December 25, 2010 - Modern Distribution Management

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December 25, 2010

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6 Trends Driving Distribution in 2010

This article outlines and analyzes six trends MDM has identified as driving change in independent distribution channels over the past year and what that means for distributors going into 2011.

No question, the weak economic recovery has defined the past year in independent distribution channels. This has been nothing like the much stronger bounce-backs of yesteryear.

One of my favorite quotes from this year's articles in MDM was this: "The light at the end of the tunnel right now is not the proverbial oncoming train. We business owners are sleeping better these days." That was from Charles Gray, owner of industrial distributor Machinery and Factory Industrial Supply, Racine, WI.

Slow growth will define the next couple of years, according to the economists in MDM's recent 2011 economic forecast webcast. Still, many distributors did feel a …

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Commentary: Worst of Years, Best of Years?

Successful distribution companies have often defined themselves by the way they manage through business cycles, adjust and emerge with new growth strategies. This year has been such a pivot point. It started for many with no clear signs of recovery but is ending with positive signs for 2011.

For those of us who recall (or in my case have the ability to refer back to what I wrote), this past year has held some notable parallels to the early 1990s downturn. There were similar structural shifts in the way customers managed and in many cases reduced their MRO spend. Following that era, consolidation of distribution markets picked up.

With that history in mind, I offer two key areas to consider for the New Year, …

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ISM Semiannual Forecast: Recovery Will Continue

Economic growth in the U.S. will continue in 2011, say the nations purchasing and supply management executives in their December 2010 Semiannual Economic Forecast. Expectations are for a continuation of the economic recovery that began in mid-2009.

These projections are part of the forecast issued by the Business Survey Committee of the Institute for Supply Management.

Manufacturing Summary

Expectations for 2011 are positive as 65 percent of survey respondents expect revenues to be greater in 2011 than in 2010. The panel of purchasing and supply executives expects a 5.6 percent net increase in overall revenues for 2011, compared to a 7.9 percent increase reported for 2010.

Manufacturing purchasing and supply executives have expectations for continued …

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3M Returns Focus to R&D

For 3M, 2010 was a good year. Revenues surpassed pre-recession levels, with organic volume growth expected to be near 14 percent for the year. But even with all the positive news, executives at the diversified manufacturer see opportunity to do better.

At 3M's 2011 Outlook Meeting, George Buckley, president and CEO, addressed applauded the progress made on the strategic initiative introduced five years ago, but advised the company needs to stay on that path to continue strengthening its foundation going forward.

But the place any company should begin, Buckley advises, is with the core. "Unless the core is actually dead ... it's always the place where you're likely to get the …

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Why Industrial Distributor Oliver Van Horn Co. Sold to Wurth Group

This article analyzes Wurth Group's recent acquisition of industrial distributor Oliver H. Van Horn Co. The acquisition is Wurth's initial foray in the U.S. into the industrial supply category it classifies as the Metalworking Division.

The recent acquisition of industrial supply and machine tool distributor Oliver H. Van Horn Co. LLC, New Orleans, LA, by Germany-based Wurth Group is worth watching for a number of reasons.

A question asked by many in the industry familiar with the company is why this independent distributor sold to a German company.

The distributor has been owned and operated by the …

Why Industrial Distributor Oliver Van Horn Co. Sold to Wurth Group Read More »

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