HALO Branded Solutions (asi/356000), the industry’s largest distributor, is seeing a similar healthy trajectory. “There’s a lot of business to be had if there are resources to execute.” “Our focus is on maintaining and growing current relationships and expanding our client base,” he says. Memo Kahan, president of Top 40 distributor PromoShop (asi/300446) in Los Angeles and a member of Counselor’s Power 50 list, says Q3 sales were up 30% year over year, and his company is on track to see 15% to 20% year-over-year growth in the final quarter. In Q3, meanwhile, promo products distributors say they enjoyed a lingering post-COVID energy among customers eager to spend, despite warnings of a recession. In addition, stock for e-retail giant Amazon fell 20% in late October due to anemic expectations for Q4, normally the company’s busiest time of the year, as consumers show signs they’re becoming more cautious with buying. Twitter, in fact, laid off half of its workforce last week, just a week after Elon Musk took the helm as CEO. Reports over the last week indicate that some of the largest companies in Silicon Valley, including Amazon, Meta, Lyft and Stripe, are warning that they’ll be paring down their payrolls in the coming months as they look to cut expenses in the face of inflation, high energy costs and skyrocketing interest rates. 4 was better than expected, with 261,000 positions added last month, though the unemployment rate ticked up to 3.7%, the slowest job gains rate in nearly two years.Īnalysts say the jobs market is still strong, though major corporations are already announcing layoff plans. The October jobs report from the Labor Department released on Nov. Inflation stands at just over 8%, while the average interest on 30-year fixed mortgages has now surpassed 7% for the first time since 2002. While consumer spending increased 1.4% in the quarter (though it was down from 2% in Q2), investment in housing fell 26% due to skyrocketing interest rates on mortgages following a series of hikes by the Federal Reserve, the most recent one on Nov. We expect the economy to enter a mild recession in the first half of next year.” “Exports will soon fade and domestic demand is getting crushed under the weight of higher interest rates. “Overall, while the 2.6% rebound in the third quarter more than reversed the decline in the first half of the year, we don’t expect this strength to be sustained,” wrote Paul Ashworth, chief North America economist at Capital Economics, as reported by CNBC. However, experts warn the gains could prove to be short-lived. Bureau of Economic Analysis (BEA), which found that GDP increased 2.6% between Q2 and Q3, marking the first period of positive growth for the year.Įconomists say the increase, above initial estimates of 2.3%, came about in large part from a strong jobs market and narrowing trade deficit, plus increases in consumer spending, nonresidential fixed investment (capital expenditures) and government outlays. ![]() ![]() The findings appear to be in line with the larger state of the economy, according to the U.S. The Counselor Confidence Index also rebounded, increasing to 107 from 103 in Q2, as recession fears manifested in the previous quarter. This year, distributors say the optimism has continued, with even more events returning, far fewer travel restrictions, and ongoing pushes to continue engaging employees during new work setups. The increase of promotional products Q3 sales is more impressive considering that last year’s Q3 was a strong quarter, as events began to come back, travel opened up and distributors filled holiday orders – all before the winter onslaught of Omicron. While larger firms fared slightly better than smaller (15.3% of companies with $5 million or more in revenue reported an increase for the quarter, compared to 12% of those with revenue of $250,000 and under), the gap between the revenue classes shrunk noticeably compared to previous quarters. In fact, nearly 70% of distributors said their sales had increased from Q3 in 2021, and almost two-thirds reported that their results for the quarter exceeded expectations. While that number is below the 13.5% increase reported last quarter, it was an optimistic report overall. That’s according to the new Distributor Quarterly Sales Survey from ASI Research, which found that distributors in North America increased sales, on average, by 12.4% in the third quarter of 2022 when compared to the same quarter last year. Despite all the rumblings of a recession, most distributors have yet to see a pullback in client buying habits.
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