Lighting Continues Its Comeback in Q4

Last month we solicited the electrical / lighting channel’s input on the lighting market during the fourth quarter. And the market continues to rebound.

After a strong Q3 as reported in our Q3 Pulse of Lighting Report, Q4 showed continued improvement, helping the year end on a positive lighting sales note.

While Acuity shared in their recently quarterly performance that “agency” (essentially “channel”) sales were down 3%, key highlights from our Q4 Pulse of Lighting Report conducted in collaboration with William Blair show:

• Sales were essentially flat vs 2019 with ranges ranging from -5% to flat depending upon reporting audience (with distributors reporting flat, but it is important to recognize that manufacturers and distributors are based upon COGS whereas distributors are based upon sales dollars … the difference being distributor margin).
  • 35% of reporting manufacturers reported flat sales and some reported increases.
• The market remains focused in the renovation area and then small to mid-sized jobs. The large construction market remains “challenged”.
• Brand names appear to have picked up some share, especially with their “contractor” branded products.
• Inventory and backlogs are pretty much flat.
• COVID is impacting jobsite staffing and delaying projects. 83% of reporting manufacturers stated that they have had at least 1 project delayed due to COVID in the fourth quarter. 71% of reps shared that they have had at least 1 project delayed.
• Supply chain disruptions were reported for raw materials as well as finished goods materials.
• Competitive pricing market with tier 3 suppliers, Cooper Lighting Solutions and Acuity taking the lead although Cooper and Acuity have been targeted in their efforts.
• The outlook appears to be bright, however, there is concern for Q1 due to project delays caused by COVID. The second half of the year is projected by many to be strong assuming a vaccinated marketplace. Marketplace projections for next quarter and the year are in the report. By end of the year, low to mid-single digit growth is expected.

Each audience also shared their insights regarding the marketplace, Q4 pricing trends and quotation activity looking out into 2021 by quarter.

The report is available for $29. Order here or email us.

Over 225 electrical / lighting distributors, manufacturers and manufacturer reps / lighting agents contributed to the survey. Survey participants had the opportunity to receive a free copy of the report.

Overall, the lighting market continued to grow. While new construction and sales visits is a challenge, opportunities still abound and distributors are capitalizing upon opportunities.