Distributor Sales Surpass $20 Billion In 2013
Result Is All-Time High
Ad specialty distributors increased their revenues by 5.3% in 2013, pushing total industry sales to $20.5 billion last year, according to a report released today by ASI. The result is an all-time annual high, besting the previous yearly record of $19.8 billion in distributor revenues in 2008. Data also showed distributors grew sales by 5.7% in Q4 of 2013, the 16th straight quarterly rise. Meanwhile, the Counselor Confidence Index – a tool that measures distributor health and optimism – improved to 113.2 in the fourth quarter, reaching its highest point since being introduced a year ago.
“The economy slowly returning to better health has been driving modest revenue increases throughout our industry,” says Marc Simon, CEO of Top 40 distributor Halo Branded Solutions (asi/356000). “The more distance we put between ourselves and the 2008-2009 economic issues, the better off we are.”
In 2013, 86% of larger distributors (more than $5 million in annual revenues) reported an increase in sales, while 68% of all firms – regardless of size – reported gains. In Q4, 54% of surveyed distributors improved revenues over the same period in 2012, with larger firms again making the biggest sales jump. The 5.7% Q4 increase is the best quarterly sales gain since Q1 of 2013 as firms closed the year strong.
“Generally, I think the business is finally rebounding from 2008 and 2009,” says Rod Brown, managing director at MadeToOrder (asi/259540). “We were up 12% for 2013 versus 2012.”
With the economy strengthening, distributors have high expectations for 2014. Data shows 74% of distributors anticipate an increase in sales this year, while only 4.5% of distributor firms are expecting a drop off in revenues. “Our overall experience is that we saw growth greater than the industry average,” says Jo-an Lantz, executive vice president of Top 40 distributor Geiger (asi/202900). “We anticipate another great sales year in 2014. The industry will have another growth year, and we are expecting the same.”