I don’t know how many tradeshows I have been to over the past 40 years, but certainly the number is well north of a hundred. By the fall of 2018, I was pretty sure that nothing could happen at one of those events that hadn’t happened at least once at a previous show. Turns out I was wrong.
When I go to a tradeshow, one of my goals is to meet on an individual basis with approximately 40 exhibiting companies, with either the general manager or the director of marketing. I don’t try to sell them anything, per se. Usually we talk about their product, and my product, and about advertising in general. Sometimes, of course, we talk about sports, or old times, or the industry, or how the show is going.
Before we part, though, there is one question I nearly always ask them. The words may vary a little, but the gist of it is something like, “Aside from the show, how is your business doing right now?”
I’m accustomed to receiving a variety of answers, and I’ve learned to take them with a grain of salt. It’s not as though somebody working a trade show is going to tell you that business is horrible and the company is sinking like a stone, but you can usually read pretty well between the lines. If things aren’t good, for example, you might get an answer like, “We’re doing pretty well, considering …”
At the EDspaces Convention in Tampa this past November, I didn’t get any answers like that. Virtually everyone at the show gave me a very succinct answer, and in each case it was the same word. They said that business is “great.”
That this show should exhibit the most positive outlook of my career is especially remarkable when you consider that my first trade show was in 1978. Those were boom days in the school supply industry, such as we have never seen before or since. New teaching-aid manufacturers, and the teacher stores that thrived upon them, were sprouting like mushrooms in a soggy forest.
Back then, it seemed as if anyone with a good idea and the courage of his or her convictions could make it work. There were fortunes to be made, and a lot of people made them. Even in that environment, however, there was never anything like universal optimism at a tradeshow. There were always winners and losers.
So why was sentiment so positive in Tampa? Basically, I think it was due to the fact that the stars were finally aligned.
Most industries respond to the U.S. economy in real time. If consumer confidence goes down, for example, people can stop shopping in department stores that day. Houses and cars have a bit more of a pipeline, but that can dry up pretty quickly, and some orders may even be cancelled. On the flip side, whenever consumers start to feel better about their prospects, they go shopping.
The school supply business, as you know, is a little harder to figure. School budgets are preordained, and building projects take years to complete. Once construction begins on a school, it isn’t likely to stop. Things like enrollment and property taxes have a more direct bearing on our business than does consumer sentiment.
For these reasons and others, expansions and contractions in our market do not necessarily coincide with the larger national economy. During those boom days in school supply for example, there was a particularly nasty recession that ran from the fall of 1973 to the spring of 1975. The next downturn covered the first half of 1980, and was followed barely a year later by still another, which lasted 14 months and caused close to 11 percent unemployment.
On the flip side, the steep decline in the teacher store business over the past nine years has happened during a period of continuous growth for the U.S. economy. There may be quite a few suspects to round up, but the economy is not one of them.
The furniture and equipment side of the industry is a different, and more complicated, story. According to School Planning & Management magazine, school construction dwindled steadily during the early years of the 21st century, through good economic times and bad.
In 2002, there were 958 new public schools constructed, but by 2014 that number had dropped to 288. The effect of that trend on our industry was softened somewhat by an equally sharp escalation of cost per school. That number rose from $13 million in 2002 to 27 million in 2014.
Given that there are nearly 100,000 public school buildings in the United States, those statistics might lead you to suspect that our school infrastructure is in need of attention, and you would be correct. More than half of our schools are more than 50 years old.
Although nobody seems to have a precise figure yet for 2018, everyone I spoke with agreed that school construction is finally on an upswing, both in terms of new buildings and the remodeling of aging structures. Put that trend together with a U.S. economy that has been growing at better than a 3 percent rate in recent quarters, and you get a pretty good explanation for all the optimism at EDspaces.
I wish I could leave it at that, but being a glass-half-empty kind of guy, I’ve never been quite satisfied with “and they all lived happily ever after.” Nobody’s that happy, right?
Ever since I came back from Tampa the financial markets have been in turmoil, presumably because investors are worried about the possibility of a recession. Apparently I’m not the only pessimist around, but you have to ask why there should be so much anxiety when economic indicators are so robust.
I’ve heard a lot of differing explanations. One day when the market was tanking, for example, I was watching the financial news on television during lunch. An “expert analyst” on the program said that the selloff was due to worries about a trade war with China, “plain and simple.” I switched over to a different financial channel, where a different expert was saying that the market drop was all about interest rates.
I’ve also heard that “Brexit” could make a mess out of Great Britain that could ripple through the world economy. I’ve heard that oil prices could go too high, which hurts consumers, or too low, which hurts producers.
The biggest fear, I think, is simply that we are due. Since World War II, the average period of time from the end of one recession to the start of the next is four years and nine months. Right now we are approaching twice that length of time since the current expansion began.
So we have a lot of things we can worry about. Good. I feel better now.
You can e-mail Kevin at email@example.com.