Sales Continue to Slide for some Electrical Distributors


Most everyone in the electrical distribution channel understands that residential sales have fallen through the floor or are in the ditch.
To understand currently what is happening, Allen Ray Associates started an“Informal” phone survey to 27 distributors (at this point). They vary in size from $7M up to over a $100M. The point of the phone survey was to verify what we had been hearing from networking groups, which is that for some, the decrease in sales continues.
The problem for some distributors their overall sales are continuing to fall.
With 2008 / 2009’s drop in sales the decrease appears to be spottier in certain locations. While this phone survey is not a full blown, pull out all the stops type research project, it does give an indication that a further drop in sales is more specific in nature. Further it is not confined to just residential.
Flash forward to now and many of these same distributors are saying that their Jan and Feb sales are off an additional 9-18% YTD vs 2009 sales. This is significant because now the new benchmark after all the dust settles will probably be lower than 2008 sales for many distributors if it continues to slide.What this really means to some, is that the new “new” may be 2007 sales or even further back than that. In certain markets it speaks to further market shrinkage and over capacity (too much product availability and too many distributors in a given market place).
What do you see in your market place?

These are unusual times in that small businesses are frozen out of the credit market and really big companies are flush with cash and no real market to sell to……yes I understand there is some market there. But how do you tap into it?

We would be interested to here how you are reacting to your market place. Drop us an email (Allen, David) or post your thoughts.

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Supporting manufacturers, distributors and others in the electrical channel with accelerating growth through business / channel strategy, marketing development and customer-focused market research. We generate "ideas that deliver results."

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