EW’s Top 200 Report Sales Upswing

June 11, 2004
After a couple of shaky sales years for the electrical industry’s 200 largest electrical distributors, 2003 proved to be a stabilizing year, according to Electrical Wholesaling’s annual Top 200 analysis, which appears in this month’s issue of the magazine. Those electrical distributors that reported sales volume for both 2002 and 2003 increased annual sales an average of 1.8 percent, bringing total sales for the Top 200 up to an estimated $35.2 billion for 2003.

After a couple of shaky sales years for the electrical industry’s 200 largest electrical distributors, 2003 proved to be a stabilizing year, according to Electrical Wholesaling’s annual Top 200 analysis, which appears in this month’s issue of the magazine. Those electrical distributors that reported sales volume for both 2002 and 2003 increased annual sales an average of 1.8 percent, bringing total sales for the Top 200 up to an estimated $35.2 billion for 2003.

Of course, that’s just the average. A better gauge of the electrical industry’s health might be obtained by looking at the number of electrical distributors reporting increases, decreases and flat sales. Among the electrical distributors on the Top 200 list that provided a sales number for both 2002 and 2003, 67 percent reported a sales increase, 25 percent reported a decrease, and 8 percent reported flat sales.

Those statistics are more optimistic than the previous two years’ stats. For 2002, 45 percent saw an increase in sales, 50 percent saw a decrease, and 5 percent reported flat sales. For 2001, the results were even more dismal with only 35 percent reporting increased sales, 56 percent with decreased sales, and 9 percent with flat sales.

For 2003, the sales increases and decreases among Top 200 electrical distributors span a wide gap. When looking at individual wholesaler’s actual sales, revenues were down as much as 22 percent and up as much as 57 percent.

Dallas’ The Reynolds Co., with sales up 57 percent in 2003, has grown significantly the last few years through its acquisition of eight Warren Electric branches as well as by consolidating existing branches and opening others in new markets. For 2004, the company expects a 10 percent increase.

The Reynolds Co. isn’t alone in its call for continued growth. Other distributors predict healthy 2004 sales growth fueled by the recovering economy, by growing market share, through acquisition, by opening new branches and through operation improvements. More than one distributor executive indicated some of an upsurge would be due to steel and commodity price increases, which will be passed on to customers.

Based on 2003 total electrical sales estimates of $73.96 billion, the Top 200 electrical wholesalers command 48 percent of the industry’s available market share.

The Top 200 electrical distributors employ an estimated 76,779 people at approximately 4,427 locations. Those numbers are both up from 2002 estimates of 76,751 employees and 4,380 locations.

Based on the 133 distributors that furnished both a sales volume and an employee count for the current list, the average sales per employee came in at $469,536, which is down slightly from last year’s $472,167.

Market share of the electrical industry’s four full-line national chains — Graybar Electric, WESCO Electric, Consolidated Electrical Distributors (CED) and GE Supply — didn’t change dramatically. With combined 2003 sales of $11.9 billion, their collective market share is 16.1 percent compared with 16.9 percent for 2002. That makes two years in a row the four national chains have lost market share. From 1995 through 2001, the four chains steadily grew market share, peaking in 2001 with 18 percent.

Although merger and acquisition activity has definitely slowed, two electrical distributors appearing on the current list have been acquired in 2004. Mayer Electric Supply Co. Inc. (No. 18), Birmingham, Ala., acquired Maddux Supply Co. (No. 50), Greensboro, N.C., in February. Crescent Electric Supply Co. (No. 11), East Dubuque, Ill., acquired Peerless Electric Supply (No. 135), Indianapolis, in January.