Online Industrial Supplies Sales in the US Industry Market Research Report Now Available from IBISWorld

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The Online Industrial Supplies Sales industry has fared well over the past five years, despite a minor setback during the recession. Coming out of the recessionary low, the industry started to siphon sales from traditional brick-and-mortar stores, and will continue to do so through 2017. Competition within the industry will increase as companies use search engine optimization tactics to drive up traffic to their websites. External competition from mass merchandisers will threaten industry revenue, possibly hindering larger gains. For these reasons, industry research firm IBISWorld has added a report on the Online Industrial Supplies Sales industry to its growing industry report collection.

IBISWorld Market Research

IBISWorld Market Research

Despite a stumble during the recession, the industry has fared well in the years since 2007

Over the past decade, consumers and businesses have become increasingly more comfortable shopping online, and as a result, online retailers have seen their sales surge. The Online Industrial Supplies Sales industry has benefited from this migration and is expected to generate $4.9 billion in revenue in 2012. According to IBISWorld industry analyst Eben Jose, the online retail marketplace is one of the fastest growing industries in the United States, and as more traditional retailers (i.e. brick-and-mortar) have entered the online space to recapture sales taken by retailers that sell exclusively online, industry revenue has expanded even further. In the five years to 2012, IBISWorld expects industry-specific revenue to increase at an annualized rate of 6.7%.

While the industry has fared well recently, it did face some challenges immediately following the recession. The financial collapse and the recession that followed severely crippled the US economy. The rise in unemployment and decrease in disposable income forced many businesses downstream of this industry to cut back on production, thus decreasing industry revenue. Furthermore, the lack of available credit slowed industrial production at an average rate of 0.7% annually over the five years to 2012. Combined, these problems brought growth to a standstill in 2009, when industry revenue actually decreased 0.7%. Although the US economy remains sluggish, this industry has rebounded nicely as more downstream businesses shift purchases from brick-and-mortar retailers to online establishments to take advantage of industry's often lower prices. As a result, industry-specific revenue is expected to increase 10.3% in 2012.

The Online Industrial Supplies Sales industry will continue climbing over the next five years, and the return of US manufacturing and industrial production will only push growth further. IBISWorld estimates industry revenue will increase strongly over the five years to 2017. Additionally, the rising acceptance of online shopping will continue to drive growth over this period as it did over the past five years. The projected increase in companies will put pressure on profit margins as industry participants are forced to compete on price. Furthermore, the continued adaptation of the industry's external competitors is expected to threaten revenue over the period.

This industry is highly concentrated, in contrast to the brick-and-mortar marketplace, which is dominated by small, local mom-and-pop shops. IBISWorld estimates that in 2012, the top four firms in this industry will generate 81.3% of industry revenue. During the past five years, concentration has increased. The economic recession allowed the large operators to take market share from smaller players that had to scale back to adjust to slowing demand. “Major players achieved some resilience to economic downturns by vertically integrating with transportation industries that can better absorb high input costs, such as fuel,” said Jose. Through the recession, major player Grainger cut 600 positions in 2009 to counter falling sales but invested cash in expanding its product offering to remain competitive. It added sales representatives and expanded its product lines to provide customers a differentiated offer at a time when they needed easy access to a broad array of maintenance, repair and operations products. Meanwhile, some of the smaller players in the industry have exited the industry due to a higher sensitivity to economic conditions. For more information, visit IBISWorld’s Online Industrial Supplies Sales in the US industry report page.

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IBISWorld industry Report Key Topics
This industry sells industrial supplies primarily at the wholesale level where the majority of customers are manufacturers, contractors, warehouse operators and government entities. These products include abrasives, electrical products, tools and hydraulics. Some firms also provide industrial services. The industry does not include the online sale of industrial equipment, such as compressors, generators, power washers and scaffolding.

Industry Performance
Executive Summary
Key External Drivers
Current Performance
Industry Outlook
Industry Life Cycle
Products & Markets
Supply Chain
Products & Services
Major Markets
Globalization & Trade
Business Locations
Competitive Landscape
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
Major Companies
Operating Conditions
Capital Intensity
Key Statistics
Industry Data
Annual Change
Key Ratios

About IBISWorld Inc.
Recognized as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every US industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Los Angeles, IBISWorld serves a range of business, professional service and government organizations through more than 10 locations worldwide. For more information, visit or call 1-800-330-3772.

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Gavin Smith
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