Businesses Moan: "All Costs Are Increasing", Everyone's Behaving Like Bankruptcy Is Imminent

Clothing Manufacturer

Photo: Dr John 2005 flickr

From the just released Chicago PMI, the most interesting part… the anecdotal comments from survey takers.It’s a mix of good and bad.


1.    ―Companies still skittish and intense pressure from boards / stock market. Companies that are very profitable still behaving as if bankruptcy is around the corner.‖

2.    ―We are continually finding and hiring qualified new employees. We are also adding new equipment. The backlog is now over our levels prior to the recession.‖

3.    ―It appears suppliers are finding more creative ways to institute price increases with the most recent being —unprecedented surcharges.‖

4.    ―Prices on plastic resin and cotton continue to press suppliers to the point where they are increasing prices or refusing business – first time I’ve seen this in years.‖

5.    ―First price increase to customers due to the commodity pressure on steel, copper and aluminium.‖

6.    ―Due to our company using products with an asphalt base, we expect to see continued increases throughout the construction season.‖

7.    ―All costs are increasing. Chemical costs are at recent time highs.‖

8.    ―Capacity issues at suppliers were exacerbated by the tragic events that unfolded in Japan.
Much concern regarding our ability to grow as the limited availability of many raw materials propagates. Inadequate capacity at the feedstock levels of most concern due to the lengthy and expensive work required to ramp it up. This bottleneck causes obvious issues throughout the entire supply chain. A couple of years of constrained growth could be good in the long term but can also cause panic in sectors already straining to stay afloat while hoping for a sustained economic recovery.‖

9.    ―Commercial Banking activity is picking up. Commercial Real Estate valuations stabilizing.

10. ―New orders fell slightly this month but hopefully we can get some of the backlog through
engineering. Quote requests continue strong.‖

11. ―Where did all the orders come from?‖

12. ―Finished the 1st quarter ahead of plan. Have our fingers crossed for the second quarter.‖

13. ―Record month in March.‖

14. ―The economy in our markets are still hot!‖

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