COVID-19’s Impact on Electrical Industry

David Gordon of Channel Marketing Group and DISC Corp.’s Christian Sokoll have launched a new series of bi-weekly surveys of distributors, manufacturers and independent manufacturers’ reps to find out how industry executives are managing their way through this crisis.

They provided Electrical Marketing with an executive summary of the survey for this issue. The full survey is available for $50, with $25 going to the Gary Sinese Foundation, a nonprofit organization that supports wounded military veterans, first responders and their families. To get a copy, contact Gordon at [email protected].

The first survey, which was out in the market from March 16 to March 27, attracted 429 responses, with 61% of the respondents being electrical distributors; 24% independent reps; and 14% manufacturers. It found that during this time frame the electrical distribution channel is down -10% in total, with the steepest performance declines in the East and in metropolitan areas.

“The West Coast has already lost a lot of traction,” Gordon and Sokoll said in their analysis of the impact on distributors. “Washington and California have some of the more restrictive quarantine actions over the past two weeks, forcing the setbacks to skyrocket.

“These actions will grow nationally as states shut down more activities. The impact on New York is expected to accelerate with construction (in some cases) being stopped March 27. Pennsylvania has also stopped construction activities.”

Key electrical distributor concerns that surfaced in the survey include cash flow, access to capital and the well-being of their employees. Gordon and Sokoll said in their executive summary that manufacturers expressed the most concern about the duration of the virus and sales forecasting.

Manufacturers reported some steep declines, with 40% of respondents reporting that their business is down -10% or more. Half of the manufacturers surveyed said they had already experienced supply chain disruption.

Independent manufacturers’ reps reported deep and immediate impact on their sales, particularly in the East, with 63% of respondents reporting sales declines of more than -21%. Rep respondents from other areas of the country reported smaller but still significant declines, with 38% of reps in the South or Southwest having sales declines of more than -21%; 28% of Midwestern reps seeing declines over that figure; and 31% of West Coast rep respondents seeing sales decline more than -20%.

The survey results are also loaded with insight into the actions distributors, reps and manufacturers have taken during the early innings of this crisis. For just $50, it’s a bargain for any industry executive.