Blog · Wallet share and penetration · Industrial distributors
How an industrial, MRO or building products distributor measures category penetration per account and finds dormant accounts per branch from the ERP's invoiced sales: the norm from your own accounts, the valued gap, the dormancy window, and the roll-up that reconciles to invoiced sales.
An industrial distributor's branches know their top twenty accounts by heart. Below those twenty sit hundreds of accounts that buy one category from the branch and four from a competitor, and dozens more that stopped buying last quarter and nobody noticed. All of it is in invoiced sales. This guide shows how to get the two lists out, per branch, and reconcile them to the number the company reports.
Category penetration, per account:
Penetration = categories the account bought in the period ÷ categories in the norm for its band
Dormancy, per account:
Dormant = no invoice in the last N days, where N is the global window or the account's own rhythm
Both are properties of an account. Both roll up to the branch by counting accounts and summing value, never by averaging percentages.
Account identifiers only.
An account below the norm has a gap in the categories it does not buy. Value each at the band's average annual spend in that category, or at the margin the category manager provides, and say which.
invoiced sales = Σ branches = Σ reps = Σ accounts = Σ categories
The by-category equality catches a category re-coded in the ERP mid-year; the by-branch one catches an account transferred between branches and counted in both.
One account, mid-size contractor band, norm of five categories.
| Category | Bought | Trailing 12m | Band norm | Gap value |
|---|---|---|---|---|
| Fasteners | Yes | $84k | Yes | |
| Safety | Yes | $31k | Yes | |
| Cutting tools | Yes | $12k | Yes | |
| Abrasives | No | Yes | $9k | |
| Power tools | No | Yes | $22k |
Three of five categories, $31k of valued gap, the larger half in power tools. On a branch with 600 accounts, the gap list sorted by value is the outside rep's quarter. The dormancy list beside it, twenty accounts that used to average $2k a month and have not ordered in ninety days, is the inside team's week.
Categories at the wrong level. A hierarchy with 400 leaf categories makes every account look under-penetrated. Use the level the branch sells and the norm is meaningful.
Cash sales without an account. Counter sales booked to a generic cash account inflate one account and hide the real buyers. Exclude the generic account from penetration and show its value as its own line.
Branch transfers. An account served by two branches after a territory change appears in both. The branch assertion fails, and the fix is a dated transfer.
Dormant because of a project, not a loss. A contractor between projects is dormant by the window and will be back. Let the rep mark the reason and keep the account on a watch list rather than the reactivation list.
Mapped once, the ERP export produces the gap list and the dormancy list per branch every week, reconciled to invoiced sales. Covirage builds this from the export as it is. The industrial distributors page describes the setup, and you can upload a sample ERP export and see the roll-up on your own rows.
Long enough that a regular buyer would have bought again. Ninety days is common for MRO accounts that order monthly; longer for project-driven accounts. The account's own history is the best guide: an account that ordered every three weeks for two years and has not ordered in ten weeks is dormant whatever the global window says.
From your own account base. Band accounts by type and size, and take the categories that more than half the band buys. An account below its band's norm has a gap; one above it is a reference account. No industry table needed.
No. Invoiced sales alone give penetration and dormancy. The CRM adds whether anyone has called the dormant account, which turns the list into a work plan.