Last month the Equipment Leasing & Finance Foundation (The Foundation) released their February Monthly Confidence Index for the Equipment Finance Industry (MCI-EFI). According to The Foundation, these monthly indexes provide qualitative insights from key executives in this $827 billion sector, revealing current “business conditions and expectations for the future.” Between January and February, this industry experienced its second highest confidence index rating in two years with an index of 63.3, says The Foundation. This is only a slight decrease from January’s two-year index high of 64.9. According to some MCI survey respondents, Mother Nature seems to have played a part in the decrease of confidence, but optimism is still high.
“The brutal winter experienced by a portion of this country has slowed down many projects that would have been in progress by now,” said Valerie Hayes Jester, President, Brandywine Capital Associates, Inc. “I am hoping that the last third of this quarter will show the signs we had experienced at year end, as demand increased.”
Here are key takeaways from the February Monthly Confidence Index for the Equipment Finance Industry:
- When asked to assess their business conditions over the next four months, 21.2 percent of executives responding said they believe business conditions will improve over the next four months, while 72.7 percent of respondents believe business conditions will remain the same over the next four months.
- 24.2 percent of survey respondents believe demand for leases and loans to fund capital expenditures (capex) will increase over the next four months, while 69.7 percent believe demand will “remain the same” during the same four-month time period.
- 31.3 percent of executives expect more access to capital to fund equipment acquisitions over the next four months,while 65.6 percent of survey respondents indicate they expect the “same” access to capital to fund business.
- 40.6 percent of the executives reported they expect to hire more employees over the next four months, while 53 percent expect no change in headcount over the next four months.
- 93.8 percent of the leadership evaluates the current U.S. economy as “fair.”
- 34.4 percent of the of survey respondents believe that U.S. economic conditions will get “better” over the next six months, while 59.4 percent of survey respondents indicate they believe the U.S. economy will “stay the same” over the next six months.
While there aren’t many solutions to control the weather or the economy, business owners can bolster their business confidence by proactively maintaining and monitoring their business credit. Business owners can stay informed of changes to their business credit profile for free with CreditSignal®* or help impact their D&B® scores and ratings with continuous monitoring features and the ability to add good payment history•• in CreditBuilder. How business owners manage their credit through ‘brutal winters’ and economic slowdowns may dictate access to funding and potential relationships.
With warmer weather just around the corner and based on the confidence index from The Foundation, it appears that the industry is optimistic about both the weather and the economy.
Photo Credit: M. Keefe, Flickr
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