Canadian Electrical Wholesaler

June 24, 2020

April Wholesale SalesAs the effect of the COVID-19 pandemic continued to spread throughout the economy, wholesale sales plummeted an unprecedented 21.6% to $49.8 billion in April, the lowest level since July 2013. All seven subsectors recorded lower sales for the first time since November 2008. In dollar terms, the motor vehicle and motor vehicle parts and accessories subsector contributed the most to the decline. Excluding this subsector, wholesale sales were down 14.2%. 

Wholesale sales volumes dropped 21.5%, a record monthly decline, to their lowest level since September 2009.

COVID-19 impact in April

Respondents reported that the COVID-19 pandemic pushed sales $16.9 billion (unadjusted) lower in April, with four-fifths (79.5%) of wholesalers reporting an impact to their business.

The motor vehicle and motor vehicle parts and accessories subsector recorded the largest dollar-value impact from the COVID-19 pandemic in April, down $5.4 billion (unadjusted). Many of these companies noted that COVID-19 caused manufacturing stoppages, dealership closures and disruptions in consumer demand. 

Over nine-tenths (90.1%) of wholesalers in the personal and household goods subsector reported that their businesses were affected by COVID-19, the highest proportion among all subsectors for a second consecutive month. Respondents in the subsector reported that the COVID-19 pandemic resulted in $2.6 billion (unadjusted) of lost sales in April, led by the textile, clothing and footwear industry (-$943 million, unadjusted). Respondents in the industry indicated that the lower sales volumes were mainly attributable to retail closures. 


Lower sales driven by motor vehicle industry

With the Canadian motor vehicle industry highly reliant on motor vehicle imports, the widespread shutdowns in motor vehicle manufacturing throughout the world and a reduced demand due to the pandemic, continued to impact wholesale sales in April. The motor vehicle and motor vehicle parts and accessories subsector fell for a second consecutive month, dropping 64.7% to $3.3 billion—eclipsing the previous month's record decline of 21.7%. While all three industries in the subsector recorded declines in April, the motor vehicle industry accounted for about 90% of the decrease; sales in the industry were down 74.8% to $1.8 billion, their lowest level since March 1993.

Sales in the personal and household goods subsector recorded a second decline in three months, dropping 21.5% to $7.7 billion in April. While all six industries posted lower sales, the largest drop came in the pharmaceuticals and pharmacy supplies industry (-22.9% to $4.5 billion). Widespread declines were also reported in the building material and supplies subsector, resulting in a record 22.2% decline in sales to the lowest level since June 2013. 

While all seven subsectors recorded lower seasonally adjusted sales in April, there were some sub-industries where sales increased on an unadjusted basis in April, including nursery stock and plants, alcoholic beverages, cigarettes and tobacco, and a handful of agriculture-related sub-industries. 

Ontario leads April declines

Nine provinces recorded lower sales in Canada, with Ontario posting the largest drop. Saskatchewan recorded the only provincial increase.

Sales in Ontario were down 30.2% to $23.0 billion in April, following a 4.2% decline in March. Every subsector in the province had lower sales, with the majority of the decline coming in the motor vehicle and motor vehicle parts and accessories subsector, falling 85.7% to $930 million. Excluding the motor vehicle and motor vehicle parts and accessories subsector, provincial sales declined 16.6% in April.

Sales in Saskatchewan rose 1.6% to $2.3 billion, following a 6.8% increase in March. Higher sales were recorded in four of seven subsectors, led by the machinery, equipment and supplies subsector, up 5.0% to $653 million. The sole increase in this subsector was observed in the farm, lawn and garden machinery, equipment and supplies industry.

Wholesale inventories rise

Wholesale inventories increased 1.2% in April to $93.0 billion. Five of seven subsectors recorded gains, accounting for more than half of total wholesale inventories.
The personal and household goods subsector led the gains in April, with inventories rising 6.9% to $17.0 billion. While three of the subsector's six industries recorded higher stock, the pharmaceutical and pharmacy supplies industry rose the most (+15.0% to $7.7 billion). With most retail stores closed as a result of the pandemic, wholesale companies in the textile, clothing and footwear industry saw their inventories rise as they were unable to move product.

Following an increase to 1.45 in March, the inventory-to-sales ratio jumped to 1.87 in April, the highest value on record, as all subsectors experienced gains. The motor vehicle and motor vehicle parts and accessories subsector contributed the most to the rise, as its inventory-to-sales ratio climbed from 1.38 in March to 3.83 in April.

Looking forward: Impacts of COVID-19 on wholesale trade in May 2020

Statistics Canada remains committed to providing an accurate picture of the social and economic impacts of COVID-19.

As the largest component of Canada's service sector, wholesale trade impacts the whole economy, while acting as the "invisible" intermediary.

May marks the second month of widespread lockdown and it is anticipated that reported impacts on businesses for the month will not be as severe as seen in April.

The motor vehicle industry faced another difficult month as the widespread global manufacturing shutdowns continued and production did not begin to resume until late May or early June. While Ontario dealerships were given the green light to reopen on May 4, by appointment only, market analysts anticipate another decline in May, but one that is far less pronounced than April's record-setting drop. 

In addition, an increase in May employment for the wholesale and retail trade sector, as shown in the Labour Force Survey, and the appreciation of the Canadian dollar are providing some evidence that the Canadian economy may have started the slow road to recovery.


Source: Statistics Canada, www150.statcan.gc.ca/n1/daily-quotidien/200618/dq200618a-eng.htm

 

           Partnering For The Next Step                

Siemens CanadaWelcome to the Digital Enterprise Virtual Summit brought to you by Siemens

How quickly can you react to changing conditions and demands in your market? How can you ensure your production will run securely at any time in the future?

Industry’s digital and technological transformation is the answer for meeting today’s and tomorrow’s challenges and market needs.

With the right digitalization and automation solutions, expertise won from practical experience, and a partnership approach that benefits all involved parties.

To explore these possibilities, we’re bringing together top-level speakers, specialists and decision-makers from various industries and experts from Siemens

to the Digital Enterprise Virtual Summit under the motto “Partnering for the next step.”   

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“Re-envisioning Electrical Switchboards”: For light commercial applications, the status quo is no longer enough

Eaton 175x125Whether you’re a contractor or consultant, compact footprint and shorter lead times are a priority. At Eaton, we understand these challenges. That’s why we have re-envisioned our traditional electrical switchboard to assess how it could better serve light commercial applications. The result? The Pow-R-Line CS. 

Join Eaton’s webinar on June 30th, 2020 and learn the secret to shorter lead times alongside the additional benefits of:

 -  Versatile Configuration - Cost Effectiveness - Plus a Complimentary 3D Product Demonstration!

Sign up and join our host Annu Yadav - Distributor Programs Manager and our presenter Aditya Ramesh - Product Manger of Panelboards & Switchboards. Looking forward to seeing you there!

Click Here To Register.

 

John JefkinsBy John Jefkins

In 2011, I started working in the electrical arena and quickly noticed that there was a high employee retention rate within the industry. Today, I regularly engage with Electro-Federation Canada members with 20, 30 and even 40 plus year tenures. Other industries I had worked in previously, such as telecommunications, had higher turnover rates.

Our industry faces an increasing need for talent, with new retirements and product/process innovations and modernization driving the need for specialized roles — some not even known yet.

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Digital Twin MarketA recent Markets & Markets report estimates the Digital Twin market will grow from US$3.8 billion in 2019, to US$35.8 billion per year by 2025, at a CAGR of 45.4%. Digital Twin software is already revolutionizing industries such as healthcare, architecture, aerospace, defence, and automotive and transportation.

Furthermore, the global smart infrastructure market, which includes the Digital Twin sector, is expected to thrive at a considerable CAGR between 2020 and 2025 as demand for the smart infrastructure has been a booming year on year, reports Market Research Explore - details. 

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PNNL StudyBy Craig DiLouie

The U.S. Department of Energy has released the results of a study examining authentication vulnerabilities in connected lighting systems (CLS). Particularly as emerging CLS incorporate distributed intelligence, network interfaces and sensors, they can serve as data-collection platforms that enable a wide range of valuable new capabilities as well as greater energy savings in buildings and cities. However, CLS technology is currently at an early stage of development, and its increased connectivity introduces cybersecurity risks that are new to the lighting industry and must be addressed for successful integration with other systems.

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David GordonBy David Gordon

COVID-19 has heightened the benefit of, and interest in, eCommerce for electrical distributors. Our second and third COVID-19 Electrical Market Sentiment Reports have shown that those with an eCommerce offering have seen online sales increases. Further, from conversations with distributors, their site activity increased. The benefit is that these companies had lower sales declines (and some increases), and were able to better serve their customers.

A further benefit is that their remote workforce had access to an online resource, other than manufacturers, for quick, easy, product research.

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2020 q2 Pulse of Lighting FindingsChannel Marketing Group’s 2020 Q2 Pulse of Lighting Report projects that the lighting market, through electrical distribution, contracted by 20%.

The survey, conducted the third week in June, received responses from 164 individuals who equally represented industry stakeholders.

Distributor Performance
Very few distributors reported either flat or positive performance with over 30% reporting declines of over 30% for the quarter.

 

 

 

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EikoEIKO has announced the the introdutction of EiKO Marketplace, a digital storefront, located in the EiKO Portal. Developed to market and sell promotional specials and excess inventory including generational, overstock, and niche products; the EiKO Marketplace presents an opportunity to offer high-quality lighting at incredible savings.

Due to the rapid development and generational changes of LED technologies the timing is perfect to launch the EiKO Marketplace as an outlet to sell high quality, value-priced products.

 

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LevitonLeviton Canada is pleased to announce the nomination of Thomas Supinski as Sales Director for Alberta and the Prairies as of June 1st, 2020, as Julie Marineau will be moving to Montreal along with her family. Julie will be promoted to Vice-President, Retail at Leviton Canada’s head office.

Thomas has been residing in Calgary since 2003 and has a deep understanding of the regional market and its specific needs.

 

 

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Peers & Profiles

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With over 60-years of experience in the lighting industry, CBC Lighting has established itself as a ...

 

Anju UddinBy Blake Marchand

Sonepar is excited to introduce Anju Uddin as the new Marketing Manager for their Ontario Region! Anju has more than 15 years of experience as a marketing expert, which includes running an independent agency working with a multitude of businesses in various industries and geographies from around the globe. 

With a passion for reinvention and finding success through a commitment to education and innovation, Anju has utilized her exceptional creativity and business acumen to engineer seamless brand experiences...

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