MDM-Baird 4Q11 Survey: Things Are Looking Up

Latest results show renewed sense of optimism from distributors and manufacturers for 2012.
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Results from the fourth quarter 2011 MDM-Baird survey, benchmarking revenues, pricing and gross margins across sectors, were a breath of fresh air. Gone was the cautious optimism of recent quarters. Many of the respondents were outwardly optimistic, with expectations that 2012 will be a year of growth for them.

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The results – compiled from more than 600 responses from distributors and manufacturers – showed fourth quarter 2011 overall was up on average 7.4 percent.

The greatest growth came from Pipes, Valves and Fittings distributors and manufacturers in the survey, which reported sales rose on average 14.2 percent in the fourth quarter. One segment saw revenues decline in the final quarter of the year – Janitorial/Sanitation, which saw a decrease of 1 percent. Other companies that saw flat or low growth were all serving construction markets.

Respondents on average expect growth to continue in the first quarter 2012, despite tougher comparisons, with a 4.5 percent increase. Revenues are expected to grow 4.6 percent overall in 2012.

Pricing was up 1.3 percent in the fourth quarter 2011 on average, and gross margins fell on average 40 basis points.

Inventory levels were consistent with expectations for moderate growth – in the first quarter 2012, about a third of respondents expect to increase inventories, with just 16 percent expecting to decrease.

Read the full results of the latest joint survey with Baird in the latest issue of MDM, out today.

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