Wholesale Turnover Statistics in Canada

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Wholesale Turnover Statistics in Canada
23rd Voorburg Group Meeting
Mary Beth Garneau
Aguascalientes, Mexico September 22nd to 26th,
2008
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Wholesalers and their services
In-store or co-op promotions
Banner wholesalers Drop shippers Rack
jobbers Wholesale merchants and
distributors Dealers of machinery equipment
Import-export merchants and agents Manufacturing
reps and agents Wholesale commission
agents Dealer-owned cooperatives Wholesale
brokers Buying groups
Distribution
Shipping
Buy and sell
Logistics
Packaging and labeling
Inventory management
Product training
Marketing and support services
Handling of warranty claims
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Definition of the service (1)

• North American Industry Classification (NAICS)
  2002
• Classification 41 ? Wholesale Trade 
• Establishments primarily engaged in wholesaling
  merchandise and providing related logistics,
  marketing and support services.
• generally an intermediate step many wholesalers
  are organized to sell merchandise in large
  quantities to retailers, and business and
  institutional clients.
• some wholesalers sell merchandise in single units
  to final users (particularly those that supply
  non-consumer capital goods)
• Note Unlike ISIC, the 2-digit NAICS boundary
  includes wholesale motor vehicles, parts and
  accessories

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Definition of the service (2)

• Wholesale Merchants
• Buy and sell merchandise on their own account,
  take title to the goods they sell.
• Wholesale Agents and Brokers
• Buy and sell merchandise owned by others on a fee
  or commission basis, do not take title to the
  goods they buy or sell.

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Wholesale statistics in Canada

• Distributive Trades Division
• Responsible for surveys of revenue and expenses
  (turnover)
• Prices Division
• Responsible for developing/producing SPPI
• System of National Accounts
• Responsible for estimates of real and nominal GDP

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Survey program overview
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Wholesale population and sample
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Monthly Wholesale Trade Survey

• A key indicator of the economic conditions of
  wholesale industries in Canada
• 5 of GDP on a value added basis
• Provides values and growth rates for sales and
  inventories by industry group and
  province/territory
• An analytical overview disseminated each month
  describing current trends within the context of
  Canadian economic environment

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Annual Wholesale Trade Survey

• A comprehensive program measuring the structural
  composition of wholesale industries in Canada
• Designed to meet the needs of the SNA
• Collects detailed revenue and expense data such
  as operating income, cost of goods sold,
  inventories and expenses
• Characteristics data such as Class of customers,
  outsourcing and types of merchants or agents and
  brokers

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Wholesale Origin Destination of Goods

• Data required for the National and Provincial
  Input-Output Table and constant dollar deflation
• Prior to RY 2008, collected on an occasional
  basis
• Most recent iteration was conducted for reference
  year 2001 with less than acceptable results
  stemming from poor response rates
• Pilot survey to collect data as a module within
  the Annual Wholesale Survey with fewer
  commodities
• New module will be launched to full sample for
  Reference Year 2008

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Market conditions (1)

• In Canada, wholesaling is a multi-billion-dollar
  industry, with sales totalling 660 billion in
  2006.
• Canadas wholesale industry accounts for about 5
  of Canadas GDP

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Market conditions (2)

• Import a large share of the goods they distribute
  (typically from the United States)
• Quick to adopt new information and communications
  technologies, have recorded above-average growth
  in capital investments
• Globalisation, offshore outsourcing, and the
  arrival of American-style retailing (big box
  stores and club warehouses)

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GDP estimates

• Value-added is the sum of the following
  Input-output wholesale table input commodities
• Wages and salaries
• Supplementary labour income
• Mixed income
• Other operating surplus
• Indirect taxes and subsidies

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Deflation

• Constant price estimates of monthly industry
  output
• monthly indicator
• Monthly GDP by industry
• Annual deflation of commodity output
• Inputs
• Commodity detail of industry
• Margins
• Combination of Industrial Product Price Indexes
  and Import Price Indexes

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Challenges ahead

• Deflation
• Updated accurate commodity data
• Wholesale price indexes
• Globalization-induced changes to the structure of
  multinational firms with operations in Canada
• Accurately and consistently define, delineate and
  measure the wholesale industry.
• Wholesale activities can take place in a variety
  of areas of the economy (manufacturing sales
  branches, head-office, logistics, warehousing,,
  etc.)
• Consistent industrial classification of
  production units can be a challenge. For example,
  the same activities of different firms may be
  classified in different industries based on each
  firms most-recently profiled book-keeping
  practices.
• Avoid volatility in the wholesale statistical
  series resulting from changes in classification
  that may not reflect actual changes in economic
  activity.

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Discussion