October orders drop 50% and renovations rise 40% in Spain

Suppliers plead for 50% orders to secure liquidity in October

October has become the month where much of the industry has stopped deciding. The sector for industrial and services equipment—the one that sells when companies dare to invest—is frozen: rising interest rates and uncertainty have halted purchases, according to those who started the thread from that sector. And with the standstill in place, the ever-present question returns, serving as a thermometer for both bars and the real economy: how are the terraces doing?

They are full. And that is where the problem begins, because the country debates what that means.

Why does a supplier offer goods at a 50% discount?

The ugliest symptom of this October is not a dismissal: it is a sales call. According to a participant in the sector, some suppliers beg their clients to place orders for goods at 50% so they can apply the discount and secure immediate liquidity. In other words: it is not a price cut to gain market share, it is financing disguised as an offer. Those selling below cost to collect sooner are not competing; they are breathing.

The rest of the picture points in the same direction. New projects are not coming in: survival depends on maintenance, and that is not enough to balance the books of a structure sized for something else. The consequence already has its own verb in the sector: downsizing. The culling has begun.

From 20% to 80%: how much activity drops by sector

The wide range of declines explains why no one agrees. According to a worker at an electronics distributor, the drop in orders is around 20-25%, with delinquency and payment delays rising a bit. And there are those who say they are billing half of what they used to. The person who started the thread, in industrial and services equipment, claims their billing is down 80%.

• Electronics and distribution: a participant reports orders 20-25% lower
• Another participant: billing 50% lower
• Equipment: the thread starter claims 80% lower in their case

The striking thing is that all these figures coexist in the same month and in the same country. Some drop by a fifth and others are almost at zero. If the official aggregate does not reflect that hole, it is because the aggregate mixes things that behave very differently.

Do full terraces measure the economy?

Not much, and the hospitality sector itself admits it. Already at the beginning of the 2008 crisis, an acquaintance with a bar warned that there would be a crisis when people could not even afford a coffee; the coffee was still consumed. According to a forum user, the consumption that holds up is the cheap and visible one: terraces, pints, local hospitality. What is cut back is what is not seen: better food, car maintenance, vehicle inspections, insurance, aesthetic treatments, second homes, mid-tier concerts. That money does not disappear from the system: it goes to pay loans, mortgages, and is devoured by inflation.

Hence the insistence on looking at refrigerators rather than tables. The proposed indicator is not how many people are sitting, but what fills the shopping basket on a Saturday morning. And there is more: hairdressers and terraces are cited as more reliable signals than certain indices, because they respond to the money people truly have in their pockets.

Renovations with six months of delay and budgets 40% more expensive

Here the story breaks along the fault line. Those renovating describe the opposite of a standstill: two months waiting for a quote, tradespeople who take six months to appear, and a 40% cost overrun. Other participants point out that plumbers and bricklayers work piece-rate, although there is no generational replacement to cover absences. Thus, two incompatible realities coexist in the same city.

And then there are the businesses that do feel the sudden slowdown. A carpentry shop on a street of carpenters talks, according to those who know it, of a standstill they do not remember even in the previous crisis, when at least they got by with sporadic jobs. In printing and packaging—the boxes for everything consumed—a workshop has closed for the October holiday for the first time in twenty years. That detail, closing for a holiday, says more than any confidence survey.

Tourism: record on paper, hostels shutting down

Tourism is the last firebreak of the official story and also where the most cracks appear. There are testimonies of Camino de Santiago hostels that closed after a weak July and August, with the Ponferrada area empty, and who maintain that occupancy data is manipulated afterwards to support the 'record year.' In parallel, another participant points to a 90% hotel booking rate for the Pilar holiday.

Public money also appears in the equation: some claim to have heard on the radio that the State would pay 60 euros for a full pension to Andalusian hotels, and spas sustained in the low season are mentioned. For some participants, when the sector relies on public purchase, the picture of the terrace ceases to be an indicator and becomes a backdrop.

Civil servants, pensioners, and tourists: who sustains consumption

The pattern that repeats, according to several messages, is always the same: civil servants, maximum-pension pensioners, and tourists are the ones still spending money, while the rest tighten their belts. Some recall that in the previous crisis, the adjustment was made by devaluing workers' salaries by 30%, and that now, without room to devalue, the most unfair tax available is applied: inflation. This transfer—from current consumption to debt payment—is what has not yet fully reached the terraces, but has reached orders.

The general alert is set for January. Some anticipate that the climb will be like climbing a wall, with nearly six years of savings as the only safety net for some, and the feeling, more widespread than it seems, that the cycle has only just begun.