Lonestar & ABB Gear Up in Texas

As a start-up electrical distributor, founded in 2014, Lonestar Electric Supply has had a meteoritic rise in sales. The company has grown from $0 to $405 million as of the end of 2021 and is now ranked #27 according to Electrical Wholesaling.

And the amazing part is that they did this without a switchgear line.

It did help that the company was founded by industry veterans who were well financed and had extensive supplier, agent and contractor relationships in the market.

For years they tried to recruit a distribution equipment line as well as join a marketing group. For various reasons both paths were “inhibited” by others in the local market.

But the stars have aligned.

Earlier in the year Lonestar joined IMARK Electrical.

Now the company will be representing ABB Electrification.

A recent press release shared on June 7th:

Lonestar Electric Supply and ABB Electrification enter authorized distribution agreement

“Today Lonestar Electric Supply, one of the largest electrical distributors in Texas, announces an authorized distribution agreement with ABB Electrification. Established in 2015, Lonestar has seen tremendous growth since inception. ABB will now be the single- line electrification equipment provider for Lonestar at all five Texas locations.

Lonestar Electric Supply is owned and operated by experienced leaders with a proven track record of success in the electrical industry. Providing value to customers through differentiated services and employee development and wellbeing are the cornerstones of our business. “ABB’s history of technological innovation, robust electrification portfolio and customer-centric approach makes them the perfect partner in our mission to provide the best service and support to our customers,” said Jeff Metzler, Lonestar Electric Supply CEO.

Since 2018, ABB Electrification has invested nearly $3 Billion in the U.S. commercial, industrial, and residential electrical market, including the acquisition of GE Industrial Solutions as well as investments in product development and expanded production facilities.

Lonestar Electric Supply looks forward to a successful relationship with ABB Electrification.”

Given that the distribution segment of the business can represent 10-15% of a distributor’s sales, this can be another significant accelerator for Lonestar.

Thoughts

So, why “now” for ABB? While no one is talking, some possibilities include:

• Enough time has passed since the founders of Lonestar founded Lonestar?
• Lonestar “wore down” ABB?
• In evaluating the Texas market, which has grown significantly, ABB decided it needed another, or a stronger, or “a” partner in key markets. Since Schneider and Eaton were probably risk adverse given their national chain relationships, that left the alternatives being ABB and Siemens. Maybe Lonestar pursued one versus the other or ABB was more “receptive” to Lonestar’s outreach … or perhaps ABB recognized a share-taking opportunity?
• Perhaps Lonestar developed a growth / investment strategy that appealed to ABB?
• Or Lonestar worked the contractor market to solicit support for them and brought that to ABB … and maybe with some potential business?
• Or maybe there was no downside for ABB?

With no one talking, at least openly, it could be one, all, some or none of these reasons. Maybe the stars did align.

Two things we know are in Lonestar’s future …

1. Lots of training (product and systems)
2. Much new business!

Congratulations to Lonestar on securing ABB Electrification as their distribution equipment line (and they are single source) and congratulations to ABB Electrification for partnering with a fast-grow distributor in a growth market.

And a takeaway … persistence, and patience, can pay off.