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Business Review Western MI
Business Review Western MI
Trendway Surges
(2007-09-05)
(wgvu) - Trendway surges as industry forecasts slower growth


Sept. 6, 2007

By Mark Sanchez
marks@mbusinessreview.com

As industry expectations moderate again, Trendway Corp. expects to
sustain double-digit growth into 2008.
The Holland-based office furniture maker is riding a 21 percent increase
in sales through July and a 19 percent year-to-date growth rate in
orders.

As business remains strong, the privately held Trendway is in the midst
of acquiring and installing $1 million in equipment to expand
manufacturing capacity, and recently added about 30 production staff to
its work force of 350.
Trendway President Bill Bundy sees the strong growth continuing through
2007 and said the company will aim for another 15 percent sales gain in
2008, even as an updated industry outlook depicts slower growth ahead.

The company, Bundy said, is positioned to have a great September.

We've put things in place that will help us grow, even if the industry
slows a bit, but you've got to keep working at it and pay attention, he
said.

Bundy credits Trendway's strong growth so far in 2007 to:
New-product introductions
Stronger sales leadership
A service model implemented a year ago that guarantees on-time
delivery or the order is free.

If maintained through the end of the year, Trendway's sales growth would
by far exceed the expectations of an updated outlook from the Business
and Institutional Furniture Manufacturers Association.

The Grand Rapids-based BIFMA now projects shipments to reach $11.4
billion in 2007, a growth rate of 5.5 percent over 2006.

Shipments in 2008 are projected to grow 2.3 percent to $11.7 billion,
according to the updated forecast prepared by Global Insight and issued
last week.

The latest BIFMA outlook, updated quarterly, represents another
downgrade in expectations for 2007 and 2008. The previous quarterly
forecast, issued in May, predicted growth of six percent in industrywide
shipments for 2007 and 4.3 percent in 2008.

The forecast reflects slowing economic growth and concerns about the
economy stemming from the housing slowdown and subprime credit crunch,
as well as volatility in the stock market, BIFMA Executive Director Tom
Reardon said.
The single biggest factor moderating the 2008 outlook is a softening in
projections for future new office construction, Reardon noted.

The outlook for the remainder of 2007 is in line with how industry
shipments tracked through midyear, growing five percent over 2006.

We think that'll hold up for the rest of the year, he said.

The U.S. Commerce Department last week reported the gross domestic
product grew at four percent in the second quarter, up substantially
from the 0.6 percent in the first quarter. The department said business
investments and exports partially offset problems in the housing market.

Comerica Bank chief economist Dana Johnson now expects GDP of 2.1
percent during the second half of 2007 and an annual rate of 2.1 percent
in the first half of 2008, continuing a mediocre pattern of growth in
recent quarters and resulting in sluggish job growth nationally.

In addition to a smaller GDP, job growth nationally has slowed since the
spring, and it could slow a little more, The Conference Board also
reported last week. A decrease in the July help-wanted index from
previous months reflect slower economic growth in the third quarter than
the second, Conference Board labor economist Ken Goldstein said.

Both the economy and the job market could be growing a little more
slowly in the fourth quarter, but not slowing dramatically. And to date,
the data show no suggestion that the economy is in danger of slipping
into recession before the year is out, Goldstein said.

Mark Sanchez
Business Review Western Michigan
800 N. Monroe
Grand Rapids, Mich. 49503
Direct: 616-222-5832
msanchez@mbusinessreview.com
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