MRO Magazine

PT distributor performance report reveals significant gap in profit margins among high-profit and typical firms

Chicago, IL -- The recently completed 2010 PT Distributor Performance Report reveals that high-profit distribu...

Chicago, IL — The recently completed 2010 PT Distributor Performance Report reveals that high-profit distribution firms had a pre-tax profit margin nearly five percentage points higher in 2009 than the typical firm’s pre-tax profit margin. The annual report, released by the Power Transmission Distributors Association (PTDA), demonstrates a wide variance in financial performance.

When asked in October 2008 to forecast sales for 2009, nearly one-third of distribution firms predicted sales declines. According to the 2010 PT Distributor Performance Report, the typical sales volume of power transmission/motion control distributors in 2009 was down 19.2%.

Gross margins for typical- and high-profit distribution firms showed little variance at 27.1% for typical firms and 27.4% for high-profit companies.

The median ‘high profit’ distribution firm (the top 25% of firms based on ROA) also diverged in other important ways from the median typical firm. The results suggest the most successful firms continue to exhibit critical profit variables well above those of the typical firm. Sales per employee at high-profit distributors totalled $554,771 in comparison to $384,819 for typical firms. Additionally, high-profit distribution firms kept operating expenses to 21.7%, whereas they crept to 26.3% for typical firms.


The PT Distributor Performance Report, conducted annually for PTDA by Profit Planning Group of Boulder, CO, is a compilation of operational statistics from 42 distribution firms throughout North America. The resource examines five-year distributor performance trends in return on investment, income statement, and balance sheet line items and examines financial ratios, asset productivity ratios, growth and cash sufficiency ratios and employee productivity ratios.

Data is reported for three US regions (Eastern, Southern, Midwest) and Canada, and four sales volume categories, ranging from less than $10 million to more than $75 million. Additional breakouts include machinery, repair and operations (MRO) emphasis versus original equipment manufacturer (OEM) emphasis and product mix (percentage of sales by bearings, power transmission and other).

The report is designed for distributors seeking information to benchmark their company’s performance against that of the industry as well as manufacturers looking to obtain insight into the operational and business needs of their distributors.

The report is available for purchase to PTDA members for $169.95 and to non-members for $299.95. For more information, contact PTDA at 312-516-2100 or visit the PTDA Store at