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In MDM's 2012 Wholesale Distribution M&A Update webcast, three industry experts, including representatives from investment banking, private equity and distribution, shed light on current trends in the industry. Merger and acquisition activity in distribution has bounced back, led by increasing middle-market transactions with predominantly strategic buyers.

Despite lower overall spending on transactions, merger and acquisition activity in the U.S. has made a comeback, according to Jason Kliewer, director of the distribution group for investment banking firm Robert W. Baird & Co. The U.S. M&A deal count has returned to near-2007 levels, driven in part by increasing middle-market transactions since 2009.

In distribution, activity has followed suit. M&A in 2010 reached “record levels, with deal count doubling from ...

The national media seems determined to make a return to recession an Olympic event. But let’s not give them the gold yet. Industrial markets have slowed, but there are still many niche areas of strength, and many distributors are reporting record-setting years. Financials of public distributors for the second quarter include high single-digit and double-digit growth. On a more macro basis, most expectations are for ...

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Now that the U.S. Supreme Court has upheld the Patient Protection and Affordable Care Act, businesses that have taken a “wait-and-see” approach to much of the law will have to take quick action to determine what they need to do to ensure they are in compliance. This article examines some of the key provisions of the PPACA and steps that businesses should be taking now.

In June, the U.S. Supreme Court upheld the Patient Protection and Affordable Care Act– commonly referred to as Obamacare – as constitutional, bringing to a close yet another chapter of the heated debate that has raged in Washington and across the country since the bill was passed in 2010. While some measures, such as the elimination of preexisting conditions for children and the extension of coverage for children to age 26, were already implemented, many more are slated to go into effect over the next 18 months.

But there’s a problem: The law contains so many provisions that it can be difficult for anyone to really understand what they need to do next. And misconceptions persist about what the law includes. In a recent MDM survey ...

The following is an excerpt of Brent Grover’s latest distribution management book, The Little Black Book of Strategic Planning for Distributors, published by Modern Distribution Management. In this article, Grover argues that the traditional method that distributors use to plan for the next year is flawed. Instead, they need to link the strategic plan to the annual planning process, and instead of working top-down, build from the bottom up. MDM subscribers get a 20 percent discount on this book.

General George S. Patton knew much about wartime planning and execution, and many of his aphorisms are memorable (“Lead me, follow me or get out of my way.”) and applicable to business situations (“A good plan violently executed now is better than the perfect plan next week.”).

To paraphrase: There are three ways that business leaders get what they want – by planning, by working and by praying. Any great business takes careful planning or thinking. Then you must have well-trained people to carry it out: That’s working. But between the plan and the operation there is always an unknown. That unknown


Overall U.S. construction in 2007 is forecast to slow from previous levels, thanks to a downturn in residential building, according to recent reports. But nonresidential construction should stay relatively strong in the new year, with institutional and commercial building leading the way.


McGraw-Hill Construction reports total construction starts will drop 1 percent in 2007. Housing starts will fall 5 percent, with both single and multifamily housing taking a hit.


A large backlog in unsold homes suggests home construction may be slow to turn around, but most analysts expect declines to moderate in 2007, according to the Fed. Housing demand may also improve in 2007.


McGraw-Hill reports that retail construction will decline as housing starts slow. Retail ...

MSC Industrial Direct Inc., Melville, NY, said in a recent conference call with investors that it has seen a slowdown in revenue growth in the past few months.


We're mindful of the ISM index and its historic correlation to our growth rate, CEO David Sandler said of the Institute for Supply Management's monthly manufacturing report. While we believe a number of marketing and sales initiatives will moderate its impact … it is apparent that three to six months of ISM weakness has modestly affected our revenue growth and will probably continue to do so in the next couple of quarters if past experience proves out."


Still, thanks in part to its acquisition of J & L Industrial Supply last year from Kennametal, the industrial MRO distributor recorded an increase in sales ...

Modern Distribution Management's November Inflation Index, which measures a cross-section of industrial supplies, was up 0.20% from the previous month, and up 4.04% from November 2005.

Summary of&nbsp ; MDM Inflation Index for the past 12 months:

November 2006 Index 266.5
October 2006 Index 265.9
September 2006 Index 265.6
August 2006 Index 265.2
July 2006 Index 264.0
June 2006 Index 263.0
May 2006 Index 262.1
April 2006 Index 262.1
March 2006 Index 262.1
Febuary 2006 Index 261.2
January 2006 Index 260.2
December 2005 Index 258.1
November 2005 Index&nbsp ; 256.1


Please click below on Related Document to view a detailed calculation of the&nbsp ; MDM Inflation Index for November 2006, listing the ten ...


Sales


November 2006 sales of merchant wholesalers, except manufacturers' sales branches and offices, after adjustment for seasonal variations and trading-day differences but not for price changes, were $331.3 billion, up 1.0% (+/-0.5%) from the revised October level and were up 7.9% (+/-1.2%) from the November 2005 level. The October preliminary estimate was revised upward $0.4 billion or 0.1%. November sales of durable goods increased 1.2% (+/-0.8%) from last month and were up 7.7% (+/-1.8%) from a year ago.&nbsp ;


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Compared to last month, sales of motor vehicle and motor vehicle parts and supplies were up 5.0% and sales of electrical and electronic goods increased 2.9 %. November sales of nondurable goods were up 0.7% (+/-0.7%) ...

November U.S. manufacturing technology consumption totaled $335.02 million, according to AMTDA, the American Machine Tool Distributors' Association, and AMT - The Association for Manufacturing Technology.


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This total, as reported by companies participating in the USMTC program, was down 12.3% from October, but up 32.7% from the total of $252.38 million reported for November 2005. With a year-to-date total of $3,549.90 million, 2006 was up 29.4% compared with 2005.


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These numbers and all data in this report are based on the totals of actual data reported by companies participating in the USMTC program.


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Though below the exceptional September peak, the November results continue to show strong purchases of advanced ...

Private label products—products branded by a wholesaler-distributor—represent a break from the more traditional wholesale distribution approach of reselling manufacturers' branded products. In our new research study, Facing the Forces of Change®: Lead the Way in the Supply Chain, we found that private label strategies by wholesaler-distributors will expand substantially over the next five years.

Private labels will strengthen wholesaler-distributors' relationships with their customers. However, they will strain distributors' relationships with their suppliers by challenging the wholesale distribution channel's traditional ...


Hype and speculation tend to follow an industry consolidator. The announcement last week that Home Depot CEO Bob Nardelli was ousted from his position over pay issues and lagging stock gains generated an inordinate amount of buzz. Some even claimed it is a repudiation of the Home Depot model itself and its relatively recent strategy to aggressively grow the wholesale distribution division.


Hardly. All we know versus a week ago is that HD has $210 million less to fund acquisition activities that instead went to Mr. Nardelli's severance package (Wouldn't you like to be chastised like that?). Now that will really slow the acquisition pace of HD Supply….


What's lost in the shock value of the pay deal is that Home Depot's net income in the most recent quarter, ended ...

1sourcesupplies is an alliance of distributors who want to offer single-sourcing programs to smaller customers, including inventory management, supply chain automation, streamlined billing and information analysis.


Mark Hill's cutting tool distributorship, I.M.C. Supply Co., Memphis, TN, lost its biggest customer in 1997. The customer we lost really wanted us to have their business, but we didn't have the programs they needed, Hill says.


Instead of folding, or scrambling to make ends meet, Hill pushed forward with a plan to find a way to offer single-sourcing solutions to his customers. Since that year, his business has doubled. About 65 percent of his business is now single-source.


Hill has decided to pass on his newfound knowledge in the form of a ...

Prices for manufactured goods in Canada remained unchanged for a second consecutive month in November, while prices for raw materials increased after three months of significant declines.


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Prices charged by manufacturers, as measured by the Industrial Product Price Index (IPPI), were unchanged from October to November, as downward pressure from declining petroleum prices eased. Lower prices for primary metal products and petroleum products were offset by higher prices for chemical products, fruit, vegetables and feed products and pulp and paper products.


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The 12-month change in the IPPI was up&nbsp ; 1.9%, a higher rate of growth compared to the year-over-year increase of&nbsp ; 1.2% in October. Upward pressure came mainly from higher ...

Construction spending during November 2006 was estimated at a seasonally adjusted annual rate of $1,184.1 billion, 0.2 percent below the revised October estimate of $1,186.7 billion. The November figure is 0.1 percent above the November 2005 estimate of $1,183.1 billion.


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During the first 11 months of this year, construction spending amounted to $1,110.5 billion, 5.4 percent above the $1,053.4 billion for the same period in 2005.


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Private Construction


Spending on private construction was at a seasonally adjusted annual rate of $905.8 billion, 0.6 percent below the revised October estimate of $911.0 billion. Residential construction was at a seasonally adjusted annual rate of $589.3 billion in November, 1.6 percent ...

Economic activity in the manufacturing sector expanded in December following a one-month decline, while the overall economy grew for the 62nd consecutive month, say the nation's supply executives in the latest Manufacturing ISM Report On Business.


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ISM reported that manufacturing proved resilient in December, as the PMI returned to growth registering 51.4 percent after a decline (under 50 percent) in November. Both New Orders and Production made significant gains to drive the PMI back above the breakeven point. Manufacturing employment remained relatively unchanged as the Employment Index shows a negligible change for the second consecutive month.


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The Prices Index is trending downward, relieving some of the inflationary pressure that ...

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