The PHCP industry’s bounce back from the Great Recession continues.
The vast majority of respondents to the 2014 Supply House Times Premier 150 survey again reported an increase in overall sales, continuing an upward industry trend since the start of the decade. The annual Premier 150 survey, conducted by Supply House Times and BNP Media Market Research, ranks the top PHCP wholesalers by their reported sales for the past year. This year’s survey is based on sales for fiscal 2013 and, as always, individual company sales are not disclosed.
|Go to the 2014 Premier 150 List.|
This time around, 82% of respondents to the survey reported increased sales in 2013, while only 9% reported a decline in sales and 9% stated sales were flat last year. In last year’s survey, 81% of respondents reported increased sales, while the 2012 Premier survey showed 80% of respondents had increased sales in 2011. The 82% actual sales number falls below the 88% of 2013 survey respondents who projected increased sales last year.
“2013 was a strong year in the New York area and we have positioned ourselves to take advantage of the future trends in our marketplace,” New York City-based Central Plumbing Specialties/Grande Central Showrooms of New York President Howard Frankel said. “We had double-digit growth in 2013 and added a new showroom late in the fourth quarter. We have further expansion plans in 2014 to ensure that continued growth and our position in our market.”
Rapid City, S.D.-based Northwest Pipe Fittings also was in an expansion mode last year. “Overall, 2013 was a successful year for our company,” President Randy Bentley said. “We added an additional location for distribution and our sales exceeded the previous year.”
Turn up the volume
Respondents to the Premier 150 survey registered $56.3 billion in sales for fiscal 2013. That number is up from last year’s total of just under $51 billion and greatly improved from a 2011 total of nearly $43 billion in sales.
Ferguson, with its 1,350 branch locations, again was the overall No. 1 company in terms of total sales.
The survey shows both the pipe, valves and fittings and plumbing-hydronics segments of the industry enjoyed robust total sales increases in 2013. The PVF segment led the way this time around with survey respondents reporting total sales of $14.4 billion — a sound increase from a 2013 total of $12.5 billion in sales.
“2013 was a year of solid growth and territory expansion for our company,” East Windsor, Conn.-based Collins Pipe & Supply President Brian Tuohey said. “We look for 2014 to be more of the same.”
The P & H component of the industry reported total sales of $8.9 billion for fiscal 2013, up from a 2013 total of $7.1 billion. “The strategic changes we made during the recession have paid off,” said Elkhart, Ind.-based Mid-City Supply President Jeff New. “2013 was a great year and we also expect 2014 to be good.”
HVACR-focused supply houses reported $9.4 billion in total sales, down from $10.5 billion in 2013.
In terms of the survey’s fiscal demographics, 8% of respondents reported 2013 sales of $500 million or more. The greatest number of companies responding to the survey fell in the $34.9 million or less category (35%), while companies with 2013 sales in the $50-$99.9 million range accounted for 21% of the survey’s respondents.
“With the worst of the economy behind us, we are rapidly moving from survival mode and back into a growth and expansion mode,” Wilmington, N.C.-based Murray Supply CEO Charlie Murray said.
Gazing into the future
While 2013 was a strong year for many, even more companies are looking at 2014 to be another prosperous year with 89% of survey respondents predicting increased sales this year. No company that responded to the survey predicts its sales will decrease this year, while 10% say sales will stay flat.
“We experienced double-digit growth in 2013 and are anticipating exceeding this in 2014,” New York-New Jersey-based Ramapo Wholesalers General Manager Tony Lo Russo said.
While optimism in the industry remains high, there is one word that concerns survey respondents — margin. “The last couple years have been strong sales years for us, but we’re still struggling with intense margin pressure,” Murray noted. “Unfortunately, we don’t see that improving much any time soon. This is the ‘new normal’ we have been preparing for. We’re excited about the future and what we’re doing.”
Metairie, La.-based Southland Plumbing Supply also is feeling margin erosion in its market and is taking steps to counteract that trend.
“We have added emphasis to our showrooms with the addition of lighting, appliances and a new contractor showroom adjacent to our Kohler plumbing showroom,” Owner-President Alan Vinturella noted.
Sioux Center, Iowa-based Plumbing & Heating Wholesale is expecting more positives to come from the local commercial industry this year. “We expect the commercial sector to remain strong in 2014, driving plumbing business,” CEO Mike Plasier said. “The residential sector in our territories really is coming to life in both single-family and multifamily housing. Our showroom also has taken a giant leap forward and we expect it to be solidly profitable in 2014.”
Major news from 2013
- The International Builders’ Show and KBIS announced plans to co-locate their events in Las Vegas starting in 2014.
- Morrison Supply announced the acquisition of Santa Monica, Calif.-based Express Pipe & Supply as well as Oklahoma City-based Norman Plumbing Supply. MSC Holdings, parent company of Morrison and Express Pipe & Supply, also acquired the assets of Mesa, Ariz.-based Farnsworth Wholesale.
- Robert Mannheimer was named chairman of the board at Blackman Plumbing Supply.
- MRC Global acquired the operating assets of Midland, Texas-based Production Specialty Services and also acquired Stream AS and Flangefitt Stainless. The company also opened a new regional distribution center in Tulsa, Okla.
- Ferguson acquired Fluid Systems Hawaii in an asset transaction and also broke ground on a new 400,000-sq.-ft. distribution center in Celina, Ohio.
- WinWholesale opened 13 new locations and made three acquisitions in fiscal 2013, which upped the company’s portfolio to 559 locations around the country.
- F.W. Webb acquired Elmwood Park, N.J.-based industrial PVF distributor Bergen Industrial Supply and also opened a new location in Springfield, Mass.
- Cregger Co. transferred assets for two of its Illinois branches to St. Louis, Mo.-based Plumbers Supply Co.
- Bonney Forge acquired Italian industrial valve manufacturer BFE S.p.A.
- Central Plumbing Specialties expanded its Bond St. Grande Showroom and opened a new location in Rockland Co., N.Y.
- Mestek Chairman of the Board and CEO John Reed died.
- Grundfos broke ground on the site of its new North American headquarters in Downers Grove, Ill.
- Southern Pipe & Supply celebrated its 75th anniversary with a major gala attended by 300 guests. The Meridian, Miss.-based company later was named the 2013 Supply House Times Supply House of the Year.
- Mainline Supply founder Fred Kroger died at age 89.
- Aquatherm President and CEO Steve Clark died at age 55.
- Audubon (N.J.) Supply celebrated its 100th anniversary.
- HD Supply announced it started an initial public offering of more than 53 million shares of common stock.
- Aaron & Co. acquired Brielle, N.J.-based distributor Dickson Supply.
- Orlando-based Spirit Group was named the 2013 Supply House Times Manufacturers Representative of the Year.
- Supply House Times was the recipient of an Award for Publication Excellence honor for its July 2012 cover titled “The House That Service Built.” The cover shows MRC Global’s Galena Park, Texas valve distribution center.
- Viega named Dave Garlow president and CEO and Robert Boots chief operating officer.
- Collins Pipe & Supply acquired the assets and staff of the Apex Remington Pipe & Supply location in Marcus Hook, Pa.
- Merfish Pipe & Supply purchased the assets of Pennsylvania-based distributor BBL.
- El Cajon (Calif.) Plumbing & Supply celebrated its 40th anniversary.
- Reeves Journal, started in 1920, joined BNP Media’s Plumbing Group.
- COOPER Valves acquired Houston-based Accuseal.
- Grant Supply celebrated its 80th anniversary.
- American Standard Brands announced a distribution partnership with Ferguson.
- OmegaFlex’s Ed Moran was named the winner of AIM/R’s Golden Eagle Award.
- Knoxville, Tenn.-based Modern Supply announced a deal to carry Kohler products.
- Sumitomo Corp. and Edgen Group signed a definitive merger agreement.
- R.E. Michel Co. purchased Janesville, Wis.-based Connors Supply.
- American Piping Products acquired Ozark Tubular.
- Deacon Industrial Supply celebrated its 50th anniversary.
- Rheem acquired Heat Transfer Group.
- Nadia Askar joined BNP Media’s Plumbing Group as associate editor.
- Energy expert and multi-time PVF Roundtable speaker Michael Economides died at age 64.
Voices in the industry
Some other thoughts from distributors regarding the 2013 fiscal year and expectations in 2014.
“We are forecasting and increase in 2014 due to some construction projects.” —James Mummert, Industrial Piping System
“In 2013 revenue was up, margins were greater and we invested more into the company. In 2014, we will focus on measurable, operational improvements and what the customers want. Hopefully, we will achieve another strong year.” —Rogers Earl Jr., Valley Supply Co.
“Miami is an extremely active city today and I believe it will be busy for many years to come.” —Dennis Lehman, Lehman Pipe & Plumbing Supply
“The energy sector continues to be strong and encourages our company to pursue growth opportunities as they present themselves.” —Ed Foreman, M & M Supply
See below for a list of the 2014 Premier 150 rankings, charts and graphs.
- 2014 Premier 150 Rankings. Source: Supply House Times/BNPMedia Market Research 2014
- Sales Trends for 2014 Premier 150 (Year-to-year comparison and projection). Source: Supply House Times/BNPMedia Market Research 2014
- Segment Leaders for 2014 Premier 150. Source: Supply House Times/BNPMedia Market Research 2014
- Combined Sales (in billions of dollars) and Consolidation Update (by millions of dollars) for 2014 Premier 150. Source: Supply House Times/BNPMedia Market Research 2014