Some evergreen truths are tempering the impact of advances in communications and technology on the electrical industry.
I have been traveling a fair amount over the past few weeks, and while going through my notes from these business trips some interesting themes quickly surfaced.
In this age of social media, the personal touch still matters a lot
If you ever doubt this evergreen truth, go to the next Upper Midwest Electrical League in Minneapolis and see how electrical manufacturers and their reps work this show. According to the North Central Electrical League, which manages the event, 9,875 industry professionals attended this year's event to learn more about the latest in electrical products from the 439 electrical manufacturers in 341 booths. When it comes to marketing new products, all of the new-age page views, tweets and Facebook posts in the world pale in comparison to the age-old technique of simply getting a new product into the hands of a customer and letting them play with it, like they do every two years in Minneapolis at this event. Electrical manufacturers need to put the Upper Midwest Electrical League on their 2014 travel calendars: April 16-17, 2014.
Mobile interfaces to information on distributors' ERP systems are going to be hot, hot, hot
I was amazed at the turnout for a seminar held at the Epicor Insights 2012 users event in Las Vegas last month on Eclipse's new mobile interface for smartphones and tablets. It was standing-room only, and distributors had lots of questions about the features on the system, which included fingertip access to customer ordering trends and warehouse stock levels.
ESCOs aren't going away anytime soon
Love them or hate them, energy-service companies (ESCOs) have been part of the green equation for well over 20 years. Last month, I sat in on a seminar of dealing with ESCOs at the annual conference of the National Association of Electrical Distributors (NAED), in Washington, D.C., and came out of the session feeling like I had just left a time-warp.
Several distributors and one freelance writer spent the better part of an hour beating on ESCOs and ranting about how some of them steal customers and can't be trusted. I have been hearing stuff like this for almost two decades, and the truth of the matter is that working with ESCOs has always been a bit of a mixed bag for distributors, in that they can be good customers, fierce or unscrupulous competitors and — most often — something in between. What I found particularly interesting is that one distributor who attended the session currently has a good working relationship with a national ESCO, and he just sat there, comfortably mum, with the bemused expression on his face of someone who knows better.
While I will be interested in the findings of the study NAED is now financing on the role of ESCOs, I will bet you a banned 100W bulb that its conclusions will include at least a few of these themes: If you do dance with ESCO, be sure to choose your partner carefully; many ESCOs employ valuable engineering talent and have a total-building perspective on a job, rather than just focusing on the electrical systems; ESCOs are experts on the financing for big projects; and ESCOs' big niche is school and government jobs, with a heavy dose of Fortune 500 facility work. Some things just don't change.
LEDs have loads of potential but you can't yet dismiss traditional lighting systems
As you can read in our LightFair report on page 17, LEDs once again dominated LightFair. But the most interesting thing I saw or heard at the show in Las Vegas last month came from one marketing executive's evaluation of the current state of LEDs in the lighting industry: They are 90% of the talk, but so far only account for 10% of the sales.
The largest electrical distributors grabbed several more points of market share with some big acquisitions
In this issue's Top 200 coverage (page 20), you will see just how much the industry's largest companies have grown in the past year. While the economic recovery has been slow, particularly for those companies grounded in the nonresidential construction market, an awful lot of distributors saw growth in 2011 in the high single-digits, and the companies that made acquisitions supplemented their native growth with some sizeable additions in sales.
I think this issue of EW does a good job of exploring several of these issues. Read on and enjoy!