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Economic Trends

MDM Forecast: May 2025 Update

The latest MDM Forecast reflects an overall downward revision in 2025 revenue expectations in the wake of tariff impacts, though still in line with the industry’s historical average. As always, results vary across the 19 industry sectors tracked by the U.S. Census Bureau. Get your sector-specific insights here.

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Electrical

ADI Global Distribution: A Success Story of Product Mix and Acquisitive Growth

Featured Premium

Distribution Center, Warehouse Metrics Reveal Size-Based Demand

Mergers & Acquisitions

April M&A Roundup: Another Sluggish Month Illustrates PE’s Hesitation

Quarterly MDM-Baird Distribution Survey

Research: Distributors & Manufacturers Split on Signs of Pullback, CapEx Plans

Tariffs

Distributors Forecast Shaky 1-10% COGS Increase with Tariffs Influence

Tariffs

How Are Distributors Combatting Higher Costs from Tariffs? Here’s What They Told Us

Economic Trends

MDM Forecast: April 2025 Update

Mergers & Acquisitions

QXO Confirms Plans to Rebrand Beacon

Tariffs

A Few Words on Elasticity, the Future of Tariffs and Distributors’ Response

ECONOMIC OUTLOOK REPORTS

MDM 1Q25 Forecast Report

This comprehensive MDM 1Q25 Forecast is a guide to the industrial economy for wholesale distribution executives, providing a historical, current and future snapshot of numerous key economic indicators in one convenient place.

2024 Annual MDM Economic Outlook

Our 2024 EOR is a comprehensive economic reference guide to the U.S. wholesale distribution industry and its many different verticals. It is comprised of 20 different subreports.

Premium Monthly

MDM April 2025 Premium Monthly

This mega-issue’s content is packed with a wealth of MDM Research on how tariffs are impacting distributors’ cost of goods sold, investment plans and what they’re doing about it; and the return of MDM’s Women in Distribution feature.

Market Insight Reports

MDM 1Q25 MarketPulse Report

MDM’s 1Q25 MarketPulse Report consists of the quarterly results, analysis and commentary from the Baird-MDM Industrial Distribution Survey that explored revenue performance, pricing and expectations for the current quarter and rest-of-year.

MDM 1Q25 M&A Report

See our new breakdown of M&A activity by product category, the latest EBITDA trading multiples for 30 top industrial distributors, and our detailed recap of dealmaking activity during January-March, which was notably subdued compared to previous quarters.

Case Studies

MDM Case Study: MSC Industrial Supply

The metalworking and MRO supplies distributor has successfully transitioned from a catalog-driven product house that relied on spot-buys to its role today as a digitally-driven, “Mission Critical” company. Here’s how.

MDM Case Study: Watsco

Watsco has achieved a marketing-leading position in HVACR distribution through a combination of deep supplier partnerships, a buy-and-build philosophy and a technology-first mindset. We examine the company’s recent evolution and where it’s going.

Companies

WESCO 2006 Sales Up 20.3%

WESCO International Inc., Pittsburgh, PA, reports sales increased 20.3% to $5.32 billion, compared with $4.4 billion in 2005. Profit for the year was $217 million, double the profit of last year.

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The electrical distributor reported sales of $1.37 billion for the fourth quarter 2006, an increase of 11.3% over the same period last year. Profit was $58 million versus $40 million in the prior-year quarter.

More Breaking …

Companies

3M Acquires Rite-Lok Adhesives Line

3M, St. Paul, MN, has acquired the Rite-Lok global industrial adhesives product line from Chemence Inc., a specialty chemical company that manufactures consumer and industrial adhesives.

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The line includes anaerobic threadlockers, retaining compounds, gasket makers, thread sealants, structural adhesives, and specialty cyanoacrylate instant adhesives for industrial use such as metal bonding, plastics and rubber. The line also includes high-temperature, low-odor industrial adhesives and rubber-toughened flexible adhesives.

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More Breaking …

Companies

Anixter Grows Sales to $4.94B in 2006

Anixter International Inc., Glenview, IL, distributor of communication products, electrical and electronic wire & cable and fasteners, reported sales of $4.94 billion in the year ended Dec. 29, 2006, up from $3.85 billion last year. Profit was $209.3 million in 2006.

Sales in 2006 were boosted by the acquisition of Infast in July 2005, IMS in May 2006 and MFU in October 2006.

Sales in the fourth quarter were $1.3 billion, including $23.5 million from acquisitions. Sales were up 27% from the same period a year ago. Profit increased 160% to $52.4 million. Organic growth was 22% in the fourth quarter.

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Anixter reported it saw strong large-project business, related to data center builds in the enterprise cabling market and energy and natural …

Economic Trends

ISM: Manufacturing Contracts in January

Economic activity in the manufacturing sector contracted in January after a one-month expansion, while the overall economy grew for the 63^rd month, according to the latest manufacturing ISM Report on Business.

After a slight rebound in December, the manufacturing sector did not grow in January. New Orders remained positive, but little change has taken place as the PMI has averaged 50.5% in the past four months. In overall terms, manufacturing lost momentum in the second half of 2006 and is starting 2007 in a less than robust fashion, according to the Institute for Supply Management.

Results show a decline in the Inventories Index to the lowest level since February 2002, indicating a significant liquidation is taking place in many supply chains. …

Free

Danaher Sales Grow 20% in 2006

Danaher Corporation, Washington, D.C., reported sales for 2006 were $9.5 billion compared to $7.98 billion in 2005, an increase of 20%. Profit was $1.1 billion for fiscal 2006, up 25% over last year.

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Sales in the fourth quarter was $2.6 billion, an increase of 17.5% from fourth quarter 2005. Profit for the fourth quarter was $323.7 million, a 28.5% increase.

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The company also announced it has expanded its reporting to four segments. The four segments are Medical Technologies, Professional Instrumentation, Industrial Technologies and Tools and Components. The Medical Technologies business, previously included within the Professional Instrumentation segment, will now stand alone as its own reporting segment. Professional …

Companies

Grainger Sales Up 6% to $5.9B in 2006

W.W. Grainger reported sales of $5.9 billion for fiscal 2006, up 6% versus 2005, and 7% on a daily basis. Profit for the year increased 11% to $383 million, as compared with $346 million in 2005.

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Sales in the fourth quarter were $1.5 billion, up 5% from the prior-year fourth quarter. Daily sales increased 5% in October, 6% in November and 5% in December. Income was $99 million, down 5% from last year.

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In 2006, Grainger installed SAP across most of the U.S. branch-based business.

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Branch-Based Segment
Sales in this segment in the U.S., Mexico and China, increased 5% in the fourth quarter. Of the 5% growth, an estimated 3 percentage points came from the company’s two growth initiatives in the U.S., market …

Subscriber Only

MDM January 25, 2007

This is the pdf of this issue of Modern Distribution Management. Apply the full $24.95 pay-per-view cost toward an annual subscription (within 30 days of purchase), which includes two issues a month plus access to more than six years of online archives and market data. Call 1-888-742-5060 or email [email protected] to …

Management

Case Study: Preempting Problems

Company Snapshot

One distribution center and five branches, based in Livonia, MI.
Number of employees: 58
Key products: Bearings and power transmission

We strive to be problem-solvers in the marketplace by providing end-user training. It's a service the customer values and one that our competition can't easily duplicate. It adds real value to what we offer and helps us build stronger relationships with our end users.

More than eight years ago we began receiving requests from customers for maintenance-related training. We viewed these requests as opportunities for us to grow our business.

We sat down with those customers to determine the specific areas where they needed …

Companies

Letter to the Editor: What’s Home Depot’s Growth Strategy?

Dear Editor:

I would like to disagree with MDM’s editorial on Home Depot (MDM Jan. 10, 2007) – on several levels.

1) The job of company management, within certain limits, is to maximize shareholder value. HD stock was over $43 in 2000. According to the inflation calculator provided (on the Web) by the Bureau of Labor Statistics, that adjusts (for inflation) to about $50 in 2006. I would guess it will adjust another dollar higher in 2007 money, so make it $51.

Essentially, HD paid Bob Nardelli more than $450 million over six years to go backwards. The spending power of the money invested in HD stock by shareholders who bought the stock the day he was named Big Cheese DECLINED. You cite Nardelli’s accomplishments. If he’s not responsible for …

Economic Trends

Monthly Wholesale Trade: November 2006

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% from the revised October level and were up 7.9% from the November 2005 level. November sales of durable goods increased 1.2% from last month and were up 7.7% from a year ago. 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%) …

Economic Trends

Commentary: Don’t Look in the Rear-View Mirror

As the lead article in this issue illustrates, the inflation threat largely driven in 2005 by energy price hikes has moderated, particularly the last few months of the year. Wholesale prices rose 1.1 percent in 2006, compared to 5.4 percent in 2005. But wholesale prices except food and energy – the core inflation rate – moved up 2 percent in 2006 following a 1.4 percent gain in 2005.

Distributors need to look more closely at the stats in their own sectors, as there are a lot of mixed signals. Materials for durable manufacturing increased 13 percent in 2006; prices for materials/components for construction increased 4.3 percent.

But as these pages pointed out (Adam Fein article in Nov. 10, 2006 MDM), distributors really need to watch steroid revenue growth produced …

Free

MDM News Digest 3702

Apollo Management, which also recently invested in Rexnord, has made an investment in Bradco Supply Corp., a roofing distributor based in Avenel, NJ. Bradco has more than 150 branches in the U.S. Bradco founder Barry Segal says the investment is a great opportunity to significantly grow the company.” More …

Global fastener distributor The Wurth Group, based in Germany, recorded 12 percent sales growth in fiscal 2006 to 7.74 billion euro, or US$9.9 billion. Outside of Germany, sales increased by 11.8 percent to 4.62 billion euro, or US$5.96 billion. Profit grew by 16.5 percent overall. <a href="/pub/1_1/breaking-news/3616-1.html" ...

Economic Trends

Inflation Softens in 2006

Click here for charts showing inflation by product group – 16 products, including tools, fasteners, machinery/equipment, fluid power, and others, are displayed in this document.

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This is an overview of wholesale price inflation trends in the past year for commodities in industrial and construction channels. Overall, core inflation rose 1.1 percent in 2006 -a significant slowdown from 2005. But the Federal Reserve still sees inflation as a potential threat in the next year, albeit at lower levels.

Thanks to a slowdown in energy price increases, wholesale prices rose 1.1 percent in 2006, in contrast to the 5.4 percent rise in 2005, the Bureau of …

Economic Trends

Distribution Financial Metrics and Trading Multiples

This table highlights key financial metrics and trading multiples for 30 publicly traded distributors in the industrial and building products industries. Download the pdf in this article to see the data. Also find graphic illustrating median EBIDTA multiples for the same distribution companies.

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These materials,&nbsp ; prepared by Robert W. Baird & Co. for MDM are for informational purposes …

Companies

Praxair Sales Up 10% in 2006

Industrial gases producer and distributor Praxair, Inc., Danbury, CT, reported sales of $8.3 billion for 2006, an increase of 10% over last year. In North America, sales reached $4.6 billion for the year, up 9%.

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Sales in the fourth quarter were $2.123 billion, up 9% from the same period a year ago. In North America, fourth-quarter sales hit $1.182 billion, up 6%.

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Praxair achieved strong growth from new business and the start-up of new supply systems in every geography and end market.

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Sales growth occurred in most major end markets and the company completed seven major projects in 2006. Additionally, the number of new projects underway and set to come on stream in the next several years increased significantly …

Companies

Praxair to Acquire Mittler Supply of Indiana

Praxair Distribution, Inc., Danbury, CT, a subsidiary of Praxair, Inc., has agreed to buy Mittler Supply Inc., distributor of industrial, medical, specialty gases and related welding equipment and supplies, operating in Indiana, Michigan and Illinois. Mittler had sales of $73 million in 2006 and has 210 employees.

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Founded in 1946, Mittler operates a cylinder-gas fill plant, specialty-gas laboratory and a centralized warehouse for distribution of welding equipment and supplies at its headquarters located in South Bend, IN. The firm also operates several satellite cylinder-gas fill plants and 18 retail sales and distribution locations in the three states.

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“The addition of Mittler Supply to our existing network in the Great Lakes …

Free

Kennametal Sales in First 6 Months Unchanged

Kennametal Inc., Latrobe, PA, reported sales for the first six months of fiscal 2007 were $1.1 billion, level with the same period last year. Sales grew 6% on an organic basis, offset by the impact of acquisitions and divestiture of J & L Industrial Supply.

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Sales for the quarter were $569 million compared with $563 million in the same quarter last year. Sales grew 6% on an organic basis.

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Metalworking Solutions & Services Group sales were up 5%, led by year-over-year expansion in the distribution, aerospace and general engineering markets. The North American market continued to moderate (+1%), while conditions in the European market continued to improve (+11%), and Asia Pacific (+6%) and India (+7%) delivered solid growth.

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Companies

Applied Industrial President to Retire in December

Applied Industrial Technologies announced that Bill L. Purser, president and COO, will retire effective Dec. 31, 2007. Purser, 63, has been president since October 2000.

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Ben J. Mondics, 48, will be promoted to president following Purser’s departure. Mondics, effective Feb. 1, will be promoted to COO.

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Mondics is currently Applied’s Area Vice President – Midwest Area, where he oversees nine regions and 86 service centers in 11 states. The Midwest sales area is the largest of the company’s five geographic divisions. Mondics has been with Applied since 1994.

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More Breaking …

Building Materials/Construction

Building Products Distributor BlueLinx Sales Fall in 4Q

BlueLinx Holdings Inc., Atlanta, GA, distributor of building products, reported revenue for the fourth quarter 2006 declined about 29% to $945 million from the same period a year ago. The company’s business that is tied to new home construction was negatively impacted by the slowdown and depressed wood-based structural product prices. BlueLinx reported a net loss for the quarter.

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The company’s fourth-quarter results historically are affected negatively by a seasonal slowdown in construction. It also had a stronger-than-expected 2005 fourth quarter in the aftermath of Hurricanes Katrina and Rita.

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The company’s overall unit volume fell about 17% during the fourth quarter, with structural unit volume down about 18%, and specialty unit …

Building Materials/Construction

Illinois Tool Works Sells Roofing Business to OMG

Illinois Tool Works Inc. has sold its mechanical roofing fastener business for $26 million to OMG Inc., a subsidiary of Handy & Harman.

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The business develops and manufactures fastening systems for the commercial roofing industry.

OMG is a manufacturer of mechanical fasteners, accessories and components and building products for the commercial and residential construction industry.

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More Breaking …

Investment Banking Directory

Work with a banking partner that knows your business. Get detailed information on investment banks with expertise in the wholesale distribution industry.

Building Contractor Loyalty

This multi-month research effort includes surveys, interviews, extensive publication scanning, and deep synthesis to…

In Pursuit of Practicality: 52 real use cases for AI in wholesale distribution today

This multi-month research effort includes surveys, interviews, extensive publication scanning, and deep synthesis to…

Essential Financial KPIs – Unlock the Power of Financial Metrics

This new guide from MDM provides real-world examples from companies that recently innovated on…

MDM Guide: Tailor Your Tech Strategy to Win in Any Market

This new guide from MDM provides real-world examples from companies that recently innovated on…

Market Prospector

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MDM Forecast: May 2025 Update

ADI Global Distribution: A Success Story of Product Mix and Acquisitive Growth

Distribution Center, Warehouse Metrics Reveal Size-Based Demand

April M&A Roundup: Another Sluggish Month Illustrates PE’s Hesitation

Research: Distributors & Manufacturers Split on Signs of Pullback, CapEx Plans

Distributors Forecast Shaky 1-10% COGS Increase with Tariffs Influence

How Are Distributors Combatting Higher Costs from Tariffs? Here’s What They Told Us

MDM Forecast: April 2025 Update

QXO Confirms Plans to Rebrand Beacon

A Few Words on Elasticity, the Future of Tariffs and Distributors’ Response

ECONOMIC OUTLOOK REPORTS

MDM 1Q25 Forecast Report

2024 Annual MDM Economic Outlook

Premium Monthly

MDM April 2025 Premium Monthly

Market Insight Reports

MDM 1Q25 MarketPulse Report

MDM 1Q25 M&A Report

Case Studies

MDM Case Study: MSC Industrial Supply

MDM Case Study: Watsco

Investment Banking Directory

Building Contractor Loyalty

In Pursuit of Practicality: 52 real use cases for AI in wholesale distribution today

Essential Financial KPIs – Unlock the Power of Financial Metrics

MDM Guide: Tailor Your Tech Strategy to Win in Any Market

Market Prospector

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