Q4 Pulse of Lighting Report & 2019 Outlook

LDS 1 CS Q4Pulse 400

January 5, 2019

Just before the holidays, Channel Marketing Group launched its Q4 Pulse of Lighting survey to gain industry insights about market performance during Q4. Over 200 distributors, manufacturers and sales agents responded. 

As most know, the market was “eventful” in Q4. The quarter started with talk of U.S. tariffs impacting the industry, which came to fruition in October and culminated in many but not all manufacturers instituting some type of price increase in late October. The impact of the tariffs appears to have increased average selling prices for many, pulled some business forward to early in the quarter, and perhaps motivated some distributors to purchase “pre-tariff” and increase their inventories.

However, as Channel Marketing Group learned from interviews, the market appears to have slowed throughout the remainder of the quarter. Whether it is uncertainty about the originally proposed end-of-year tariff increase (now pushed to March) or a market slowdown or that the business was pulled forward, no one seems to know.

Additionally, respondents shared feedback from conglomerate efforts to support their “contractor grade” brands. One area commented on is that a number of these companies have reduced lighting agent commissions on these lines. Since the factory needs to be “more competitive,” they feel everyone needs to “share” (as they also have margin objectives). The challenge is that these lines require lighting agents to be more focused/engaged with electrical distributors and take them somewhat out of their normal sales cadre. Earning less provides less motivation. The commission reduction issue seems somewhat backwards, especially as supply reps report no change in commission from their lines and, in fact, some are benefiting from overage when their lines are “too” low on a quote (and the rep is protecting price integrity in the marketplace). More work to sell a lower dollar item at a lower commission rate because the company has a premium name? Perhaps this is why we’ve heard of agents having multiple line cards and / or expanding the number of lines that they represent?

Some insights from the survey conducted with William Blair

  • Sales increase ranged from 7.25-8.4%, depending upon the surveyed audience.
  • ASP (average sales price) increased 4.87%, however, also heard of declines in some areas based upon competitive challenges and product mix. Some “tier 2 and 3” lighting suppliers, who frequently are conglomerates strongest competitors for “white goods” business delayed, or didn’t implement in Q4, price increases that were tariff induced.
  • Growth continued strong in small and medium projects, the target audience for conglomerate’s new “contractor grade” offerings. If these companies can gain traction, these companies’ sales could grow at a faster rate.
  • Inventories grew a little for many and backlogs flattened for an increased number of distributors.
  • 2018 lighting growth overall exceeded industry growth projections of 5.8% by DISC.
  • 2019 outlook is mid to high single digit increase.
  • Many commented on quality issues … overall marketplace improvement, and when there are issues, they cut across all types of manufacturers.
  • Continued controls confusion in the marketplace is hindering widespread adoption, although there does appear to be more interest in controls.

Some other lighting tidbits:

  • 60-80% of some lighting agents’ business is focused on new projects/larger opportunities. With the research showing distributors are seeing strength in small to mid-sized projects (new and renovation), perhaps this is an indicator of why conglomerates have had less than market growth within the industry?
  • Legrand acquired Kenall Manufacturing. It appears that Kenall had 2017 revenues of US$100 million. Given this, it appears that through its acquisitions of Finelite, Pinnacle Lighting, OCL (Original Cast Lighting) and now Kenall that Legrand’s US lighting business is US$200-250M combined, with a focus on architectural / spec grade commercial lighting. It would be fair to speculate that this is also a strategy to expand Legrand’s commercial lighting control business as well as benefit wiring devices and, perhaps longer-term, elements of Wiremold, Ortronics and OnQ.
  • Maxlite has hired a new President/COO. Spencer Bolgard, formerly of Phoenix Contact, Cooper Industries, Seagull Lighting and AD, has joined Maxlite. Rick Schuett, formerly of Cimcon Lighting, Echelon and others, including spending 14 years with Lutron, is now VP Business Development.

Request a copy of the Q4 Pulse of Lighting Report for US$19: www.paypal.com/cgi-bin/webscr?cmd=_s-xclick&hosted_button_id=7QK9TWPWW9DX6

Related Articles


Changing Scene

  • Luminis Wins Red Dot Award for Pelican Line

    Luminis Wins 2025 Red Dot Award for Pelican Line

    Luminis, an established innovator and manufacturer of specification-grade, interior and exterior lighting solutions, has announced its Pelican family has received a Red Dot Design Award for Product Design. Dating back to 1955, the Red Dot Design Award is one of the world’s largest design competitions. Every year, the Red Dot Award: Product Design sets out… Read More…

  • May 19, 2025 - Contact Delage Announces New Representation Agreement with K-Array

    Contact Delage Announces New Representation Agreement with K-Array

    Contact Delage is pleased to announce their partnership with K-Array for the representation of their ultra-compact and powerful audio and integrated lighting solutions in the Quebec Province. Founded in Florence in 1990, K-Array is a true pioneer in high-performance compact sound. Their vision? To deliver uncompromising professional sound quality with a discreet and refined aesthetic.… Read More…


Design

  • T5 vs. T8 Lights – What’s the Difference?

    T5 vs. T8 Lights – What’s the Difference?

    T5 and T8 lights are two popular options when it comes to creating the right ambiance and lighting in a house, business, or commercial setting. But were you confused about these two light tubes when talking with suppliers? Don’t worry! In this article let’s discuss T5 vs. T8 tubes thoughtfully, so that you can make the right… Read More…

  • Garage Lighting Ideas: Illuminate Your Space

    Garage Lighting Ideas: Illuminate Your Space

    The significance of a well-lit garage cannot be overstated. It’s where you see clearly what’s in your toolbox, where you can comfortably assess your handy work and can always find what you’re looking for. The right lighting can inspire you to take on projects you might have postponed due to poor visibility. Proper lighting is… Read More…


New Products

  • LEDVANCE: LEDlescent LED T8 Slimline UL TYPE B Lamps

    LEDVANCE: LEDlescent LED T8 Slimline UL TYPE B Lamps

    LEDlescent UL Type B Ballast-Free Slimline T8 lamps are now being offered in 4-ft and 6-ft options to replace traditional T8 or T12 lamps. Offered in 3500K (PTO) or 4100K CCT with shatter-proof PET coating to cover the majority of applications.  These lamps have the patented internal safety circuit to prevent flow of electricity through… Read More…

  • SATCO|NUVO’s Hi-Lumen Hi-Pro Field Selectable Lamps

    SATCO|NUVO’s Hi-Lumen Hi-Pro Field Selectable Lamps

    SATCO|NUVO’s Hi-Lumen Hi-Pro lamps deliver high performance LED illumination, replacing metal halide lamps from 450W up to 1000W. With a staggering maximum output of over 73,000 lumens, they provide excellent brightness while improving energy efficiency and reducing maintenance costs. Built as field selectable, users can adjust both wattage and CCT to meet their specific needs… Read More…