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2Q14 MDM-Baird Distribution Survey: Return to Trend-Line Growth

2Q14 MDM-Baird Distribution Survey: Return to Trend-Line Growth

July 18, 2014

Second-quarter sales growth was slower than expected, according to respondents to the second-quarter 2014 MDM-Baird Distribution Survey. On average, overall growth was 3.5 percent, up from 2.2 percent in the first quarter.

Hoses & accessories companies were the strongest segment in the survey, with revenue gains of 6.7 percent. That segment’s growth contrasted with the PVF – water & sewer segment, which recorded the highest growth rates for the previous two quarters but fell to 2.3 percent growth in the second quarter. Safety companies and facilities maintenance (MRO) companies reported solid revenue growth of 5.8 percent and 5.2 percent, respectively.

Two sectors reported revenue declines in the second quarter, led by roofing companies (down 1.2 percent). Fasteners companies also saw revenue decline on average 0.1 percent as potential for overseas price increases remain expected for the third quarter.

Despite the slower-than-anticipated growth, respondents expect overall 2014 industry growth of 2.9 percent.

While PVF-water & sewer was repeatedly forecasting the highest gains during previous quarters, its growth expectation for the second half of 2014 is 1.4 percent, down from a 7.8 percent forecast in the first-quarter survey.

The mechanical/power transmission segment is predicting 7.5 percent revenue growth for the third quarter, and the plumbing segment expects 6.4 percent growth. Overall, the industry is seeing stable but slow growth in most sectors, with continued anticipation for further recovery from a challenging winter and previous years.

Many thanks to those who participated in this quarter’s survey!

The quarterly survey with Robert W. Baird & Co. included about 500 respondents in distribution (70 percent of respondents) and manufacturing in diverse sectors. The survey's goal is to gauge business trends and the outlook for the industry.

Read more about the results of the second-quarter 2014 survey, including results by sub-sector, in the July 25, 2014 issue of MDM Premium.

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