ASA distributor members continue to report large gains

ASA’s monthly sales report shows December 2021 results that reflect yet another month of strong performance compared to the same month a year ago.

The year-to-date and trailing 12-month figures remained strong when compared against 2020, a year that had multiple weeks, if not months, of closures or partial closures, ASA business intelligence partner Industry Insights, which produces the monthly sales report for ASA members, noted.

Respondents reported a median sales increase of 20.5% for November 2021 vs. 2020. In comparison to the previous month (December 2021 vs. November 2021), respondents reported a modest decline in sales of - 2.2% (the previous monthly sales report had a 3.5% increase in the same category; November 2021 vs. October 2021).

On a year-to-date basis, through the end of December, half the respondents reported sales growth over 19.1%, while half the respondents reported sales growth for the year (TTM) between 14.1% to 27.7%.

Inventory jumped 35% for December 2021 vs. December 2020. The median three-months average days sales outstanding dropped slightly to 40 days for December.

“It was another strong month in terms of year-over-year sales performance,” Industry Insights Senior Vice President Greg Manns said. “While it’s largely being driven by a weak 2020, it’s encouraging to see that nearly all respondents reported higher profitability for the year vs. 2020.”

Industrial PVF

Industrial PVF distribution firm respondents to the monthly sales report showed a median sales increase of 22.7% for November 2021 vs. November 2020. On a trailing-twelve-month basis, industrial PVF respondents reported a median sales increase of 24.2%. Inventory rose 37.5% for November 2021 vs. November 2020, while the three-months-average days sales outstanding declined to 48 for industrial PVF respondents.

Economic indicators

The advance “Real GDP” figure for the fourth quarter 2021 was reported at 6.9% growth. Total wholesale sales for November grew 23.3% year-over-year, while inventories grew 15.9% vs. the prior year. Housing permits and starts both recorded increases for the third consecutive month. The unemployment rate for December fell to 3.9% and initial claims for unemployment continued to decline, remaining below 300,000 for the third consecutive month — both figures again reached their lowest levels since the beginning of the pandemic.

What ASA distributor members are saying

Some comments from ASA member distributors that participated in the monthly sales report:

• “Business remains strong, although concerns about slowing growth seem to be creeping into more conversations. Supply as stabilized — not that it is good, but we have a better feel on lead times than previously.”
• “December was strong in the first half of the month, but slowed into the holidays and with the rise of COVID.”
• “Demand is still strong. We are worried continued price increases will eventually slow down demand.”
• “Despite supply chain and inflationary concerns and pressures, overall results for the month and year were better than the prior year.”
• “Ongoing staffing and supply chain challenges, combined with continuing price increases, could prove problematic in 2022.”