Gathering Strength

Similar to 4Q10 results, it appears 1Q11 demand trends are higher than the typical seasonal trend for sales in the 1Q. Approximately 52 percent of respondents noted 1Q11 demand levels grew quarter-over-quarter, compared to 41 percent of respondents that stated positive growth was characteristic for...

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Bibliographic Details
Published inElectrical Wholesaling Vol. 92; no. 5; p. 27
Main Authors Kure, Anthony, Ackerman, Karl
Format Magazine Article Trade Publication Article
LanguageEnglish
Published Nashville Endeavor Business Media 01.05.2011
Subjects
Business conditions
Capital market
Commodities
Costs
Distributors
Electrical equipment
Employees
Inventory
Market strategy
Polls & surveys
Supply chains
Trends
United States > US
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Summary:Similar to 4Q10 results, it appears 1Q11 demand trends are higher than the typical seasonal trend for sales in the 1Q. Approximately 52 percent of respondents noted 1Q11 demand levels grew quarter-over-quarter, compared to 41 percent of respondents that stated positive growth was characteristic for the 1Q. Quarter-over-quarter demand trends continued to improve on a sequential basis since 3Q10 with 52 percent of respondents indicating growth vs. 45 percent in 4Q10 and 42 percent in 3Q10 (Figure 1). Based on expectations for inventory builds, it appears forward-looking sentiment is incrementally positive as a greater portion of respondents are anticipating expanding inventories relative to 2Q10. Approximately 37% of respondents noted they are investing capital towards inventory for the upcoming quarter (2Q11), which is a substantial increase from 20% in 4Q10 and 23% in 3Q10 (Figure 4). Most respondents did not add or cut headcount during 1Q11 (45 percent in 1Q11 vs. 60 percent in 4Q10). However, 37 percent actually added employee hours or hired additional employees (28 percent in 4Q10) vs. those who reduced employee hours or laid off employees (18 percent in 1Q11 vs. 13 percent in 4Q10). Increased hiring at the distributor level is a great indicator of business confidence, as distributors are often among the last players in the supply chain to hire in an up-cycle.
ISSN:0013-4430
2771-6414