Industrial Distribution Continues to Consolidate

By Eric Lanke
NFPA CEO

I recently wrote about the NFPA/FPDA leadership meeting we conducted at the recent FPDA Annual Conference in Florida. My attendance there allowed me to spend some time at the FPDA meeting, networking with their members (many of whom are also NFPA members) and listening to the presentations delivered from their podium.

One presentation I found particularly interesting was on the on-going impact of consolidation in the industrial distribution market. The presenter shared data that showed the top ten industrial distributors have gone from 18 to 29 percent market share in the past 10 years. That’s quite a trend.

But more interesting to me was what some of those large companies were doing to continue growing their market share. According to the FPDA presenter, they’re increasingly targeting small and medium-sized customers with technical and value-added services. They’re adding more sales people at the local level, especially those with technical expertise, and they’re investing in new metalworking and manufacturing capabilities to better support those activities.

I found it an interesting comment on the continued evolution of the industry towards more applied engineering and system integration as a competitive differentiator.