ASA Distributor Members Report Reported a Median Sales Growth Of Nearly 8% For July 2024 Vs. 2023

By primary business emphasis, the Industrial PVF firms continue to endure declining sales. Year-over-year monthly sales dropped -5% and their Year-to-Date (YTD) and Trailing Twelve Months (TTM) were down -7% and -6%, respectively. In contrast, PHCP and PHCP & PVF firms reported solid sales growth for July, with PHCP reporting sales that were up 11% and PHCP & PVF firms reporting a sales increase of 4%.

While some of this may be attributable to additional selling days in July 2024 vs. 2023, it is still an encouraging sign. On a month-to-month basis (July vs. June 2024), sales increased only 3% over a relatively soft June. With that being said, the solid July pushed the year-to-date (YTD) sales through July 31, 2024, vs. 2023 back to positive territory, increasing 0.8%. Trailing twelve months (TTM) sales were very similar, increasing 0.5%. Inventory increased 2.5% for July 2024 vs. July 2023.

Industrial PVF:

By primary business emphasis, the Industrial PVF firms reported that year over-year monthly sales declined by 4.8%. PHCP reported a huge sales increase of 11.4% and PHCP & PVF firms reported a sales decrease of 4.2%. All respondents overall reported a median sales growth of nearly 8% for July 2024 vs. 2023.

Economic Indicators:
The advance "Real" GDP growth figure for the 2nd quarter 2024 was released at a stronger than expected 2.8%--primarily due to higher consumer spending and inventory investment. Total wholesale sales for June increased 2.4% year-over-year, while inventories were essentially flat--rising a modest 0.1% vs. the prior year. The growth in "Real" wholesale sales came in at 2.0%--continuing the recent signs of inflation softening and that we remain in a disinflationary period. Housing starts and permits both decreased for July vs. June. Year-to-date single family starts and permits are both up vs. 2024. Multi-family is down significantly year-over-year. The unemployment rate for June edged up to 4.3%--the fourth consecutive month of increases. Despite the solid GDP figures, all indications are pointing to a rate cut by the Fed in their upcoming September meeting.

What ASA members are saying:

“Business was boosted by a very hot July plus 2 extra selling days. Business continues to hold up better than expected and we're watching interest/mortgage rates - if they were to fall, that would be an additional benefit.”

“Lower commodity prices, a strong labor market, and competitive pressures on gross margin are making this one of the most challenging and dynamic business environments seen since COVID.”

“Sales activity improved during July after several months of soft results relative to budget. However, with current interest rates and economic uncertainty, expectations and planning will remain conservative for the remainder of the year.”

“Sales improved from the prior month and from the prior year. Inventory is higher than prior year due to the current year forecast, steps are being taken to reduce the carrying value of inventory to match sales for this year.”

“We continue to see broad deflation amongst our products - this makes sales growth difficult, especially when combined with money being expensive and new construction slowing.”