Baird Survey: Industrial Distributors See Sales Drop in 4Q - Modern Distribution Management

Log In

Baird Survey: Industrial Distributors See Sales Drop in 4Q

The fourth quarter Baird Industrial Distribution Survey, from Robert W. Baird Inc., indicates the industrial economy is in recession.


On average, respondents' fourth quarter revenues were down significantly, with increased pricing offsetting unit volume declines. Expectations are for continued declines through 2009, though the trajectory should not be as severe as it was in recent weeks which were negatively impacted by abnormal holiday closures.
 
Baird's Industrial Distribution Research Team, led by senior research analyst David Manthey, CFA, collected feedback on fourth quarter results from nearly 300 independent and captive distributors with combined annual revenue in excess of $30 billion. Key survey findings include:


  • ...
Author
Date

The fourth quarter Baird Industrial Distribution Survey, from Robert W. Baird Inc., indicates the industrial economy is in recession.

On average, respondents’ fourth quarter revenues were down significantly, with increased pricing offsetting unit volume declines. Expectations are for continued declines through 2009, though the trajectory should not be as severe as it was in recent weeks which were negatively impacted by abnormal holiday closures.
 
Baird’s Industrial Distribution Research Team, led by senior research analyst David Manthey, CFA, collected feedback on fourth quarter results from nearly 300 independent and captive distributors with combined annual revenue in excess of $30 billion. Key survey findings include:

  •  Average revenues were down significantly in fourth quarter 2008 at -3.9% vs. essentially flat in 3Q08. Overall pricing remained positive, adding 1.1%, although down from 2.9% last quarter.
  • Six-month outlook is for continued declines in the first half of 2009 with an expectation of -3.6%.
  • Respondents are anticipating moderating declines in second half of 2009 with an overall 2009 revenue expectation of -2.3% implying -1% in second half of 2009.
  • Abnormal holiday closures added to December/January weakness, with 57% of respondents indicating some level of closures over the recent holiday weeks.
  • Areas of strength: Over the next six months, growth is only expected by distributors of Rental Equipment with the most severe declines expected by distributors of datacomm products, fasteners and roofing/building Materials. The most promising end markets include wholesale trade, general contractors and chemical.

Respondents also reported that inventory decreased with revenue, but is to some extent seasonal. In addition, 73% of respondents reported seeing the effects of the credit crisis vs. 54% last quarter.

Share this article

About the Author
Recommended Reading
Leave a Reply

Leave a Comment

Sign Up for the MDM Update Newsletter

The MDM update newsletter is your best source for news and trends in the wholesale distribution industry.

Get the MDM Update Newsletter

Wholesale distribution news and trends delivered right to your inbox.

Sign-up for our free newsletter and get:

  • Up-to-date news in a quick-to-read format
  • Free access to webcasts, podcasts and live events
  • Exclusive whitepapers, research and reports
  • And more!

2

articles left

Want more Premium content from MDM?

Subscribe today and get:

  • New issues twice each month
  • Unlimited access to mdm.com, including 10+ years of archived data
  • Current trends analysis, market data and economic updates
  • Discounts on select store products and events

Subscribe to continue reading

MDM Premium Subscribers get:

  • Unlimited access to MDM.com
  • 1 year digital subscription, with new issues twice a month
  • Trends analysis, market data and quarterly economic updates
  • Deals on select store products and events

1

article
left

You have one free article remaining

Subscribe to MDM Premium to get unlimited access. Your subscription includes:

  • Two new issues a month
  • Access to 10+ years of archived data on mdm.com
  • Quarterly economic updates, trends analysis and market data
  • Store and event discounts

To continue reading, you must be an MDM Premium subscriber.

Join other distribution executives who use MDM Premium to optimize their business. Our insights and analysis help you enter the right new markets, turbocharge your sales and marketing efforts, identify business partners that help you scale, and stay ahead of your competitors.

Register for full access

By providing your email, you agree to receive announcements from us and our partners for our newsletter, events, surveys, and partner resources per MDM Terms & Conditions. You can withdraw consent at any time.

Learn More about Custom Reports

Request a Market Prospector Demo

  • This field is for validation purposes and should be left unchanged.