PPB June 2021

Sales AndProfits In2020 Overall, most distributors, regardless of size (71 percent), reported sales down by 20 percent compared to 2019, while only 20 percent reported increased sales in 2020 vs. 60 percent in 2019. Compared to 2019, significantly fewer large distributors reported increased sales in 2020 (32 vs. 76 percent in 2019). The number of smaller distributors with increased sales also declined drastically (18 vs. 58 percent in 2019) (see Figure 3 ). In addition, 59 percent of all distributors reported a drop in profits with 60 percent of small distributors and 52 percent of large distributors experiencing a profit reduction in 2020 (see Figure 4 ). Orders Placed WithNon-Industry Suppliers The number of distributors doing business with non- industry suppliers in 2020 remained relatively unchanged across distributor segments (see Figure 5 ). However, sales from products sourced through non-industry providers decreased by 18 percent over 2019. A significant decrease was observed among large distributors (25 percent) (see Figure 6 ). Collectively, distributors of all sizes sold $2.95 billion in products from non-industry providers in 2020—or 15.4 percent of the total dollar volume. Online Sales Online sales of promotional products in 2020 are estimated to be $3.39 billion or 17.3 percent of total industry sales (see Figure 7 ). Online sales decreased 24.5 percent over 2019, a decline that was steeper among large distributors (32.6 percent) than among small distributors (3.2 percent) (see Figure 8 ). For the purposes of this study, online sales are defined as buys resulting from orders placed through an online store or website and are not to be confused with salespeople transmitting orders online. FEATURE | PPAI Exclusive Research: 2020 Distributor Sales Volume Estimate Figure 1: Two Decades Of Promotional Product Sales 2014 2016 2018 2000 2002 2004 2006 2008 2010 2012 2020 $17.9B $16.6B $15.6B $16.3B $17.3B $18B $18.8B $19.4B $18.1B $15.6B $16.6B $17.7B $18.5B $19.8B $20B $20.8B $21.3B $23.3B $24.8B $24.2B $19.6B Figure 2: A Snapshot Of 2020 Distributor Sales In Promotional Products SHOWN IN BILLIONS OF DOLLARS TOTAL SALES VOLUME $19.6B $10.1B SMALL DISTRIBUTORS (<$2.5M) LARGE DISTRIBUTORS (>$2.5M) $10.1B -19.0% -25.6% -10.6% Figure 3: Distributors Experiencing Sales Change In 2020 ALL DISTRIBUTORS SMALL DISTRIBUTORS (<$2.5M) LARGE DISTRIBUTORS (>$2.5M) SALES INCREASED SALES DECREASED 20% 18% 32% 71% 72% 64% Figure 4: Distributors Experiencing Profit Change In 2020 ALL DISTRIBUTORS SMALL DISTRIBUTORS (<$2.5M) LARGE DISTRIBUTORS (>$2.5M) SALES INCREASED SALES DECREASED 23% 22% 29% 59% 60% 52% 40 | JUNE 2021 |