The 2020 Mid-Year Economic Update_long

2014 Trends Snapshot: Industrial Distribution

This article is part of MDM's 2014 Distribution Trends Report. It provides a quick look at key trends affecting the industrial distribution sector.

The annual report was researched and written by MDM editors based on interviews with dozens of wholesaler-distributors, as well as industry experts and manufacturers. MDM also conducted a survey of its readers to uncover the trends outlined in this report.

The full report is available to download in PDF format to MDM Premium subscribers. Subscribe below for full access. Or log-in if you are already a subscriber.

Trends outlined in the 2014 report include:

  • Leaving Economic Uncertainty Behind
  • Connecting the Dots Online and Offline
  • Need for Access Whenever, Wherever, However Drives Mobile Adoption
  • Avoiding Information Overload Essential with Analytics
  • Making the Case for Millennials in Distribution
  • Training, Technology Take Front Seat in Employee Retention Strategies
  • Better Inventory Management Through Data, Collaboration
  • Distributors Seek More Complete Strategy for Vending
  • Private Equity Consolidating Markets
  • A More Practical Approach to Product Expansion
  • Other Trends
  • Trend Snapshots for 13 Sectors

The report also includes the following case studies and interviews:

  • 2014 MDM Market Movers
    • Engman-Taylors Cost-Saving Teams
    • Capitol Coffees Proactive Problem-Solving
    • Redwood Plastics Online Success Story
  • MDM Market Leader Profiles
    • DGI Supply: Building on the Core
    • F.W. Webb Takes Diverse View of Market

This is a part of the 2014 Distribution Trends Report. The annual report was researched and written by MDM editors based on interviews with dozens of wholesaler-distributors, as well as industry experts and manufacturers. MDM also conducted a survey of its readers to uncover the trends outlined in this report.


2014 Distribution Trends Report


Online-only competition seems to have heated up in the past year, with concerns over Amazon’s place in the B-to-B market and the largest distributors’ growing investments in their e-commerce and mobile platforms. As a result, many distributors are taking the plunge and upgrading their websites to move toward a full e-business experience with suppliers and customers.

Challenges with vending profitability continue, after a burst of activity over the past few years. Some industry-watchers say that distributors, including some of the largest, are pulling back from the aggressive sales approach they had been pursuing. But customers continue to ask for the services, and despite these challenges, vending and other inventory management services continue to be key growth drivers in the industrial distribution sector.

In the years immediately following the recession, we saw an increasing number of distributors diversifying their product mixes as part of a strategy to insulate themselves against future downturns. Now, we’re seeing some distributors pull back or at least take a more conservative approach to product mix expansion, with a harder look at the potential payback they may get from the investment. The challenges include profitability of new lines and the ability to dedicate resources to grow those product categories.

The distribution mergers & acquisitions market is expected to be stronger in the second half of 2014, with large and regional industrial distributors pursuing strategic acquisitions for product, service and geographic expansion.

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