With the uptick in acquisition activity we saw in 2011, the potential impact of consolidation continues to be a concern for distributors and manufacturers. The issue was one of four featured in the latest MDM Executive Briefing on Key Trends and Issues in Wholesale Distribution for 2011-2012.

We Deliver Distribution News to Your Inbox Sign up below to receive MDM Update, your free weekly distribution news update by email.

At the heart of the concern for many distributors is the reassessment by manufacturers of how they use their distribution partners as channels continue to consolidate.

\”It seems to me in our industry there is almost a great reckoning going on,\” says Julia Klein, president and CEO of C.H. Briggs Company, a specialty building materials distributor based in Reading, PA. Manufacturers are looking to realign themselves with \”survivors,\” she says, and find \”safe havens\” to move forward with.

Ted Cowie, executive vice president of Elvex, a manufacturer/importer of safety products, agrees. \”Manufacturers may have less desire to have a broader base of distribution customers,\” he says. They may streamline how they go to market by consolidating business to larger distributors.

But at the same time, consolidation is opening some new opportunities for small and mid-sized distributors who may be able to pick up lines from manufacturers that don’t want to \”cohabitate\” with competitors when a distributor partner merges with another distributor, says Kevin Boyle, president of Industrial Distribution Consulting LLC.

Click on the video below to hear more on consolidation from the December 2011 Executive Briefing. Or, view the entire episode at mdm.com/executivebriefing.