April 2014 Survey Results:
The overall MCI-EFI is 65.1, unchanged from the March index.
- When asked to assess their business conditions over the next four months, 37% of executives responding said they believe business conditions will improve over the next four months, up from 31.4% in March. 60% of respondents believe business conditions will remain the same over the next four months, down from 65.7% in March. 2.9% believe business conditions will worsen, unchanged 0414from the previous month.
- 37% of survey respondents believe demand for leases and loans to fund capital expenditures (capex) will increase over the next four months, up from 31.4% in March. 60% believe demand will "remain the same" during the same four-month time period, down from 62.9% the previous month. 2.9% believe demand will decline, down from 5.7% who believed so in March.
- 28.6% of executives expect more access to capital to fund equipment acquisitions over the next four months, a decrease from 31.4% in March. 71.4% of survey respondents indicate they expect the "same" access to capital to fund business, up from 68.6% in March. No one expects "less" access to capital, unchanged from the previous month.
- When asked, 37% of the executives reported they expect to hire more employees over the next four months, a decrease from 40% in March. 60% expect no change in headcount over the next four months, unchanged from last month. 2.9% expect fewer employees, up from no one who expected fewer employees in March.
- 2.9% of the leadership evaluates the current U.S. economy as "excellent," down from 5.7% last month. 91.4% of the leadership evaluates the current U.S. economy as "fair," up from 88.6% last month. 5.7% rate it as "poor," unchanged from March.
- 34.3% of the survey respondents believe that U.S. economic conditions will get "better" over the next six months, an increase from 31.4% who believed so in March. 62.9% of survey respondents indicate they believe the U.S. economy will "stay the same" over the next six months, a decrease from 68.6% in March. 2.9% believes economic conditions in the U.S. will worsen over the next six months, an increase from no one who believed so last month.
- In April, 40% of respondents indicate they believe their company will increase spending on business development activities during the next six months, a decrease from 45.7% in March. 60% believe there will be "no change" in business development spending, an increase from 54.3% last month. No one believes there will be a decrease in spending, unchanged from last month.
April 2014 Survey Comments from Industry Executive Leadership:
Depending on the market segment they represent, executives have differing points of view on the current and future outlook for the industry.
Independent, Small Ticket
"I believe there are many projects that were put on hold during the last quarter due to the difficult weather conditions this winter. Equipment acquisition should improve as these projects get back on track as economic conditions continue to improve and the weather turns more favorable. The concerns I have are for the increasing amount of capital that continues to enter the marketplace bringing a downward pressure on yields." Valerie Hayes Jester, President, Brandywine Capital Associates, Inc.
Bank, Small Ticket
"It seems that the U.S. consumer is gaining confidence, which may translate into increased spending. When this segment of our economy actually gains real traction, we will see tangible growth in GDP. The one caveat is the threat of a global event that could stall our cyclical recovery." Paul Menzel, President & CEO, Financial Pacific Leasing, LLC
Bank, Middle Ticket
"The industries we serve continue to make capital investments to support growth activities. Drought in some areas of the country may curtail capital investment this year." Michael Romanowski, President, Farm Credit Leasing Services Corporation
Survey Respondent Demographics:
- Bank: 62.9%
- Captive: 8.6%
- Financial Services: 8.6%
- Independent: 20.0%
- Other: 0.0%
Market Segments Based on Transaction Size of New Business Volume
- Large-Ticket (New Business Volume Avg. Transaction Size Over $5 Million): 11.4%
- Middle-Ticket (New Business Volume Avg. Transaction Size of $250,000 - $5 Million): 54.3%
- Small-Ticket (New Business Volume Avg. Transaction Size of $25,000 - $249,999): 31.4%
- Micro-Ticket (New Business Volume Avg. Transaction Less Than $25,000): 2.9%
Organization Size (Based on Annual New Business Volume for Fiscal Year 2010):
- Under $50 Million: 8.6%
- $50 Million - $250 Million: 17.1%
- $250 Million - $1 Billion: 42.9%
- Over $1 Billion: 31.4%