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THE BUZZ |
Egret Consulting eNewsletter |
June 2009 Vol. 10 Issue 6
Let's All Just Breathe By Ted Konnerth There are forecasters, media reporters, economists and a dozen or so other occupations that diligently spin facts. This newsletter speaks to one huge issue, largely hidden from our industry; there is a small pot of $38.5B waiting to be invested in our industry. The electrical industry is roughly a $100B industry, and yet there are $38.5B in available funds; today. First, let's talk forecasts, economics and spin doctors. Here are actual economic 'facts': - Consumer confidence index rose to 54.9 in May, up from Robert Johnson, Economic Advisor for Morningstar reported that less than 5% of the TARP funds have been spent, and yet the economic indicators are showing improvement. Most of the TARP funds will be spent over the next 12-18 months. Additionally, Mr. Johnson said that unemployment as an economic impact is offset through consumer spending, such that a 1% rise in consumer spending will completely negate an additional 1% rise in unemployment. Further, unemployment will rise during the recovery since the ranks of those no longer counted as 'unemployed' will begin to re-enter the job market. (see a link to his discussion, below).¹ So, what's that all mean? Well, for one, things are improving, but there's still a way to go. The media dwell on negativity and fear, so its' just as easy to report 9% unemployment or 91% employment; but we never hear about 'employed people'. Materials are cheaper, the dollar is strengthening, and there is an incomprehensible amount of money poised to be spent in this country; right now. The funds are allocated, so it's literally up to each industry to figure out how to get the money. Obviously every well-connected politically aligned company is already in line for money, but at a recent conference on Clean Energy, Andy Karsner, who is the Assistant Secretary for Energy Efficiency and Renewable Energy (his business card is a billboard) reported that there are $38.5B 'gathering dust' awaiting to be spent on anything that conserves energy.² $38.5 BILLION!! The funds are appropriated and ready to be spent. They EXPIRE in 24 months, so it's literally a money grab to those who apply for it. The funds are appropriated for 'anything that saves energy'. The likely assumption would be that our industry should reap the bulk of those funds, if anyone actually applies for them. You can 'save energy' through insulation, HVAC improvements, new roofs and windows, etc. But the potential boost into our industry is unprecedented. New technologies for power generation of solar or wind are obvious choices to garner a chunk of those funds, but LED technology in lighting, variable speed drives, DC distribution systems for large data centers, building automation, occupancy sensors, lighting retrofits all qualify for funding under the stimulus funds. I've been dismayed how few of our electrical distributor clients have created a plan for entering the 'green' market. Wind farms buy $100M's of wire, cable, controls, transformers, connectors, insulators, panels, etc. Right now, most of those products are sold on a direct basis to the GC or turbine manufacturers. There is a huge value proposition to a distributor to create a single solution model of selling and servicing the requirements for construction of wind or solar installations. Our industry will emerge faster than most. But if we wait until automotive and housing rebound, the stimulus money for new technologies will be gone. This is the time to invest in growth; hire a solar or wind energy industry expert to help your company create the strategy for emerging markets, hire an attorney who can help you understand the stimulus funds and how to apply and get them. Do something other than watch the same reporters tell you how bad it is. In short... guard your mind, and grow. 1. Johnson, Robert. "At Last, Employment Seems to be Stabilizing". (2009) Morningstar. Retrieved June 4, 2009 from 2. Karsner, Andy. "Andy Karsner at San Francisco Cleantech Forum XVI: A $38.5 billion U.S. appropriation has been secured for clean technology initiatives, but is "collecting dust," according to the U.S. DOE's Andy Karsner "(Video). (2008) Cleantech Forum / Cleantech Group LLC. Retrieved June 4, 2009 from http://cleantech.com/news/2681/karsner-cleantech-video-san-francisco-forum.
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"Motivation is simple. You eliminate those who are not motivated." -Lou Holtz |
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Ask an Expert Please email us your question and look for the answer next month. Read the answer to this month's question about: Networking for the Job? | |
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Egret Survey of the Month:
This month's question:
Please take 7 seconds to tell us how you think your company will fair the last six months of 2009?
Last month's survey results:
Question
Why do you think there aren't more women in management positions in this industry?
Responses: 10.9% Said
End
Customers won't
accept them 56.5% Said there is no
serious attempt to
recruit them
30.4% Said women aren't interested in the Electrical Industry Population:
32.6% Manufacturers
54.4% Distributors
13.0% Others | |
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Industry Events NeoCon 2009 Waterpower XVI | |
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Industry Specialties | |
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Mergers & Acquisitions We offer confidential consulting services to help you sell, or re-capitalize your company. Our 25 years of industry relationships offer a unique process of confidentially identifying the 'right fit' buyers. Contact Ted Konnerth, tk@egretconsulting.com, for a consultation on marketing or re-capitalizing your company. | |
