|Last Quarterly Update:||11/4/2013|
|SIC Codes:||50 , 51|
|Industry Overview||Trends & Challenges||Industry Forecast|
|Quarterly Industry Update||Call Prep Questions||Website & Media Links|
|Business Challenges||Financial Information||Glossary & Acronyms|
Companies in this industry serve as wholesale distributors of nondurable or durable goods, typically specializing by product. Major US distributors include SYSCO (foods); McKesson (drugs); and Avnet (electronics). Top companies based outside the US include Switzerland-based pharmaceutical distributor Alliance Boots, Taiwan-based components wholesaler WPG, Japan-based medical products distributor Mediceo, Brazil-based petroleum products wholesaler Petrobras, and Germany-based chemical distributor Brenntag.
Many wholesalers approach new foreign markets through partnerships or acquisitions. Emerging markets such as China, India, Brazil, and Russia will only grow in importance to wholesalers.
The wholesale distribution industry in the US includes about 300,000 companies with combined annual sales of about $6 trillion.
For most distributors, demand is closely linked to local economic activity. The profitability of individual companies depends on efficient inventory management and order fulfillment operations. Large companies can supply customers with a wider range of goods and in more markets, but smaller distributors can compete successfully by carrying specialty products or providing add-on services. In the US, the industry is highly fragmented: the 50 largest distributors generate about 25 percent of industry revenue.
Computer and communications technology have had a major effect on the industry by improving the efficiency of warehouse and distribution operations. Largely because of automation, industry labor productivity improved more than 30 percent between 2001 and 2011.
Supply chain efficiencies allow some manufacturers and retailers to bypass independent distributors. Manufacturers account for nearly 30 percent ...
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