This is a part of the 2017 Distribution Trends Special Issue. The annual feature was researched and written by MDM based on interviews with dozens of distributors, industry experts and manufacturers. MDM also conducted a survey of its readers to uncover the trends outlined in this issue.
2017 Distribution Trends Special Issue
Competition for customers increasing. Safety products, particularly personal protective equipment, has been a target growth area for many distributors in other sectors. For example, Grainger has been investing heavily in expanding its Shoe Mobile service that provides safety shoes to manufacturing and health care customers at their facilities. It's primarily a move to increase wallet share from existing customers by providing products that everyone needs and that are often perceived as commodities. And expansion into this area isn't expected to slow any time soon.
Increased competition translates to increased focus on consultative services. As more non-specialist distributors expand their safety product offerings, specialists are focusing on ways to provide more service and training. "If a company has X dollars to invest in safety, a higher and higher proportion of it is going to nontraditional areas," says Bruce Levitt, president, Levitt-Safety Ltd, Oakville, ON. "There seems to be a growing trend to training software consulting versus the PPE side."
Infrastructure opportunities grow, even without a federal infrastructure funding bill. Construction markets was identified as one of the top target markets for growth by safety distributors and manufacturers in the 2017 MDM market trends survey. While hopes are high for federal funding, activity is already starting to pick up in some geographic areas.
Oil & gas turns a corner, and safety distributors see opportunity. With the rig count in the U.S. rising and drilling activity picking up overall, safety distributors are reopening the doors to this end-user segment as a growth target. "(We're seeing a) revival of the oil and gas industry," noted one survey respondent, which makes it an attractive market once again.
Merger & acquisition highlights in 2016:
Mallory Safety and Supply, Portland, OR, acquired RJ Safety Supply Co., San Diego, CA.
Ritz Safety LLC, Dayton, Ohio, acquired Slate Rock Safety LLC, Medina, OH, an e-commerce retailer and distributor of flame resistant work apparel and other personal protective equipment. Ritz also acquired Public Works Supply, Portland, OR.
S.P. Richards Co., the office products group of Genuine Parts Co., Atlanta, GA, agreed to acquire The Safety Zone LLC, Guilford, CT.