Electrical distributors report predictions for a strong upturn in sales growth in the second quarter 2007, despite a continued decline during the first quarter, according to NAED’s most recent Quarterly Sales Change Expectation Survey (QSCE).

Electrical distributors report predictions for a strong upturn in sales growth in the second quarter 2007, despite a continued decline during the first quarter, according to the National Association of Electrical Distributors’ (NAED) most recent Quarterly Sales Change Expectation Survey (QSCE).

For the quarter ended March 31, a total of 61.2% of distributors indicated their sales had grown. This marked the third consecutive quarter in which the percentage of distributors reporting growth had declined. The portion of distributors estimating increases of 10% or more remained virtually unchanged from the prior quarter at 29.5%. The number of distributors whose sales declined grew to 31.7%.

Distributors have positive expectations for the second quarter now under way, with 75.7% forecasting sales increases. In addition, 24.3% of those surveyed foresee their sales increasing by 10% or more. Flat or declining sales are predicted by 21.6%.

The first quarter was difficult in the Northeast, where only 32.4% of distributors posted gains. Other regions attained growth rates closer to the norm, with gains reported by 64.2% of Midwest distributors, 66.7% of South distributors, and 65.5% of those in the West.

All regions are optimistic about the second quarter. Expectations are strongest in the Midwest, where 83.2% of companies anticipate growth. Northeast distributors expect to rebound as 67.6% predict growth. In the South and West, 70.4% and 75.9% of distributors see positive results on the way.

The greatest expectations for growth are among larger companies. For the first quarter, the largest number of distributors experiencing sales growth were those with 30-49 employees, at 67.5% of companies reporting. Close behind were companies with 50 or more employees, and those with 20-29 employees, each at 63.9%. Companies with 1-4 employees trailed at 42.9%, along with those with 5-9 employees at 54.3% and 10-19 employees at 62.0%.

Most optimistic for the second quarter were companies with 50 or more employees, with 83.6% forecasting sales growth, and those with 30-49 employees, of which 80.0% are expecting growth. Least optimistic were companies with 20-29 employees at 69.4%, and those with 10-19 employees at 70.4%. In the middle were distributors with 1-4 employees at 78.6%, and those with 5-9 employees at 73.9%.

The survey was distributed in early April and e-mailed or faxed to approximately 4,000 distributor locations. The questionnaire is administered quarterly and focuses on sales expectations for the previous and upcoming quarters. The report breaks down statistics by geographic region and number of employees.

For more information, contact Branton White, NAED senior director of technology and associate editor of research for TED Magazine, at (888) 791-2512 or bwhite@naed.org.