Distributor Industry Sales

1Q 2014 Industry Sales Report: Industry Sales Increase 6.4%

Research by Nathaniel Kucsma

In April 2014, ASI® commissioned an exclusive survey to estimate industry sales for Q1 2014. The industry outlook for 2014 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®, on ASICentral.com and in multiple external media outlets.

A total of 377 distributor firms responded to the survey. The response numbers were likely negatively impacted as the Counselor State of the Industry survey was conducted the week before.

Key Findings:

  • More than half of distributors (55%) reported a year-over-year increase (Q1 2014 vs. Q1 2013) in sales.

    • About one in five reported a decline (19%), with the remaining (26%) reporting that sales were about the same.

  • The average growth was at 6.4%, which is up from Q4 2013 (5.7%).

    • Q2 growth numbers have declined from Q1 numbers in each of the last three years. It will be interesting to see if this trend continues.

    • The Q1 2014 number was above the four quarter moving average, indicating that Q1 was exceptionally strong.

    • Growth rates trended upwards with the size of the distributor. The largest revenue distributors (those with over $1 million in sales) experienced the largest year-over-year increases.

  • Building on strong Q1 numbers, two-thirds (66%) of distributors expect their 2014

    • Larger revenue distributors with over $1 million in annual sales are even more bullish about 2014, with over 70% expecting an increase in sales.

  • The Counselor Confidence Index has continued the strong growth experienced through 2013. In fact, Q1 2014 sentiment is as high as it has ever been, equaling the high last seen in 2006.

Q1 2014 Sales vs. Q1 2013 Sales

  • In total, more than one-half of distributors reported a year-over-year increase in first-quarter sales.

  • Larger revenue distributors reported somewhat more positive results than smaller ones.

2013 Sales vs. 2012 Sales

Q1 2014 Sales vs. Q1 2013 Sales - By Distributor Revenue

  • Year-over-year sales continued to swing in a positive direction in Q1 2014 when compared with Q1 2013.

  • Large distributors with over $1 million in annual sales are experiencing the greatest growth.

Industry Sales Revenue

  • Quarter-over-quarter industry sales were up for more than half of all distributors in the first quarter of 2014 when compared to the first quarter of 2013.

  • The four quarter moving average, which declined through much of 2013, is now trending upwards.

% of Distributor Firms with Increase in Sales

Sales Forecast 2014 vs. 2013

  • Distributors are bullish about their prospects for 2014, with two-thirds expecting an increase in sales over 2013.

  • Larger revenue distributors are even more positive than smaller revenue distributors, with nearly three-quarters expecting an increase.

Sales Forecast 2014 vs. 2013

2014 Sales Forecast  vs. 2013 Saless

Counselor Confidence Index

Beginning with the first quarter of 2014, ASI is producing another measure of industry sales results. Taking data from nearly a decade and a half of Counselor magazine’s State of the Industry survey results, ASI has developed the Counselor Confidence Index.

Patterned after The Conference Board’s Consumer Confidence Index®, the Counselor Confidence Index is an indicator designed to measure distributor health, which is defined as the degree of optimism on the state of the industry that distributors are experiencing through the results of their business operations. The value from the industry health question is compared against each respective score since 2001, and an index is derived. The year 2001 was chosen as a benchmark because it was neither a peak nor trough in the business cycle.

Starting with Q1 2013, the Counselor Confidence Index is measured quarterly, instead of annually, to provide more timely information about the state of the industry.

  • The Counselor Confidence Index showed very strong growth in the first quarter of 2014, equaling the all-time high that was set back in 2006.

Counselor Confidence Index