PAR Report Shows Slight Increase in Distributor Profit

Electrical distributors' profitability increased by 0.8 percent in 2004, according to the recently released National Association of Electrical Distributors (NAED) 2004 Performance Analysis Report (PAR) highlights.

The electrical distribution industry showed improved financial performance for the third consecutive year, according to the report. As a benchmark for electrical distributor operations, PAR results profiled in the report are based on financial survey data of 166 participating NAED distributor members throughout the United States.

Distributor's net profit margins grew from 1.3 percent in 2003 to 2.1 percent in 2004. Although margins have increased during the last three years, this level was last achieved in 1997. Profit margins for “high profit” distributors increased from 3.5 percent in 2003 to 4.6 percent in 2004.

PAR highlights include a five-year trend of key ratios. Additional data revealed increases in sales volume, return on net worth and inventory turnover. For example, sales growth for the “typical distributor” showed an increase in 2004 of 16.5 percent compared to 2.3 percent in 2003 data.

For more information on the PAR Highlights, contact NAED customer service at (888) 791-2512 or e-mail at [email protected].

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