Two of the largest independent electrical distributors remaining in the Northern California market are joining forces to gain a larger footprint and economies of scale. Electrical Distributors Co., based in San Jose, Calif., and Granite Electrical Supply, based in Sacramento, have merged under the name Edges Electrical Group.
The new company will have 11 locations with headquarters in San Jose, but will preserve the existing brands in the local markets, said John Russ, marketing manager. The combined company will continue to be led by Scott Lehmann from Electrical Distributors and Bob Powers from Granite Electrical Supply, though Russ said their titles and the top management structure are still a work in progress.
For two companies that have operated in neighboring markets for many years, there’s a remarkable lack of territorial overlap. Electrical Distributors has served the San Francisco Bay area for four generations, having been started by Tyke Lehmann in the 1940s. Granite Electrical Supply was started by Bob Powers and the Flynn and Russello families in 2003 to serve the Sacramento Valley and markets as far east as Susanville. Granite’s owners had previously built Pacific Electric Supply in Sacramento and sold it to Rexel in 1997, then started Granite after the expiration of a five-year non-compete agreement.
By setting up to serve both the Bay Area and Sacramento Valley markets, Edges Electrical Group is largely following moves by its customers, Russ said. “The market in Northern California has become sort of globalized over the past few years, with contractors who used to work just in the Bay Area starting to cross over inside the state and in some cases out of state, while contractors in the Sacramento Valley are now doing more work in San Francisco Bay area.”
Already the cross-pollination between the companies has begun, combining Granite’s experience serving large contractors and its strong solar market presence with Electrical Distributors’ expertise in serving small to mid-size contractors, Russ said.
Electrical Distributors is the larger of the companies by sales volume. It ranked at #99 on the 2014 Electrical Wholesaling Top 200 list of the largest electrical distributors, putting its annual sales somewhere around $70 million. Granite Electrical Supply was on the 2014 EW Top 200 list at #113, so sales were somewhere in the neighborhood of $58 million. (Neither company provided sales figures for publication in the list.) As a combined company, Edges Electrical Group would rank somewhere in the low 60s on the list based on 2014 sales.
The Northern California electrical market has seen some big moves in consolidation and acquisitions of independents over the past three to four years. Notable deals include San Francisco-based Plough Electric Supply’s acquisition by Buckles Smith, San Jose, last year; Central Wholesale Electrical, Livermore, Calif., being acquired by Alameda Electrical Distributors, Hayward, Calif., in 2011; and the blockbuster acquisition of Independent Electric Supply, San Carlos, Calif., by Sonepar USA the same year.