Industrial Distribution

completion at 46 percent; finding more qualified people at 42 percent; increased operating costs at 31 percent; and e-commerce at 31 percent.

• More than 67 percent of respondents say e-commerce is a
priority for them — up more than four percentage points
year-over-year — while the amount who say they are currently
generating online sales improved more than six points year-over-
year to 63.5 percent
Other notable findings from this section:

• 24. 4 percent of respondents picked Internet sales as one of their top three primary growth strategies — up more than three percentage points year-over-year

• Asked what they primarily use their website for, respondents’ top selections were housing technical/product information (55 percent); e-commerce (41.5 percent); generate leads (41 percent); and find new customers (39.5 percent)

• More than 31 percent of respondents were at least approached in the past year about being acquired

• 83 percent of respondents redesigned their website within the last several years

• Nearly half of respondents — 49 percent — think industrial distributor M&A activity will stay approximately the same in the year ahead as it is now

• 48 percent of respondents update their website content at least monthly

• Only 32 percent of respondents have a mobile app for their website

• More than 32 percent of respondents would be agreeable to a buy-out — up three points from a year ago

• 31 percent of respondents are actively looking to purchase another distributor

• 70.5 percent of respondents between 1 to 10 percent of overall sales from e-commerce; 21. 5 percent of respondents get between 11 to 20 percent of sales online; and only 8 percent of respondents see more than 20 percent of sales come from the web

Technology Usage & Investments

Industrial distributors have been notoriously slow when it comes to embracing and adopting technology, likely due to most of them being family-owned, small-to-midsize companies that either lack capital or are just set in their ways. The amount of our respondents who indicate they’ve invested in technology has glacially increased over the years, but in 2018 we’re happy to report a sizable bump in most areas. The amount of respondents whose company utilizes

• 76 percent of respondents expect their online sales to increase over the next year — up seven percentage points from our 2017 survey

The Balance Sheet

CRM software jumped 11 percentage points year-over-year to 64
percent; those that offer online web ordering bumped up almost two
points to 62 percent; respondents who use ERP software jumped
Of our survey sections, this one by far is the most telling of the industrial
economy, and it’s saying times are good. The amount of respondents
who indicated their sales increased compared to a year earlier jumped
17 percentage points from 2017 to 73 percent in this year’s survey.
For context, that figure was down to 42.5 percent in our 2016 survey.
Likewise, the amount who indicated profits have increased improved
more than seven points year-over-year to 65 percent.

11 points to 38 percent; and those who use warehouse management systems increased five points to 35 percent.

Of the following business technologies,
which do you have in use currently?

Sales decreased
Customer relationship management
Sales increased
Online web ordering
Sales remained
approximately the same

Sales force automation

0% 10% 20% 30% 40% 50% 60% 70% 80% 90%

Enterprise resource planning Wireless email/internet access Warehouse management systems

In terms of your expectations for next year,
how do you anticipate your sales to fare?

Demand forecasting
Radio frequency ID
Sales will decrease

0% 10% 20% 30% 40% 50% 60 70%

Sales will increase

Here are some other key findings in this section:

Sales will remain approximately the same

• Of the technologies we listed that respondents currently don’t have in use, the ones they are most likely to adopt over the next two years are online web ordering ( 30 percent); demand forecasting ( 27 percent); and CRM ( 26 percent)