Canadian Data for Canadian Electrical Marketers

Canadian Data
for Canadian Electrical Marketers
Coming together for new
benchmarking tools in Canada
What we know?
“…as we know, there are known knowns; there are
things we know we know. We also know there are
known unknowns; that is to say we know there are
some things we do not know. But there are also
unknown unknowns -- the ones we don't know we don't
know.
Pathfinder reports from the Distributor to the End user
EFED reports from the Manufacturer to the Distributor
Donald Rumsfeld From Department of Defense news briefing, February 12, 2002
Canadian Information first
Pathfinder
EFED
Industry input
Future Opportunities can include;
1. Market research by segment,
product, channel
2. Specific product opportunity
analysis
3. Competitive channel reviews
4. Help in Strategic planning
5. End user out reach
6. Lead Generation programs
7. Membership growth
WIN WIN approach
• EFED provides collective data (not
individual company data)
• Pathfinder extends beyond to those
who do not report
• Industry collaboration leads to
better data and better definition
• Canada Only focused data
• Findings are
– Channel is growing by its definitions and
business models
– 1000 branches analyzed
– More suppliers tracked than ever before
880 + based on line cards
Canada – US market Map
TOP 7 Distributors Share
71.20%
CANADA
33.27%
USA
36.21%
North America
0.00%
TOP 7 -Sales
ANIXTER
CED
GRAYBAR
HD SUPPLY
REXEL
SONEPAR
WESCO
10.00%
20.00%
30.00%
40.00%
50.00%
60.00%
70.00%
80.00%
The Branch footprint
CANADA ,
862, 16%
5500 branches in North
America
Canada has 16% of all
branches
USA,
4638,
84%
The top seven
distributors have 48.6
% of all branches in
North America and
55.4 % in Canada
CANADA
USA
North America
55.40%
47.11%
48.61%
42.00% 44.00% 46.00% 48.00% 50.00% 52.00% 54.00% 56.00% 58.00%
How do we compare to the US?
CANADA
USA
Canada - a New perspective
Electrical Channel by type of Distributor Canada
Independent
Branches
4 branches or
less
Geography
Regional
5+
local
More than 3
provinces
Multinational
10+
5+ provinces
Number
Branches
%
%
Branches Employees Employees
Square
feet
% Square
feet
204
20.4%
1,939
17.8%
1,047,665
17.4%
186
18.6%
1,954
17.9%
897,139
15.6%
610
61.0%
7,026
64.3%
4,076,261
70.8%
1,000
10,919
6,021,065
Source Pathfinder Research 2013
Defines the market: Full line Electrical wholesalers both members and non members
2013 review
2013 Flat to negative 1.6 %
2014 Flat
Full Line Electrical Distributors 83.3% of market
Total available market (TAM) $8.9 billion
$1.3 billion in retail, hybrid(catalogue)
Specialty channel on the rise
Have identified 30+ Utility supply businesses in Canada
Fastenal and Grainger increasing penetration in TAM
With Concentration of ownership will the next plays be
more regional/specialty
• Enter IMARK
•
•
•
•
•
•
•
•
•
Electrical -Economics 101
• June thru August were tough months
–
–
–
–
Quebec construction issues
Alberta projects off in electrical spend
Construction down 2%
Low volumes thru summer across all products
• ED Inventory at nominal level $1.4 Billion estimated
• Good news oil/gas but the related project capital spend is off and
maybe for a while yet
• Bad news is manufacturing is down and stagnant at best – this
could be the new reality here (-3% year over year)
• Business investment is also down ( the 5-7 year cyclical spend from
mining, forestry etc. has not offset)
• Our electrical take is flat through 2013 balance and 2014
Pathfinder Data
Industry Data
EFED Data
Private
confidential
sales data
Some regional
break outs but
limited
End user study
Company specific data
EFED Section
Data
Distributor specific data
Regional data
Private
confidential sales
data
Competitive
study
EFED data
Product mix
(basket) Line
CARD
Customer
data
Control , lighting,
wire, distribution
End User
database
Regional data
Branches,
footprint ,
employees
Process
• Branch by branch review includes;
– Line card – determines focus and product mix
skew ( lighting, control, wire etc.)
– Local market dynamics –determines potential,
market mix (Resi, Commercial, Industrial)
– Employee counts
– Facility size
The market as we see
it today
1.
2.
3.
4.
5.
Full Line distribution
Product Niche
Service product niche
Hybrids
Retailers selling
electrical
6. Other trade
7. Other channels
What we measure
Is the total served market
Canada Channel profile
• The average electrical distributor branch in
Canada is 5,993 square feet not including
outdoor storage space
• On average 10.8 employees work in every branch
in Canada up from 10.3 in 2012
• The median foot print per branch is 3,500 square
feet not including outdoor storage space
• The median employee size is 7
• The largest electrical equipment facility in Canada
is 240,000 square feet
Canada Total available market
Electrical Wholesalers – full Line
$6,230,565,000
2013 Percentage
Total Available
Market
69.9%
Speciality
$370,112,625
4.2%
Retail
$1,200,000,000
13.5%
Hybrid Distributors
$200,000,000
2.2%
2013
Catalogue Houses
TOTAL
0.0%
Datacom
$178,450,000
2.0%
Utility Distributors
$532,000,000
6.0%
Sales Direct
$200,000,000
2.2%
Other (HVAC, Industrial etc.)
$0
0.0%
$8,911,127,625
100.0%
Electrical Equipment at Retail
Estimated Sales of Electrical Equipment at Retail
Electrical Equipment representing 3% of total sales of $40 Billion
Estimated
sales
(Billions)
Market Share
Percentage
Lighting products
$0.90
75%
Other electrical (connectors, tools, wire, datacom)
$0.30
25%
Total
$1.20
100%
Source Pathfinder Research 2013
Sales of Electrical Equipment at Hybrid Distribution
Company
Acklands Grainger **
Fastenal
Canadian Sales
Branches
Canada
Electrical
Equipment
$1,000,000,000
175
$70,000,000
$224,050,750
194
$20,164,568
Total
Source Pathfinder Research 2013
* including electrical focused tools
** from 2013 annual report
$90,164,568
Hand Tools * Lighting
Motors
$70,000,000 $60,000,000 $20,000,000
$0
$0
$0
$70,000,000 $60,000,000 $20,000,000
Total served market
Table 7: Electrical Channel by Type 2013
Type
Full Line Electrical Distributors
Speciality
Utility including wire
Datacom
Other
Source Pathfinder Research 2013
Sales
$6,230,565,000
$370,112,625
$532,575,000
$178,450,000
$168,652,375
$7,480,355,000
2013 percentage of
market
83.3%
4.9%
7.1%
2.4%
2.3%
100.00%
Product Mix Canada
The Customer
Mix
Buy Specify, Install, Maintain
Driving more specific product
distribution
•
•
•
•
•
•
Lighting
Power Quality
Structured cabling
Utility
Energy management
Panel Building
Evolving business models
• Distributors providing in house
customization in panels
• Acquisition of aligned businesses in
HVAC, etc.
• Surplus
• Direct
New Buying teams that buy, specify
install and maintain electrical equipment
• Electrical Engineer
• Plant operations(MRO)
• Engineering
• Electrical maintenance
Market/Customer Mix Canada
Market Mix
Government
/other
22%
Customer Mix
Residential
23%
Other
including
Utlities
13%
Contracting
43%
Industrial
27%
Industrial
33%
Commercial
22%
Commercial/
Institutional/
Government
17%
The Electrical Contractor SNAPSHOT!
Small contractors
- Small firms 5 and less
employees
- Counter market
- Last minute /specific job
-
D
i
s
t
r
i
b
u
t
o
r
Why they buy
1. Ease of product installation
2. One stop shopping
3. Ease of handling
return/replacement
4. Location
5. Brand – manufacturer reputation
Large contractors
– 15 + employees
– Not typically counter traffic
1.
2.
3.
4.
5.
Why they buy
Product Quality
Availability at preferred Distributor
Familiarity with Brand
Manufacturer reputation
Warranty
Market Mix
How Do we compare to USA
Electrical Contractors
Contractors other than electrical
Commercial
Institutional
Industrial MRO
Industrial OEM
Factory Automation
Utilities
Retail
Retailers for resale
Government
Export
Other Wholesalers
Other ( farming, agriculture)
Total
Canada
39.9%
4.1%
7.9%
3.3%
15.2%
8.8%
3.9%
5.2%
1.5%
1.2%
4.2%
1.6%
1.5%
1.9%
100.0%
US
36.3%
4.2%
10.6%
3.5%
14.5%
9.0%
3.3%
5.5%
1.5%
1.4%
4.3%
0.5%
1.2%
4.2%
100.0%
Information platforms
WHERE THE ELECTRICAL INDUSTRY GOES FOR ITS INFORMATION NEED
The reach of the Business to business platforms
How often do you use the following information sources for electrical industry-related
content?
Websites
Print magazines
E newsletters
Print newsletters
OPT in Newsletters direct from supplier
Digital version ( 100% replication of print)
Social media
On line purchasing of electrical equipment
Mobile
Source Pathfinder Research 2013
Percentage of who use each
96%
91%
78%
50%
45%
31%
21%
19%
17%
Continuing Goals
•
•
•
•
•
•
•
•
Bring more Canada Specific data
Gain more insight
Drive collaboration
Channel Segmentation study in 2014 of specialty
and niche markets , control, utility, lighting
Close loop to understand end users
Support more marketing data
Develop more section support data to determine
new competitors
Help grow EFED membership and footprint
In closing
“…..so when we do the best we can and we pull
all this information together, and we then say
well that's basically what we see as the situation
that is really only the known knowns and the
known unknowns. And each year, we discover a
few more of those unknown unknowns.”
Donald Rumsfeld November 2002