Rexel Hires an Arrow … Brian McNally Moving from Electronics to Electrical


Last week brought news that Rexel has hired Brian McNally (click here for his LinkedIn profile) to be EVP and President of Rexel North America. Brian breaks recent history of electrical veterans running Rexel North America / US (Dick Waterman, Chris Hartmann) as he comes from Arrow Electronics.

Now, we don’t know Brian and we do wish him the best.  We do have some thoughts …

And at times, going outside of the industry can bring new ideas that can help “jump start” a company and take it to the next level.

Having done some work in the electronics space and from conversations with some manufacturers who sell to distributors in that industry, the following are some differences that Brian will need to consider.  Perhaps Rexel wants to emulate some Arrow strategies as the profile of Rexel’s US customer base does not appear to overly mirror Arrow’s customer base (Rexel’s annual reports typically refer to the contractor customer for US operations even though they have a number of Rockwell APRs).

  • Arrow is a $21+ billion international distributor with possibly 40-50% in the US.  It’s margins are a little slimmer than Rexel coming in around 15-20% in the US.
  • The electronics distribution market is more consolidated than the US electrical market (today).
  • Typically electronics distributors work more with OEMs, either directly or through contractors. The sales are typically large dollar for a quarter or a year at a time with JIT inventory commitments. Bidding is the norm. Whereas the electrical market is more project-driven or “parts and pieces” for fulfilling small orders (i.e. counter traffic, deliveries from inventory).  As one person said, electronics is about “assembled” material whereas electrical is about “installed” material.  Essentially there is no contractor dynamic that drives Arrow’s business other than that the OEM has selected them to be the “fulfillment” source.
  • Some electrical manufacturers, albeit on the electronic side of their business, that Arrow also does business with include: Bussmann, Dialight, Littelfuse, Molex, Sylvania, Panduit, Panasonic, Samsung LED and a few others whose interconnect or electronic divisions do business with Arrow.  In other words, perhaps not much exposure to electrical manufacturers.
  • Manufacturer reps are important in the electronics world as they drive the specification process.
  • Many accounts tend to be global in nature.
  • In the words of another manufacturer, the product offering tends to be “deep, not broad” and that selling in this market involves “volume”.

Given the differences in the customer base, supplier base, go to market strategies … coupled with the transition that Rexel has been undergoing with personnel, cost-management, ERP strategy, it’s operational model, et al, we presume that there will need to be a transitional phase to think about how to best address the contractor market (since contractors represent 45-55%, if not slightly more, of the US electrical market.  Hopefully Brian will be able to benefit from Chris’ extensive electrical experience during the transition.

We wish Brian well.

Facebooktwittergoogle_plusredditlinkedinby feather
The following two tabs change content below.
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."