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INDUSTRY NEWS
ASA members report increasing profitability, revenue growth
CHICAGO— American Supply Asso- ciation members reported growth for the seventh consecutive month, showing a 7.9% improvement in per workday revenues during the month of November 2010, as compared to the same month in 2009 and down only 11.1% against 2008. The plumbing, heating and PVF
distributors are now ahead of last pre- vious year-to-date by 2.0% on a per day basis. As there was one more workday in November 2010 than in 2009 and two more than 2008, the raw monthly revenues for the indus- try members were up 12.7% for the month vs. 2009 and down only 1.7%
on the rise and are beginning to improve, as 12-month
Inventory turns are finally
sales growth now exceeds the inventory increases.
as compared to two years ago. Consistent with October 2010, al-
most half of all distributors in No- vember again reported reduced margins in 2010 as compared to 2009, with only about a third re- porting improving mar- gins. There is no longer a clear distinction on margin trend based upon the size of distributors. After 20 consecutive months of de-
clining inventories, ASA members for the second consecutive month put ad- ditional inventory on the shelves by adding 1.0% of inventory as compared to 2009 but still have reduced by 11.3% as compared to 2008. Inventory turns are finally on the
rise and are beginning to improve, as 12-month sales growth now ex- ceeds the inventory increases. In ac- counts
receivable, days-sales outstanding have decreased by 2.0
days versus 2009. The trend of reduced head count has
stopped after two continuous years of decline. Again, for the sec- ond consecutive month, there was a growing move- ment of an equal number of distributors reporting an increase in employment as
those that reported reduced employ- ment against 2009. The PHCP industry recovery
seems to be trending positive and even gaining some momentum, as most distributors continue to report improved profitability as compared to 2009, when exactly the opposite was true. For a full report containing statis-
tical evaluation by regions of the country, market segments and distrib- utor size, companies should contact Chris Murin at
cmurin@asa.net or 312/464-0090, ext. 204.
•THE WHOLESALER® — FEBRUARY 2011
Stronger 2011
(Continued from page 26.)
away for a rainy day. A major reason may well be the re-
tention of the Bush-era tax cuts, and the unprecedented continuation of unemployment payments that has been legally extended for 99 weeks from the traditional 26. Although these factors face the U.S. with a na- tional debt that is escalating toward 100% of the annual gross domestic product, they are keeping the nation’s consumer activities at a world-lead- ing demand level, little different from that which existed before the reces- sion. After legislation passed during the
most lively Lame Duck session ever, due to the concentration of unfinished business before the election, con- sumer optimism is a sure bet to im- prove even further. With the continuation of the previ-
ous tax rates, the cut in the employee portion of the payroll tax, and the confidence of private businesses that further government encroachment will be restricted, the year 2011 will see business in general join the con- sumer in opening up their pocket books. My constant contact with over 100
of these businesses in the last month has ascertained that almost all of them enjoyed the strongest December activity they had ever seen. And this is true of manufacturers, distributors, retailers, and fabricators getting noti- fication that held-up projects are being readied for release. Unfortunately, jobs for the unem-
ployed and those entering the job market on a continuing basis will not put a dent in the current 26-plus mil- lion looking for full-time work on company payrolls. Since most of the long-term job seekers are concen- trated on the lower end of the unem- ployment pyramid, openings for the unskilled are not expected to open up under present circumstances. With hope for 2011 emanating
from more understanding govern- ment decision-makers, the best year since the start of the recession in 2008 seems to be on the way in 2011. To get the financial and economic
news on my daily blog, please log on to
www.theworldreport.org,
then
click the link to “Morrie’s Page” at
mydesert.com. Please recommend the blog if you find it informative. n
Morris R. Beschloss, a 55-year vet- See contact information on page 70 • Be sure to visit
www.thewholesaler.com for web exclusive articles and videos! •
eran of the pipe, valve and fitting in- dustry, is PVF and economic analyst emeritus for THeWHoLeSaLeR.
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