NAED 2012 South-Central Observations

We just came back from the NAED South-Central in Orlando wanted to share our observations, in no particular order:

• The lobby seemed to be regularly packed, as was the 1st night reception (the 2nd night seemed to have 1/3rd the attendance of the first night as many were off to manufacturer dinners).  Reportedly the workshops were lightly attended and the general session speaker was good.  Unfortunately we didn’t get to the NAED speakers / sessions due to client and prospect meetings (which means we’re like many distributors and manufacturers – the need to generate a ROI for the meeting registration fee is greater than sitting in sessions that “may” have value.
• In the terms of a couple of manufacturers, the one-on-one area didn’t have any “energy”.  Many distributors were in manufacturer suites / meeting rooms throughout the meeting.
• Business sentiment is “decent”.  The construction market appeared to many to have a slight uptick, however, it is very geographically dispersed with major cities leading the way. The industrial market continues to be strong.
• Manufacturer sales seemed to be “all over the place”.  Some up and strong, some fair, some off.  No rhyme or reason.
• Some lamented that it seems like every distributor wants to get into the industrial market.  Many without experience (or minimal experience) are seeking industrial lines and market share … meaning bringing limited value-added to the marketplace and seeking to erode margins as they pursue sales (cashflow) and some margin dollars.)
• We had a number of questions regarding Crescent joining IMARK. Most came from manufacturers. Some had spoken to Crescent and were told that it was about getting to know distributors so they can make acquisitions (and IMARK asks members to consider selling to another member first – hasn’t been too successful of a strategy over the years as distributors seek to maximize their exit strategies.)  According to 2 manufacturers, IMARK distributors didn’t know about Crescent (they had to tell the distributors). Some commented about lack of transparency in decision making and reported some unrest.  We heard some comments about calls being made to AD (don’t know if true as no one would admit to making one.) And a few wondered why it seems like IMARK is growing for the sake of volume.
• Rexel continues to flounder.  Reportedly some received an email last week on 4 more branch closings, on top of what was closed in January.  Heard that there isn’t “brotherly love” between the two divisions – might have something to do with performance and job security!
• Heard of peripheral distributors looking to get into the electrical market.  Companies like Fastenal, Anixter, Motion Industries beefing up staff to become one-stop-shops to their customers.
• Lots of conjecture about the ABB acquiring T&B.  All talk as the deal won’t close till probably July and the sides can’t really talk at this stage (only the lawyers can!) Only thing guaranteed is status quo for now.  Lot’s of speculation of moves by others. Reportedly Rockwell asked distributors for advise and floated the idea of acquiring Cooper. Some thought Rockwell should by GE Gear. Some thought ABB should buy GE Gear (but GE may hesitate for strategic rest of world issues). Some think Cooper will going on buying spreee (and we know that ABB will look to make more acquisitions based upon public comments by ABB and we heard that T&B was looking at some deals prior to being acquired), and remember that T&B had eyes on Leviton for years (could they be an ABB target) and ….  Essentially no one knows but a chess game is one … it’s called electrical consolidation!

If you attended, your thoughts?