. For professionals, these features save time and money, thereby allowing them to maximize profits as they are able to get more done in a day’s work.
We’re also seeing additional technologies aimed toward increasing efficiencies and improving analysis. Stihl is investing in new software platforms to support end users and professionals with product data analysis. For example, the new professional platform of Stihl products are compatible with the Stihl MDG 1 tool, which permits review and analysis of operating data memory including operating hours and speed duty cycle. This provides great value to maintenance managers as it allows quick and easy analysis of total cost of operation.
There has also been a continued trend of independent dealers taking market share from big box stores. Customers are growing tired of the warehouse experience, and are looking for more personal service. Dealers continue to be focused on being more consumer friendly as they offer solution-based services and product offerings, like Stihl, that can’t be found in the mass merchants. Stihl dealers service what they sell, offering them an edge over the big box stores. And dealers are becoming more sophisticated as well. They are taking advantage of the latest technologies in online training and new software to run their business more efficiently, as well as the latest in marketing and communication channels like mobile and social communication.
5) What is your overall outlook for the OPE industry in 2017?
BF: The outdoor power equipment landscape is changing. We are all adjusting to new forms of media and discovering new ways to connect to our target audience. That audience is growing and becoming more diverse with more millennials and women than ever. This creates new challenges as we look to communicate not only with our traditional OPE customer, but the new generations that are reaching life milestones like purchasing a house later in life, and don’t look at activities like landscape maintenance the same way as previous generations. We will need to take into account new lifestyle priorities and respond to the changing marketplace across the entire communications spectrum, not just the traditional TV and print media. This is an adjustment for most industries, not just ours.
We do expect spending on home improvements to grow and that OPE dealers will continue to make gains in market share against the big box stores as customers recognize the advantages of buying local and the benefits of shopping with a knowledgeable dealer that also provides service. As mentioned earlier, battery is the fastest-growing segment. With our expanded product launch, specifically the consumer-friendly additions, Stihl will enable dealers to compete with big box stores more than ever by offering quality products with the Stihl name at a competitive price point. We are confident that our ever-growing product lineup will be a significant contributor to market share growth for independently owned businesses.
* Number one selling claim based on 2007-2016 Irwin Broh Research syndicated research of the U.S. professional landscaper market.
