The State Of Innovation 2026 | Must Read • SEPTEMBER 2026 • 93 TABLE 9: What was your IT staff turnover rate in the last year? Distributors $100M+ 5% Distributors $25M-$100M 2% Distributors $10M-$25M 25% Distributors $3M-$10M 3% Distributors Under $3M 9% Both suppliers and distributors report the same 7% turnover rate for IT staff over the past year. Interestingly, companies in the $10M-$25M range report the largest amount of turnover. “I’m encouraged that nearly 90% of distributors are investing in AI, but the winners won’t be the companies using AI simply to generate content,” Rector says. “They’ll be the organizations that use it to automate operations, eliminate friction, accelerate decision-making and fundamentally improve the client experience. “One of the biggest advantages we’re seeing is the speed at which AI allows us to develop, test and implement new ideas. Capabilities that once took months or years can now be deployed in a weekend.” Enrique Perez, president and founder of Hitex Marketing Group, PPAI 100’s No. 62 distributor, is fascinated that many distributors consider innovation to be a challenge. “We see it as our biggest opportunity,” Perez says. “Implementation of AI at every department in our company is exciting. Teams must embrace this change if they want to remain relevant in our industry.” TABLE 10: How does your firm ensure compliance with relevant IT governance and data protection regulations? Artificial Intelligence (AI) Blockchain Internet of Things (IoT) Augmented Reality (AR) Virtual Reality (VR) 3D Printing Other None Distributors $100M+ 88% 6% 31% 19% 13% 25% 13% 6% Distributors $25M-$100M 97% 6% 21% 18% 18% 26% 24% 0% Distributors $10M-$25M 100% 12% 12% 12% 16% 24% 12% 0% Distributors $3M-$10M 100% 4% 16% 4% 4% 20% 4% 0% Distributors Under $3M 63% 0% 3% 3% 0% 7% 3% 33% TABLE 11: What are the top challenges in implementing a digital transformation strategy in your firm? Budget Constraints Lack Of Expertise Resistance To Change Other Distributors $100M+ 54% 0% 23% 23% Distributors $25M-$100M 30% 12% 27% 30% Distributors $10M-$25M 12% 32% 20% 36% Distributors $3M-$10M 24% 32% 16% 28% Distributors Under $3M 38% 45% 10% 7%
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