The Big 50 and overseas business
Jack Keough, Editor/Associate Publisher -- Industrial Distribution, 6/1/2006
In this issue (p. 30), we once again present Industrial Distribution's Big 50, the annual listing of the largest industrial distributors. Traditionally, this is one of our best-read articles—more than 125,000 people clicked on to our Web site to read the Big 50 last year.
There are several new entrants on the list this year, and it will change again next year due to several mergers and acquisitions that have already occurred. Change certainly is in the air. In reviewing this listing, what stands out is the number of companies that have established, or will be establishing, an international presence.
Several of these distributors have opened in various parts of the world. Fastenal and Grainger have branches in China, and other companies are expected to follow. Others have partners in Mexico, South America and Central America.
U.S.-based power transmission distributors have been slow to open such branches, but that may be about to change. The president of one of our Big 50 distributors, in fact, predicted that may be imminent.
We've heard time and time again that we live in a global economy. Evidence of that has clearly mounted in the past several years. Where a distributor once sold only in a geographical region, ease of shipping goods has expanded the reach of most companies.
For example, at the recent Bearing Specialists Assn. meeting in Sarasota, Fla., a panel discussion focused on world business. The discussion clearly showed the impact of international business.
Peter Negri of Jamaica Bearings, who moderated the panel, pointed out that 60 percent of BSA distributors ship internationally, while their manufacturing counterparts have 120 manufacturing plants located outside the United States—a number expected to climb.
It used to be that Mexico was a haven for manufacturing. Today it is China and India, and some manufacturers tell us they're looking to Vietnam or Africa for future growth.
During the discussion, panelists were asked why they had located overseas. One panelist answered succinctly and to the point: "For a manufacturer, you must (locate in other countries)."
Others pointed out that, "The domestic market is not big enough," while still others chimed in that, "There are no borders where our customers are."
Where are your customers?
View All Blogs
