HARDI: August wholesaler sales increase
Average sales among members of the Heating,
Airconditioning and Refrigeration Distributors International were up 7.9
percent in August compared with year-ago levels, the association announced.
While that was better than July’s 4.9 percent growth rate, a six-month decline in the annual North American distributor growth rate is continuing, HARDI said.
The figures come from its monthly Targeted and Regional Economic News for Distribution Strategies (TRENDS) Report, compiled by the Institute for Trend Research.
“The economy is in a definitive ‘phase C’ (slower growth) trend and so is the average HARDI member, but not without some positives,” said Andrew Duguay of ITR. “Looking at the latest data release, the ongoing improvement from 2010 sales numbers is encouraging to see despite its slowing rate. Another promising trend that has developed over the past three months has been the drop in days sales outstanding. The average day's credit sales in accounts receivable has fallen by an average of around 10 days since June - from 56 days to 46 days. Quicker payment turnaround leads to improved cash flow, something we can all appreciate and should be striving for in a phase-C economic environment.”
Three of HARDI’s eight North American regions showed double-digit growth.
HARDI Executive Vice President and Chief Operating Officer Talbot Gee said he was surprised by the figures.
“This might have been our Western region’s best month in about two years in terms of growth rate, and all of North America exceeded my expectation for what I saw as a challenging August,” Gee said. “But with impossible fourth quarter comparables to last year’s record months in November and December during the tax credit bubble, August sales up just 7.9 percent should signal distributors and their suppliers to prepare for a potential negative year-end growth rate.
“Despite eye-popping growth of R-22 unitary sales, overall unitary volumes are failing to keep pace with last year,” he said. “I fear we may have underestimated the R-22 impact, but over-estimated total unitary volumes for 2011 which is likely to depress distributor sales dollars and margins.”
While that was better than July’s 4.9 percent growth rate, a six-month decline in the annual North American distributor growth rate is continuing, HARDI said.
The figures come from its monthly Targeted and Regional Economic News for Distribution Strategies (TRENDS) Report, compiled by the Institute for Trend Research.
“The economy is in a definitive ‘phase C’ (slower growth) trend and so is the average HARDI member, but not without some positives,” said Andrew Duguay of ITR. “Looking at the latest data release, the ongoing improvement from 2010 sales numbers is encouraging to see despite its slowing rate. Another promising trend that has developed over the past three months has been the drop in days sales outstanding. The average day's credit sales in accounts receivable has fallen by an average of around 10 days since June - from 56 days to 46 days. Quicker payment turnaround leads to improved cash flow, something we can all appreciate and should be striving for in a phase-C economic environment.”
Three of HARDI’s eight North American regions showed double-digit growth.
HARDI Executive Vice President and Chief Operating Officer Talbot Gee said he was surprised by the figures.
“This might have been our Western region’s best month in about two years in terms of growth rate, and all of North America exceeded my expectation for what I saw as a challenging August,” Gee said. “But with impossible fourth quarter comparables to last year’s record months in November and December during the tax credit bubble, August sales up just 7.9 percent should signal distributors and their suppliers to prepare for a potential negative year-end growth rate.
“Despite eye-popping growth of R-22 unitary sales, overall unitary volumes are failing to keep pace with last year,” he said. “I fear we may have underestimated the R-22 impact, but over-estimated total unitary volumes for 2011 which is likely to depress distributor sales dollars and margins.”
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