December 10, 2010 - Modern Distribution Management

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December 10, 2010

Top Business Concerns in Reader Survey

MDM recently conducted its annual Reader Survey. On that survey, MDM asked questions about top business concerns for 2011 and what distributors, manufacturers and others have done to adapt to changing business conditions over the past two years. This article is a synopsis of those responses and provides insight into the mindset of the distribution industry as we move into the new year.

In the 2010 MDM Reader Survey, not surprisingly, the economic recovery and uncertainty that has accompanied it was one of the top three business concerns for many respondents.

Some readers are concerned the economy will decline again, while others are just not sure what's coming next for their markets – despite mostly positive …

Top Business Concerns in Reader Survey Read More »

Profitability in the Great Recession

In this article, Profit Planning Group's Al Bates illustrates how top companies across sectors were able to deliver strong profit results relative to their peers during the recession. He explains the four profit drivers that often are the differences between typical and high-profit firms, and with that data, he shows what typical companies can do to recession-proof their firms.

The so-called Great Recession created a unique set of financial challenges for distributors. In many lines of trade, sales didn't just decline, they fell precipitously. Overall, profits sank to the lowest point since distributor financial benchmarking was established in the 1970s.

Despite the challenges, a large number of firms continued to generate strong profits. A few even produced exceptional results. Understanding how they did that is essential …

Profitability in the Great Recession Read More »

Commentary: Spurt of Distribution M&A Deals Indicate a Rebounding Industry

MDM reported on a dozen announced acquisitions in the past month, and October was active, as well. It's interesting how diverse the deals are across sectors and size. Some companies are shedding units to focus on the core; some are buying market share, and others are extending product and service capabilities. Many companies are trying to get deals done before year-end. Credit markets are indeed improving, people are adjusting …

Commentary: Spurt of Distribution M&A Deals Indicate a Rebounding Industry Read More »

MSC Industrial’s Investment in Growth

Manufacturing production and new orders continued to expand in November, according to the latest Purchasing Managers Index, signs that the recovery is underway. But not every distributor has been able to take advantage of increased demand, says Erik Gershwind, COO of industrial distributor MSC Industrial Direct, Melville, NY. Gershwind recently presented at the Robert W. Baird Industrial Conference.

The cuts many "mom-and-pop" local and regional distributors have had to make put them in a precarious situation now that demand in increasing, Gershwind says. "They face severe pressure on working capital in the form of inventory and receivables," he says. "So many …

MSC Industrial’s Investment in Growth Read More »

Mergers & Acquisitions Set to Pick Up in 2011

Mergers & acquisitions activity has picked up in the fourth quarter of 2010 in wholesale distribution and manufacturing. And if a series of surveys out recently are any indication, pent-up demand for acquisitions will push consolidation on a global level to take off in 2011.

In the U.S., according to Robert W. Baird & Company's November global M&A report, there was a 22.7 percent increase in the number of transactions in October, and announced …

Mergers & Acquisitions Set to Pick Up in 2011 Read More »

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