Specialty Distribution Industry Update Q4 2023

Read more about M&A activity and trends in this sector

Specialty Distribution Industry Update

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U.S. Specialty Distribution Market Insights

The specialty distribution sector continues to be positively impacted by improved U.S. manufacturing activity, improved supply chain conditions and logistics activity, and a sustained increase in onshoring investment.

Current Trending Legend


Logistics Activity

Current Trending:

  • Logistics Managers’ Index (LMI), which gauges the health of the logistics industry, slightly decreased to 49.4 in Nov-23 
  • The recent dip is attributed to a slowdown in warehousing and transportation utilization
  • Further, decreased inventory levels due to Q4 holiday sales and higher inventory costs contributed to the decline
  • The decline in Nov-23 is anticipated to be seasonal and temporary

Logistics Managers’ Index (LMI)

Manufacturing Activity

Current Trending:

  • U.S. manufacturing activity remained resilient over the last  year on account of new orders and backlog, and decreased prices
  • The ISM Purchasing Mangers’ Index (PMI), which measures the manufacturing sector performance, slightly decreased to 46.7 in Nov-23, though is relative unchanged since Nov-22
  • Stabilization of the PMI indicates positive momentum across  the sector

Purchasing Managers’ Index (PMI)

Onshoring Activity

Current Trending:

  • Onshoring investment is a leading indicator for distribution activity
  • Companies continue to drive onshoring efforts to enhance domestic U.S. production
  • Drivers of growth include supportive government initiatives and incentives (Inflation Reduction Act, CHIPS act, etc.) and uncertainties stemming from geopolitical tensions such as the Russia-Ukraine conflict and U.S.-China trade relations

Job Announcements (Reshoring & FDI)

Specialty Distribution Overview

Specialty distribution industry participants include distributors and suppliers of specialty products and parts covering a variety of end markets. Key public industry players are categorized by sub-sectors as follows:
Sub-sectorMean Public Trading Multiples(1) Description of Business PlatformKey Select Industry Leadership
AutomotiveTEV / LTM Rev: 2.26x
Omni-channel suppliers of aftermarket parts and accessories
  • AutoZone
  • Dorman Products
  • Genuine Parts Company
  • LKQ Corporation
  • O’ Reilly Automotive
Building ProductsTEV / LTM Rev: 1.17x
Providers of data, analytics, and business information services
  • Adentra
  • Beacon Roofing Supply
  • Boise Cascade
  • Builders FirstSource
  • CRH
  • Ferguson
  • GMS
  • SiteOne Landscape Supply
Consumer ProductsTEV / LTM Rev: 2.20x
Distributors of specialty residential products
  • Central Garden & Pet Company
  • Fortune Brands Innovations
  • Pool Corporation
Food ServicesTEV / LTM Rev: 0.45x
Suppliers of food and non-food products to restaurants, hospitals, and schools and universities
  • Bunzl
  • Performance Food Group
  • SpartanNash
  • Sysco Corporation
  • United Natural Foods
  • US Foods Holding
HealthcareTEV / LTM Rev: 0.50x
Providers of pharmaceuticals, medical supplies, equipment, and devices
  • AdaptHealth
  • Cardinal Health
  • Cencora
  • Henry Schein
  • McKesson
  • Owens & Minor
  • Patterson Companies
IndustrialTEV / LTM Rev: 1.77x
B2B distributors of products, equipment, and supplies across a range of industrial applications
  • Applied Industrial Technologies
  • DXP Enterprises
  • Fastenal
  • Global Industrial
  • Kaman Corporation
  • L’Air Liquide
  • MRC Global
  • MSC Industrial Direct 
  • NOV
  • NOW
  • Rexel
  • SPX Technologies
  • W.W. Grainger
  • Watsco
  • WESCO International
Speciality ChemicalTEV / LTM Rev: 3.41x
Suppliers of smaller volume chemical products used in specialty applications
  • Air Products and Chemicals
  • Brenntag
  • Hawkins
  • IMCD
  • Linde
Source: Market statistics sourced from Capital IQ and based on 12/31/2023 Market statistics sourced from Capital IQ. Industry data sourced from publicly available information



1. Valuation Multiples represent Enterprise Value to LTM Revenue and LTM EBITDA at 12/31/2023

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Specialty Distribution Industry Update Q4 2023

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