SUPPLIER Industry Sales

2Q 2013 Industry Sales Report: Industry Sales Increase 4.8%

Research by Larry Basinait

On July 1, 2013, ASI® commissioned an exclusive survey to estimate industry sales for the second quarter of 2013, as well as the outlook for all of 2013. Invitations went to ASI supplier 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 ASI press releases.

The 3Q 2013 Sales Study Report will be published in October 2013.

Methodology:

A total of 127 supplier firms responded to the survey request out of 2,339 firms invited, resulting in a 5.4% response rate. An incentive of an annual drawing for $500 was offered.

Conclusions:

  • During the second quarter, there was a year-over-year increase in sales among ASI supplier members of 4.8%. This is the fourteenth consecutive increase in sales vs. the corresponding quarter of the previous year and up slightly from the increase in the first quarter, which was 4.5%.

    • The percentage increase in sales for the second quarter of 2013 (4.8%) was slightly higher than the percentage increase in sales for the second quarter of 2012 (4.6%).

  • Total supplier sales for the second quarter were approximately $3.2 billion. The net increase over Q2 2012 was $148 million.

  • Sales for all of 2013 are expected to be higher than 2012 by 54.3% of suppliers, a decline from the first quarter when sales were expected to be up by 57.0% of suppliers.

    • At the end of the second quarter last year, 72.0% of suppliers felt sales for 2012 would be higher, so there is less optimism now than then. The drop is 17.7 percentage points.

    • While suppliers with sales under $10 million and those with sales above it are less optimistic now, the largest suppliers forecast dropped the most, from 82.2% anticipating an annual increase at the end of 2Q 2012 to 53.8% anticipating an increase now.

  • Distributors were also fairly optimistic about sales for 2013. Over one-half (58.7%) of all distributors feel sales for 2013 will be higher than sales in 2012.

    • However, similar to suppliers, fewer distributors are expecting to better the results they had in 2012. During Q2 2012, 71.4% of distributor firms expected an increase in sales for the year.

Detailed Findings:

Supplier vs. Distributor Sales

  • Supplier sales for the first quarter of 2013 increased by 4.8%, the 14th consecutive increase. The change is in line with reported increases since 2Q 2012.

  • The increase in sales for suppliers was lower than for distributors, who had a 5.1% increase. Distributors have had slightly greater increases in quarterly sales for three consecutive quarters.

Industry sales revenue % change vs. year ago quarter

How did your second-quarter 2013 sales compare to your second-quarter 2012 sales?

  • 52.8% of respondents reported an increase in sales, while 24.4% reported a decrease. This was a rebound from the prior two quarters when less than one-half of suppliers reported higher quarterly sales vs. the corresponding quarter one year prior.

Sales results qtrly comparison

How did your second-quarter 2013 sales compare to your second-quarter 2012 sales? (Continued)

  • Both larger (more than $10 million in sales) and smaller (less than $10 million in sales) suppliers reported increases in sales as compared to the corresponding quarter from the prior year. Smaller suppliers reported a greater increase in sales (6.0%) than larger suppliers (4.3%). Smaller suppliers also posted a greater increase in sales for the first quarter of 2013.

  • The percentage increase for the second quarter of 2013 (4.9%) was slightly higher than the percentage increase for the second quarter of 2012 (4.6%).

  • Total supplier sales for the second quarter were approximately $3.2 billion. The net increase over Q2 2012 was $148 million.

Current quarter sales vs. quarter year ago

How do you feel your sales for all of 2013 will compare to your sales in 2012?

  • Over one-half (54.3%) believe sales for 2013 will be higher than in 2012. Smaller suppliers and larger supplier were about equally as likely to indicate that sales were forecast to be higher.

    • This contrasts with findings from the first quarter, when smaller suppliers were more optimistic with their forecast for 2013; nearly 6 out of 10 (59.4%) felt sales in 2013 will be higher than in 2012, vs. 50.0% of larger suppliers anticipating an increase. Larger suppliers are more optimistic now.

  • Among those anticipating an increase in sales over 2012, the average increase is 12.5%, while the minority anticipating a decrease estimated a decline of 14.6%.

Forecast 2013 sales vs. 2011 sales