The road to healthy B2B sales through the first nine months of the year for manufacturers and distributors so far has been a good one.
But travel ahead could get bumpy and slow as fears of a possible recession and higher interest rates yet to come weigh on the minds of business buyers and sellers. And that will have a mixed impact on B2B digital commerce.
For the first nine months of 2022, total manufacturer and distributor sales totaled $11.103 trillion. That’s a 17.1% increase from $9.480 trillion in the first three quarters of 2021. For the third quarter ended Sept. 20, the combined sales of manufacturers and distributors grew year over year to $3.781 trillion. That’s up 15.2% from $3.283 trillion.
Both sets of numbers are based on monthly sales through August from the U.S. Department of Commerce and a projection by Digital Commerce 360.
“It is unusual to see positive economic indicators paired with historic labor and supply chain challenges, but this is the trajectory for U.S. manufacturing in 2022 emerging from the pandemic,” says Deloitte vice chair, industrial products, and construction leader Paul Wellener. “The recovery gained momentum in 2021 on the heels of vaccine rollout and rising demand. As industrial production and capacity utilization surpassed pre-pandemic levels midyear, strong increases in new orders for all major subsectors signal growth continuing in 2022.”
B2B sales remain robust, driven by more digital buyer activity
Total year-to-date sales are growing in large measure from the growing ranks of digital-first B2B buyers. Data from the latest B2B Buyer’s Survey from Digital Commerce 360 shows 40% of business buyers now purchase at least half of their organization’s goods and services on marketplaces. And 67.1% of buyers also are purchasing somewhat more, to significantly more, products on commercial and vertical industry marketplace platforms, the survey says.
As B2B buyers and sellers settle in for the fourth quarter, a slowing economy may stall growth in total sales. But many B2B sellers say business for digital commerce will remain brisk for the foreseeable future.
A case in point is Global Industrial Inc., which says more than half of all sales transactions are done online. The industrial and maintenance, repair, and operations (MRO) supplies distributor generated total sales of $298.5 million for the third quarter ended Sept. 30. That’s a 7.6% increase from sales of $277.4 million in Q3 2021.
“As we move through the quarter, the demand environment softened, a trend that has continued as customers have generally taken a more guarded approach to buying decisions, given the broader uncertainty in the market,” CEO Barry Litwin told analysts on the company’s most recent earnings call, according to a transcript from SeekingAlpha.com.
But the company also continues to expand ecommerce based on growing demand from customers.
“We completed the launch of our new digital ecommerce site,” Litwin said. “It includes enhanced functionality aimed at driving personalization of sales, marketing and merchandising offerings, which is an important pillar of our customer-centric strategy.”
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This content was originally published here.