As industrial activity stabilized and prospects for a demand recovery emerged, particularly post elections in 2016, the distribution industry recovered, with sales for U.S. wholesale distributors growing 7.6% to $5.7 trillion last year, according to Modern Distribution Management. Thanks to the tailwinds of tax reform and steadily increasing industrial activity, this momentum has continued into 2018.
Against this backdrop, the highly fragmented distribution industry has seen an uptick in consolidation activity since mid-2017, as companies are increasingly using M&A to expand their geographic reach, adapt their product and service offerings in response to evolving customer demands, and strengthen their digital capabilities. As a result, M&A in the distribution industry has become a decidedly seller’s market, with buyers aggressively pursuing targets for both offensive and defensive reasons.
We examine three main trends that are driving much of the acquisition activity in the distribution industry and look at how companies can maximize their strategic value in today’s dealmaking landscape.
Highlights include:
- Amazon B2B 3.0: Assessing the threat to industrial distributors
- Consolidation accelerates in a fragmented industry
- Pressure rises to embrace technology
- How industry leaders are navigating a rapidly changing landscape
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