Who’s Next Within North America’s Electrical Distributor Channel?
I was reviewing my ever overflowing data files and came across an article that John Kerr and I had written a few years ago, entitled “View from the North.”We were comparing major differences between the Canadian and American distribution channels.
One of the most interesting comparisons was how the top five distributors in the United States compared to the top five distributors in Canada. To my surprise, the top 5 U.S. distributors controlled around 28% to 33% of total sales in the US. In 2008, the U.S distributors represented around 18-21% of the total market. Bottom line: the big international and national/regional distributors got bigger (10-12% growth).
In Canada, we saw growth almost identical to what was occurring in the United States. In 2009, we calculated around 65% of total sales were controlled by the to the top 5 distributors. Today, the top 5 international and national/regional distributors represents 73-78% of total Canadian sales.
In both countries, the larger distributors are acquiring smaller regional/independent distributors at an ever faster rate.
Within this competitive community, large international and independent distributors have competed with some balance. However, considering the latest figures, who will be the next acquisition, and which of the international distributors will take the #1 position in 2015?
Which brings me to the real question. Who is next?
No one has the answer, but I willing to wager that this will happen at a faster rate in 2015 that we have ever seen in the past.
Read more from Paul Eitmant in CEW:
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– How Healthy is Your Business?
– Social Media: Is It the Future for the Electrical Industry?
– Customer Service: A Key to Success
– The Right Price to Get the Order — the Last Look
– The Good Old Boys Club “Changing of the Guard”
– Generation Y – Next Generation – Never to old to Learn!
– LEDs: the Fastest Growing Product/Market for 2015
Paul Eitmant is President and CEO of IP Group International, which serves the needs of business-to-business enterprises in over 30 countries worldwide by adding specialized expertise to the business planning and implementation process; Tel: 480.488.5646; paulipgroup@cox.net.
