In a period of record level demand for freight services such as we witnessed earlier this decade, the last thing the industry needed was a global disruption to the pipeline of service parts and maintenance items.
But over the last few years, manufacturing suppliers, especially those who serviced both the OEM dealers and the independent distributors, were faced with a never-ending challenge when it came to order fulfillment. With order boards constantly exceeding capacity, it became a choice of which orders were shipped and which ones were delayed. Delivery dates were constantly changing and could easily be delayed weeks or months.
Fortunately, shortage issues seem to have cleared up in the last year. At the same time, freight demand has tapered off to a more “normal” pace. The challenge has become correcting and managing inventories that were either bloated from overstock or filled with parts that no longer had vehicles waiting for installation. Looking at supplier sales to each channel in the U.S. since 2021, it’s tough to say for certain if one was hit harder than the other and what the new normal will be going forward.
In December 2021, the combined total sales from 19 primary suppliers as measured by Aftermarket Index at MacKay & Company, had increased by nearly 15% over the prior year. Both the OES and independent channel sales were booming with double-digit growth in every North American region. Fast-forward a year to the end of 2022 and the story is similar with year-over-year growth in the U.S. up 14%. The channel splits also held their position from the previous year with the OES sales up by 17% and the independent distributors finished at +9.2%.
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