Distributor Industry Sales

4Q 2012, Year-End 2012 Industry Sales Report

Research by ASI

On January 10th, 2013, ASI® commissioned an exclusive survey to estimate industry sales for 2012. The industry outlook for 2013 was also included in the study. Invitations went to ASI distributor members who were the primary contact with their firms, and had been in business at least one year. The results of this survey will be published in Counselor® PromoGram® and on ASICentral.com.

A total of 982 distributor firms responded to the survey request out of 13,300 invited, resulting in a 7.4% response rate. An incentive of a drawing for $500 was offered. Larger distributors were over-sampled, with results then weighted for a more accurate analysis.

Beginning with the 1Q 2010 Sales Study, an ongoing participant panel has been implemented. There are 31 ASI members, all among the largest players in the industry, who have agreed to participate in each Quarterly Sales Study.  

The 1Q 2013 Sales Study Report will be published in April 2013.

Conclusions:

  • Total industry sales for 2012 were $19.4 billion, up 5.2% from 2011. Seventy- three percent of larger distributors (over $1 million in revenue) reported an increase in sales, while two-thirds (66%) of all distributors reported an increase.

  • During the fourth quarter, there was a 5.1% year-over-year increase in sales among ASI distributor members. Over one-half (51.0%) of all distributors reported an increase in the fourth quarter, with distributorships of at least $250,000 in annual revenue reporting greater percentage increases in sales than small distributorships.

  • Distributors are fairly optimistic about sales for 2013, particularly the largest distributors. More than two-thirds (67.1%) of all distributors feel sales for 2013 will be higher than sales in 2012. The largest distributors were the most bullish on 2013, with 72.1% anticipating increased sales.

    • However, in 2012, over three-quarters (77.1%) of distributor firms expected an increase in sales for the year. This suggests that there is less optimism for 2013 than there was for 2012. Smaller distributors in particular are less optimistic, as 79.3% felt 2012 sales would be stronger than 2011, but only 65.6% feel similarly for 2013.

Detailed Findings:

How did your annual 2012 sales compare to your annual 2011 sales?

  • Two-thirds (65.8%) of distributors reported higher sales in 2012 than in 2011. Two and half times as many distributors saw an increase as experienced a decrease in sales in 2012 compared to 2011.  

2013 Sales vs. 2012 Sales

How did your annual 2012 sales compare to your annual 2011 sales? (By company size)

  • As the size of the distributorship increased, so did the proportion with higher sales in 2012 than 2011. Nearly 73% of larger distributors (over $1 million in sales) reported an increase, compared to less than two-thirds (60.0%) of smaller distributors (less than $250,000 in sales).

2013 Sales vs. 2012 Sales By company size

How did your fourth-quarter 2012 sales compare to your fourth-quarter 2011 sales?

  • Over one-half (51.0%) of respondents reported an increase in sales in the fourth quarter of 2012 compared to the fourth quarter of 2011.

4Q '13 Sales vs. 4Q '12 Sales

  • The fourth-quarter year-over-year sales increased 5.1%. This was the largest increase since the first quarter of 2012.

  • Distributors with revenue under $250,000 reported a 1.8 percentage point increase in revenue – the smallest of any group. The smallest distributors as a whole are the most volatile, with more distributor firms entering and leaving the industry than any other group. Medium-size and larger distributors showed an increase in sales of 6.6% and 6.8%, respectively.

Current Quarter Sales vs. Quarter Year Ago

Industry Sales vs. Same Quarter Prior Year

  • The fourth quarter of 2012 resulted in a sales increase of 5.1%, the twelfth straight quarterly increase.

  • The quarterly increase in revenue was about the same as it was in 3Q 2011 (5.1%), and it’s higher than increases in the second and third quarters of 2012.  

Industry Sales Revenue % Change vs. Year Ago Quarter

Current Quarter Sales vs. Same Quarter One Year Ago

  • Quarterly Sales Study Reports continue to show a rebound in the percentage of distributor firms that indicate the current quarter’s sales are greater than those of the corresponding quarter from the prior year.

    • Findings for 4Q 2012 vs. 4Q 2011 show 51% of distributor firms reported an increase in sales vs. the corresponding quarter in the prior year. This percentage has been over one-half since the first quarter of 2010.    

% Distributor Firms with Increase in Sales Qtrly Comparisons
(Source: ASI Quarterly Sales Study Reports)

What is your forecast for your overall sales in 2013 compared to sales in 2012?

  • Over two-thirds (67.1%) of respondents expect an increase in sales in 2013.

  • The number of distributor firms anticipating an increase is over ten times greater than the number of those anticipating a decrease.

Sales Forecast 2013 vs. 2012

How do you feel your sales for all of 2013 will compare to your sales for all of 2012? (By company size.)

  • The sales forecast among distributor firms for 2013 vs. 2012 shows optimism across different sized distributorships. The largest distributors (over $1 million) were again the most optimistic, with 72.1% anticipating higher sales this year.

  • Distributors forecasting an increase estimated an aggressive increase in sales of 12.7% for 2013. Those forecasting a decrease estimated a decrease of 10.8%.

Sales Forecast 2014 vs. 2013 By Company Size