MTD Products’ president of U.S. business units, Gary Lobaza, provided an industry update to members at the Outdoor Power Equipment and Engine Service Association’s (OPEESA) Annual Meeting earlier this month. The 45-minute keynote presentation highlighted key trends and industry dynamics affecting MTD and its competitors, suppliers, distributors and customers. Among these were continued retail developments and the impact of giants like Amazon; the growth of battery-powered products amid the relatively steady pace of traditional gas equipment; the rise of smart speakers, smart homes and smart yards; and, notably, commodity costs that have been adversely affecting the industry for the last decade.
MTD, like manufacturers in a variety of industries, is feeling the squeeze of global inflationary pressure that has fueled a steady increase in the cost of raw material, energy, freight, and labor since 2008. In a conversation following the keynote, Lobaza said MTD has worked diligently to implement productivity enhancements and manage costs. Now, the company is finding these efforts alone are no longer enough to offset the cumulative impact of higher costs, and MTD may need to consider a more aggressive 2019 pricing program in an industry where margins are very competitive.
“Any change in pricing will impact each product category, price points, retailer, and manufacturer differently,” said Lobaza. “As a global leader in the industry, MTD understands our responsibility and remains committed to ensuring quality outdoor power equipment remains available at suggested retail prices that deliver the value proposition our customers want.”