ACHR NEWS Editorial Staff

COLUMBUS, Ohio — The monthly TRENDS report from Heating, Air-conditioning & Refrigeration Distributors International (HARDI) shows that sales by member distributors participating in the survey declined by 4% during September.

The sales growth rate for the 12 months through September 2023 was 3.5%.

“Distributor sales during September were off by 4 percent from September 2022, but that number needs some context,” said Brian Loftus, HARDI’s macroeconomic and residential market analyst, in a press release. “September this year had one less billing day than the prior year. We estimate the sales growth was near 1 percent with the same number of billing days versus September 2022, when sales were up by 17.6 percent. Sales this month are up by 12.9 percent versus September of 2021.”

From that perspective it looks like distributors are treading water at an elevated level, Loftus said.

The Days Sales Outstanding, or DSO, a measure of how quickly customers pay their bills, was near 41 days during September 2023. “The DSO has a normal seasonality throughout the calendar year,” said Loftus. “The post-Covid DSO for September has remained near 41. There is still no sign of stress from distributor customers despite the Fed’s actions to slow the economy.”

The post-COVID U.S. economy has been incredibly resilient, Loftus said. Despite the Federal Reserve increasing interest rates 11 times since the spring of 2022, some 336,000 jobs were added to the economy during September, the strongest monthly increase since January, when 472,000 jobs were added, and the latest gross domestic product growth of 4.9% was stronger than most estimates had put it.

“The performance of our economy during the past year has been very impressive. We expect the higher interest rates will cool our economy during the year ahead,” said Loftus.

HARDI members do not receive financial compensation in exchange for their monthly sales data and can discontinue their participation without prior notice or penalty. Participation is voluntary, and the depth of market coverage varies from region to region. An independent entity collects and compiles the data, which can include sales information about products not directly associated with the HVACR industry.