EXECUTIVE COMMENTARY
by Walter E. Tobin, ERA CEO
Walter Tobin, ERA CEO
Whew! So much to unpack as I sit down to pen this article. Our industry is facing so many challenges — some may say chaos — on so many fronts. Others may look at the glass being half full and adopt the motto: “Out of change and chaos comes opportunity.”
As I write this, we are in the early stages of tariff implementation by the U.S. – no politics here – but all of us are hopeful that this move may help drive more companies to move factories back to the U.S. Certainly, it will take many months for our industry to see a lot of movement here. Can the past thoughts of lower cost of manufacturing, lower wages, emphasis on low prices and PPV to maximize stock prices and shareholder value be reconciled by Wall Street? Can companies who chose to move manufacturing back to the U.S. and experience higher manufacturing costs and lower margins avoid having Wall Street punish their stock price? Only time will tell.
As we finish CYQ2, we are now at the doorstep of 2H2025. Haven’t we heard that the turnaround will happen in “second half?” What will be different on July 1, 2025 that differs from Q2?
All of us are weary and tired from relying on hoping that things will “turn around in six months.” So, what now? Do we all just sit around and hope that things get better? Who has the magic wand to wave and poof, the market is back? No one.
Do we just sit back and try to wait this out? To mark time, tread water, try and keep our companies together and employees motivated to “hang in there.” How long will we be able to financially subsidize both our company and our employees while we sit back and wait for things to improve? Many companies are losing employees to other industries as folks decide that they cannot wait this out any longer.
As we sit through the third year of waiting, many companies have decided to try and save their way to prosperity: cutting travel, entertainment, training, advertising, hiring new employees, investing in new tools, etc. They just want to hang in there just long enough to survive and be positioned for when the market finally turns around.
Yet… when the market signals that it is turning around, will it be too late for your company to react? Will you miss the initial 90 days of the turnaround because you saved your way to complacency?
Someone told me years ago that there are three kinds of people in this world: 1) Those that make it happen, 2) Those that watch it happen and 3) Those that wonder what happened.
I think all of us perceive that our companies are considered in the first category. But are we really? Do our actions and initiatives, today and now, reflect this “make it happen” mantra? Or are we just watching and then wondering what happened? And then we may wonder how we could have missed the turnaround after it happens.
I am not naïve about the real challenges that all of us are facing, trust me. The pressure on top line revenue growth, expense control and bottom-line profit are real. But what can any of us really do now to get into and stay into category #1 above?
Some thoughts and suggestions:
• New hires. Now is the time to restock the pond – to find, interview and train new employees who can hit the street running and beat your competition to the punch when the market turns. It takes at least 90 days to find, interview, hire and train new employees. The time to do this is before the market turns, not after. The competition on capturing new employees will be much more severe after the market begins to pick up.
• New training initiatives. When was the last time your sales teams received sales training? Have they ever had professional sales training? Oh, they may tell you they do not need it. “I have been doing this a long time”… “I do not not need any training.” Sound familiar? What if they have been doing it wrong for years? There are many great training programs out there. I will include here a shameless plug for the ERA STEP training program to be held October 7-9 in a live/virtual format.
• New productivity tools. Did you attend the ERA Conference? There were several new and exciting productivity tools that were presented. If you attended, the slide decks of all of the breakout sessions are available on the ERA Conference mobile app.
• Website and digital marketing refresh. What is your mar-comm plan? How do you look to the outside world? Get an agnostic look at your digital footprint…you may be horrified! If you are, now is the time to invest in your digital image. It is who you are to the outside world. Do not look like a fossil.
• Funnel review and scrubbing — a.k.a “Fish where the fish are” and turn open quotes into orders. Your manufacturers ask you to review the backlog—review it on your own and try and convert open quotes into orders. Many of us never ask for the order. Get professionally aggressive with your customers. They will respect you for asking.
• Deeper dive into existing customers. Do you really know all of the key people? Have you looked at your customer’s website? Recent press releases? New contracts? There is a treasure trove of great information out there that knowing it gives you a huge advantage over your competition.
• New customer and market developments. Who competes against your customer? What do they buy? Who are your customers’ customers? Do you know who your customer’s VP of Sales is? VP of Marketing? What are they working on?
• AI tools. Seriously, why are we still trying to convince so many of us to get into AI? I ask folks if they are using AI: they tell me, “Of course.” I ask them how they are using it…if they pause, it means that that they are not using AI! Give your AI strategy to someone who owns it—a fractional AI single point of contact who can teach all of your employees the latest tools. What are you waiting for? AI has been out for four years. Do you use it? If not, you will miss the boat near and long term. Here is another shameless plug for ERA SearchLink.ai—take a look at the tutorials at era.org/era-searchlink-ai-resources. Sam Richter walks you through how to use AI. Get on board now or get left in the dust.
So, take a deep breath. Decide what your plan is and what category you are in now and what category you want to be in. Make the tough decisions now. Your competition and manufacturers will take notice, trust me.
Do not miss the opportunity now while the market is sleeping. Once the giant wakes up, you will miss the upside and have to play catch-up while your competitors take market share, lines and customers away from you.
Get your game face on and elbows up as you skate into the corners. Skate where the puck is going … not where it is today!
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EXECUTIVE COMMENTARY
Walter Tobin, ERA CEO
by Walter E. Tobin, ERA CEO
EDS 2025 is now in the history books – did you go? Did you get a lot done? Have you reviewed your notes and action items? Have you reached out to those folks who represent the business cards sitting on your desk just waiting to be followed up on or responded to? Remember: the “follow up” shelf life is 2-4 weeks after any event or meeting. After that, don’t bother. You missed the window and wasted your time at the event or at the meeting. All of your travel woes, dinners, full days and nights will now be wasted. Remember the saying: “Never confuse activity with accomplishment.” You ran around for five days, but what did you get done?
What was the mood at EDS? Excitement? Candor? Nervousness? Are the other companies in my space doing better than I am? If so, why? Do I even believe them? Should I tell the truth when I am asked: “How’s your business? How is your year going?”
I sensed a lot of enthusiasm at EDS. Perhaps, if we tell each other a few fibs, perhaps we can all believe that things are indeed getting better! End-customer inventory seems to be leveling off; lead times are falling; book-to-bills are getting back in the positive ranges. So why am I not seeing the uptick? Or am I?
The topic of tariffs was also never-ending. What should we charge? How much can we lose if eating some or all of the tariff? What is my competition doing? What if my customer agrees to pay the tariff and then short-pays the invoice, paying only for the piece part and not for the tariff? Should I/can I put them on credit hold? What if they are my biggest customer?
The whole tariff discussion does have a bit of a silver lining: we are getting audiences with senior managers at our customers that we have never gotten! They want to understand our position and/or try and leverage their size and relationship with us to avoid paying any tariff. (Is that fair?) How we handle ourselves at these senior-level meetings will have a long-term impact on our presence at the customer.
Frankly, so many of us are just tired of this uncertainty and waiting for something to happen, for someone to declare: The market has turned! Happy days are here again!
There are now so many indices that represent how the market is doing. Book-to-bill ratio, lead times, end customer inventory levels, imports/exports levels, unemployment levels, new jobs created/lost, interest rates, deficit levels, inflation levels, interest rates…enough! How can I make sense of all of this? What is up is now down and what used to be good may now be bad. Sometimes I think we all need to just stop. Or at least pause.
We all know what our organization needs to do now to make it better:
• Plan for the future. Invest in new productivity tools – funnel management, lead follow up, etc.
• Use AI in all areas of your business – what are you waiting for?
• Train our people – when was the last time you did any training?
• Enhance your digital image.
• Hold performance reviews to help lower performers get better or have them exit the business — when was the last time you even did performance reviews?
The old maxim was that when business got tough, the three areas that most companies cut back on were advertising/marketing, travel and entertainment (customer visits) and training. Shouldn’t these be the three areas that you want/NEED to invest in?
Stop waiting for an excuse to put off these critical areas because when the market does turn, you will be stuck with the same systems, productivity tools, digital image, poorly trained sales teams and non-performing employees.
There is a saying: “A rising tide raises all boats.” Rising sales covers up a lot of barnacles and holes in any boat. Whew! Thank goodness no one saw how bad my boat was…but the high tides now cover a lot of sins.
When was the last time you asked your customers/ manufacturers to do a review of your company? How are you doing for them?
Have you ever proactively flown to visit your manufacturers’ headquarters to tell them what you are doing now for them, and then asked them for their feedback?
You want to stand out from all of your other competitors. Separate yourself from those who are calcified from fear of taking action.
Work now to make your company and your people stand out. Be the best you can be – invest, hire, train, improve! Be positioned now to be ahead of your competition when the market does turn.
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