Editor’s Note: In the first iteration of the Portable Plants’ Editorial Advisory Board, participants were asked to share their input on several questions including: What are your thoughts on how the first half of the year has been for the industry and your business? What factors are you seeing that are driving this performance? What are your current expectations for the second half of the year?
Sales in the first half of 2024 have surpassed expectations, marked by significant growth and an increase in repeat customers upgrading or seeking additional equipment.
Manufacturers went into 2024 expecting a 10 to 15 percent growth and most have seen demand meeting or exceeding their expectations, to the point where they are continuing to produce machines to meet demand. Machinery Partner saw its highest sales volume in the first quarter and a notable shift towards engaging with more upmarket clients.
“We’ve seen awesome growth in the first half of the year in terms of demand, especially in the last month or so,” says Chandler Okey, senior account executive at Machinery Partner. “We are seeing more success this year because of the way interest rates have steadily moved down to lower levels on the sales side, which is impacting purchasing decisions.”
Over the last decade, the value of sand and gravel across the U.S. has nearly doubled while production remains relatively the same. Repeat clients are looking for mobile equipment that they can take to multiple job sites.
Business owners in adjacent industries like wood waste and farming are seeing the opportunity to capitalize on the lucrative market of recycling concrete and crushing to the point they are taking in recyclable materials to create new revenue streams.
Factors driving first half performance
Increased demand and market acceptance. The demand for mobile and versatile equipment has spiked, especially appealing to clients ranging from small-scale operations to large commercial applications. The industry is gaining broader acceptance, with contractors increasingly investing in machinery.
“We’ve seen demand double when comparing the first half of 2023 to 2024,” says Daniel Fidanque, growth marketing specialist with Machinery Partner. “There is an expectation to continue to see demand increase. We’ve noticed in previous years an uptick in demand as buyers take advantage of tax savings in the second half of the year.”
Fuel efficiency and cost savings. As fuel prices fluctuate and environmental regulations tighten, the strategic selection of fuel-efficient machines becomes crucial, providing a competitive edge by lowering operating costs and enhancing compliance with current and future environmental standards.
Supply chain and manufacturing improvements. Despite some disruptions, there have been improvements in supply chain management, allowing for faster delivery times and better stock management by manufacturers, which positively impacts sales.
“We’re seeing OEMs that produce smaller equipment and small portable equipment are doing well,” says Clement Cazalot, CEO of Machinery Partner. “This is because there’s growing demand for this equipment. Owners don’t want to be tied down to a specific location to process, but flexible enough to handle any job that comes their way.”
Strong marketing and high-quality assets. Effective use of social media and high-quality marketing assets have played a crucial role in attracting and converting customers.
“One of the driving factors is the diversity of products available,” says David Blair, CTO at Machinery Partner. “There are now alternatives to certain machines that lack supply.”
Machinery Partner has seen social media pay dividends over the first half of 2024.
“One thing we’ve seen work really well is creating engaging and entertaining videos of our machines,” Fidanque says. “Content is truly king in the heavy equipment industry and an easy way to stand out.”
Adds Cazalot: “As a distributor, building a brand to be this one stop shop or a derisk partner is where we see repeat customers,” he says. “There is a value to carrying a longer tail of brands when you can prove you deliver quality.”
Expectations for the second half of 2024
Continued strong demand. The trend of strong demand is expected to continue, bolstered by a robust pipeline of leads and increased marketing efforts. The industry’s acceptance seems to be growing, and economic conditions like favorable financing options are likely to further boost sales.
“I think there are a lot of macro trends that are helping in the aggregate world,” Blair says. “Recycling is becoming more important. We’ve seen pockets of success, for instance, in South Florida where there’s a lot of building going on but not a lot of raw materials.”
Impact of economic and political factors. The upcoming election and its potential impacts on economic policies could influence market dynamics. However, the prevailing sentiment is optimistic given the strong current performance and the strategic positioning of the business.
“The start of the year was one of the strongest ever for Machinery Partner because we saw a delay of procurement from last year to this year,” Cazalot says. “With the rise of interest rate in the U.S. market last year with uncertain lead times, a lot of the larger clients actually have delayed their purchase until now.”
Technological advancements and diversification. Innovations in machine technology – such as hybrid and electric options – are anticipated to gain more traction, aligning with increasing environmental standards and operational efficiency. Moreover, diversification in product offerings is expected to meet a broader range of customer needs, particularly in underserved markets.
“One of the factors that’s also driving our performance is diversity of product,” Blair says. “We’ve added more types of machines that help us address more use cases, or at least provide optionality when there is a lack of availability of a certain machine. There’s an alternative typically. That’s been a positive trend for us and we continue to want to do that to offer more to our buyers.”
The expectation is that innovation will continue to grow the rest of this year.
“We expect manufacturers to keep creating new products, new models and new lineups to answer the new demands of the market,” says Louis Mathieu, OEM account specialist at Machinery Partner. “A lot of exciting stuff is coming from the manufacturing side.”
Overall, the first half of the year has set a positive tone for the industry, with growth driven by both increased demand and strategic advancements in product offerings and market engagement. The outlook for the second half remains optimistic, with expectations of continued growth and adaptation to market and economic changes.
Information for this article provided by Clement Cazalot, CEO of Machinery Partner in Boston, Massachusetts.