January 10, 2008 - Modern Distribution Management

January 10, 2008

MSC Industrial Sales Up 8.8% in 1Q

MSC Industrial Direct Co. Inc., Melville, NY, distributor of MRO supplies to industrial customers, reported sales in the first quarter 2008 were $437.6 million, an increase of 8.8% from the prior-year period. Profit was up 16.3% to $46.9 million.
 
Financial results for the first quarter were solid and in line with our expectations,”said David Sandler, president and CEO. “We continued to make progress executing our overall growth strategy. The integration of J&L has been successful, and we have made good progress on our plan to sell MSC products to our J&L customer base.”
 
“In addition, our West Coast initiative is making solid progress. Our new sales offices in Seattle, Portland, and Salt Lake City are now open and this initiative continues to meet our …

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Commentary: Make Great Employees Your Strategy

Employees who care about a customer? Valuable. Employees who take ownership of making customers happy and initiative in making your company more profitable? Priceless and perhaps increasingly extinct.
 
Distributors aren’t ignoring the issue of human resource development. In fact, the University of Industrial Distribution, an annual program that a few years ago went begging for students at its annual one-week session, has been quickly selling out about 500 seats the past two years. But it will take a lot more than annual off-site training to keep your company competitive and growing in turbulent economies. A team of motivated, resourceful and creative problem solvers can make the difference in a company’s performance.
 
People with great skills are in short supply; …

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Report: Sources of Productivity Growth Differ in U.S., Canada

Labor productivity in the manufacturing sector of both Canada and the U.S. increased at the same average pace between 1961 and 2003, according to a new report from Statistics Canada. Labor productivity is a measure of real output per hour worked.

In Canada, the more intense use of intermediate inputs, such as parts and materials, was a more important source of labor productivity growth than it was in the U.S. In the U.S., investment in capital and multifactor productivity growth (or the efficiency with which capital, labor and intermediate inputs are used in production) were the key factors.

According to the report, labor productivity in the manufacturing sectors of both countries increased at an annual average rate of 3.2 percent.

In Canada, the deepening …

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U.S. Market Analysis: O-Rings

The industrial product group listed here – O-Rings – represented a market in 2007 of $611.9 million, according to estimates by Industrial Market Information, Minneapolis.

These charts show the top ten industries, by SIC code, consuming these products; and the 2007 end-user consumption of these groups sorted by the nine government market regions. …

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MDM News Digest 3801

Investment firm Berkshire Hathaway, Omaha, NE, will buy 60 percent of Marmon Holdings Inc., a private holding company with more than 125 manufacturing and service businesses that operate independently, for $4.5 billion. The sectors covered include: wire and cable, transportation services and engineered products (including rail), highway technologies, distribution of pipe and tubing, flow products, industrial products (including fasteners, safety products and metal fabrication), construction services, water treatment equipment, and retail services. Companies have collective revenues of $7 billion. Marmon was formed in 1953 when it was acquired as a small ailing manufacturer in Ohio by Jay and Robert Pritzker. Frank Ptak is currently CEO of Marmon.

MDM News Digest 3801 Read More »

Monthly Wholesale Trade Sales & Inventories: October 2007

October 2007 sales of wholesalers, except manufacturers’sales branches and offices, were $369.8 billion, up 0.7 percent from the revised September level and were up 11.5 percent from the October 2006 level. The September estimate was revised upward $0.4 billion. October sales of durable goods were up 0.6 percent from last month and were up 5.3 percent from a year ago.

Compared to last month, sales of computer and computer peripheral equipment and software were up 4.3 percent and sales of metals and minerals, except petroleum, were up 3.8 percent. Sales of nondurable goods were up 0.7 percent from last month and were up 17.7 percent from last year. Sales of drugs and druggists’sundries were up 4.0 percent from last month, and sales of chemicals and allied products were up 2.9 …

Monthly Wholesale Trade Sales & Inventories: October 2007 Read More »

Legal Trends in the Workplace

It’s sometimes tough to see what the future holds in the always unpredictable world of employment law. The state of the economy, new legislation, the politics of an election year, unexpected court decisions, societal trends, and media/cultural happenings all play a role in how our workplaces will be shaped in 2008.
 
My employment law forecast predicts an increase in employment litigation filed by disgruntled former (and current) employees.

The EEOC has announced a number of enforcement priorities for the new year, including a renewed emphasis on bread and butter”claims such as sexual harassment and retaliation, and a new emphasis on generational issues created by the mixture of different generations in the workplace.

In December, the agency …

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Fein: Housing Market Now a Leading Economic Indicator

MDM Webcasts recently featured Pembroke Consulting President and Facing the Forces of Change author Adam Fein in Wholesale Distribution Economic Outlook: Adam Fein’s First Look at 2008.”Fein told participants that he does not see an extreme downturn coming, but that they should watch key indicators -especially related to housing -as the year moves forward.
 
In the Webcast, Fein tackled high-level economic issues, including the key dynamics behind today’s economy, the economic outlook and implications for key distribution markets, and what participants should consider as they plan where their company will go in the next year.
 
The presentation centered on major markets that distributors sell into: construction, …

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Develop Branch CEOs

A distribution branch manager in many cases has worked his way through the ranks, but may not have had formal management training. In fact, the average manager may be so busy with his daily work that there hasn't been time to spend on higher-level localized market research and business planning. Wholesaler-distributors need to shift how they view the role of their branch managers by giving them the power to dig deeper into their markets.
 
Vancouver, BC-based heating, ventilation, air conditioning, and refrigeration distributor Independent Supply Company went from start-up in 2000 to eight branches in Ontario and Western Canada.

In 2006, Independent Supply decided that to maintain that fast growth, it needed to shift how it viewed the job of branch …

Develop Branch CEOs Read More »

Lewis-Goetz Taps New President/CEO

Industrial distributor Lewis-Goetz and Company, Inc., Pittsburgh, PA, has named Jeffrey T. Crane as president and CEO. Crane has served as the company’s president since May 2006.
 
David R. Goetz, Sr., formerly chairman and CEO, will remain as chairman of the company. Goetz, who turns 63 this month, will continue to drive the organization’s acquisition activities and remain active with major customers and suppliers.
 
Lewis-Goetz is a distributor of industrial rubber products, including industrial, hydraulic and metal hose; conveyor belts; gaskets and seals; and related accessories and services. Lewis-Goetz operates from 60 locations throughout the U.S. and …

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Avnet to Buy UK-Based Azzurri

Avnet, Inc. has agreed to buy UK-based distributor Azzurri Technology Ltd. Azzurri is a distributor of high technology semiconductors and embedded systems products in Europe.
 
Upon closing, Azzurri will be integrated into Avnet Electronics Marketing EMEA primarily within the Avnet Memec specialist division.
 
Azzurri has operations in the UK, Germany, France and Italy. Its annual revenue is US$100 million and it employs about 80 people.
 
Avnet is a distributor of electronic components, computer products and technology services and solutions with more than 300 locations serving more than 70 countries worldwide. For the fiscal year ended June 30, 2007, Avnet had sales of $15.68 …

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Cleaning Product Supplier Zep Sales Up 5% in 1Q

Industrial cleaning product supplier Zep Inc., Atlanta, GA, reported sales in the first quarter ended Nov. 30, 2007, were $143.6 million, up 4.9%. Profit was $6.3 million.
 
During the current year’s first quarter, the cost of commodities utilized in manufacturing continued to increase, and Zep management anticipates higher commodity costs in coming quarters.
 
These increases in material costs are expected to be offset by higher selling prices.
 
We anticipate revenue growth with the continued focus on growing our core business through our Zep Sales &Service organization and increased market share through our entrance into the $6.4 billion industrial distribution channel. One of our goals is that within three years, distributor channels will become …

Cleaning Product Supplier Zep Sales Up 5% in 1Q Read More »

MDM January 10, 2008

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 info@mdm.com to …

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