EXCLUSIVE: Sonepar Discusses Past Performance and Future With tED Magazine

Following Sonepar’s record 2022 earnings results, the President of Sonepar North America, Rob Taylor, agreed to answer 5 questions about the past results and future plans from tED magazine’s Publisher Scott Costa.

tED: Digging a little deeper into Sonepar’s year-end results, how can you explain how your investments are driving performance and results?

Taylor: North America sales were $14B (USD) in 2022, +28% compared to 2021. I am very proud of the outstanding performance achieved by Sonepar associates throughout North America.

Like all distributors in our market, business was helped by the inflationary environment, and by a progressive easing of supply-chain constraints. However, our greater growth results from increased sales volume, which we attribute to our associates, and our customer-centric approach enhanced through our digital services and supply-chain investments. I am particularly proud of the significant benefits we are seeing because of our digital and supply-chain transformation journey which started over 4 years ago. In addition, we have focused heavily on acquisitions, welcoming nine new companies to Sonepar North America family since Q3 2021. I am confident that we will lead the market in investing in our business and the growth of our business for the future.         

tED: There’s always talk about troubled times ahead while we are also looking at a strong backlog of opportunities. How are you able to weigh the competing factors and create a strategy that fits an uncertain future?

Taylor: Sonepar has the financial stability to navigate through any potential market instability while continuing to invest in the long-term health and growth of our company. Globally, we are investing $1 billion to further digitalize our business and $2 billion in building the best automated supply-chain network in the electrical distribution market.

Since 2019, we have a growing number of state-of-the-art distribution centers offering our customers the greatest assortment of products with the best and most reliable delivery capabilities – we deliver to our customers when, where, and how they want. Our goal is to always make the workday easier for our customers, and our investments in digital tools coupled with automation throughout our supply chain network will provide our customers with the best omnichannel experience. A great example of our digital progress is the Digital Job Center which provides customers with the ability to entirely manage purchases and projects through their phone or computer anywhere and anytime.

tED: There’s been talk about the expectations from manufacturers and what distributors will need to do to maintain healthy relationships in the future. The basics of “where’s my stuff” is just the beginning. What kinds of conversations (generically speaking) are you having with suppliers to make sure your combined effort meets changing customer needs while still dealing with supply chain issues?

Taylor: This past fall, we had a very successful North America Vendor Summit attended by our strategic vendors. Among the many topics discussed, we communicated the sizeable investments we are making in automated CDCs and supply-chain, marketing capabilities, M&A and talent development and retention. This forum also provided an opportunity for our suppliers to communicate directly with us. Three themes developed from these conversations: 1) digital integration creating greater transparency throughout the entire supply chain from plant to customer, 2) continued expansion of data analytics to drive productivity and market share growth, and 3) supply chain collaboration to drive more digitally efficient and productive transactions. We share similar goals and feel our investments reflect this intention. Ultimately, we want to continue to grow with our strategic vendor partners and are committed to growing and transforming our operations for the future.

tED: You recently released an extended video on Cooper’s Automated Warehouse in New Jersey. What’s the ongoing commitment to the investment in automation and where do you see Sonepar’s operating companies in terms of automation for the rest of this decade?

Taylor: We believe that a successful distribution business requires a comprehensive automated CDC strategy; we have developed and are acting on our strategy of rapidly growing our automated distribution center network. A great example is North Coast Electric which ended 2022 by fully completing the automation of its Auburn, Washington CDC. North Coast is on track to reach its goal of $1 billion in sales by 2026 while remaining the most customer center electrical distributor in the Northwest territory. CDC investment will be continuous, with three new CDCs opening across the Sonepar US network this year and many more opening in the following years.

tED: Labor availability issues across the industry persist, yet Sonepar continues to maintain its strong workforce (including many tED magazine “30 Under 35” award winners). Why do you think your commitment to associates is different at Sonepar?

Taylor: The investments we are making in Sonepar also create great opportunities for our talented associates. I have always maintained that our associates remain the most important factor in our success, and associate well-being and future career growth opportunities are always a top priority. We have programs and internal experts that are dedicated to developing associates, helping set career goals and providing paths to achieve upward career growth and promotion. We must also listen to our associates and have implemented frequent associate survey programs to help us better understand and act on those changes and items that are identified. In our most recent survey, 86% of our associates told us “Sonepar is a great place to work.” Our goal is for each associate to feel happy, fulfilled, and safe working at Sonepar.

Further, we are very focused on diversity, equity, and inclusion initiatives. We are working to ensure the recruitment, and promotion, of underrepresented populations and strive to create a respectful and positive environment where all associates can do their best work. Our many employee resources groups are growing and becoming actively engaged in all aspects of the business, which is a very encouraging sign we are on the right track. Most importantly, we are listening to these resource groups and taking action.

 And finally, we are also receiving very positive feedback from our associates with respect to our sustainability and corporate responsibility initiatives. We remain aligned with the Sonepar Group in reducing our carbon footprint, and the efficiencies we are seeing in automation and supply-chain investments will allow us to accelerate these efforts.