Graybar Electric Company
Encyclopedia
Graybar is a wholesale distribution business, included on the Fortune 500
list of the largest United States
corporations. Founded in Cleveland
, Ohio
in 1869, the company is currently based in St. Louis, Missouri
. Graybar is a leading distributor of electrical, communications and data networking products and provider of related supply chain management and logistics services.
Reconstruction era, an Entrepreneur
named Enos Barton (who had served as a telegrapher
during the war) worked for Western Union
in Rochester
, New York
. During this period, Barton met George Shawk, the foreman of the company's Cleveland, Ohio shop. When that shop was closed down, Shawk bought some of the equipment and went into business for himself, making various kinds of electrical and other apparatus, including inventor's models. While on a trip to Rochester, he and Barton, who was then 26, agreed to go into partnership
.
To raise the $400 her son needed for his share of the business venture, Barton's widowed mother mortgaged her home.
The new firm, located at 93 St. Clair St. in Cleveland, grew. In May 1869, Elisha Gray
, an Oberlin College
professor and inventor of telegraphic equipment, bought out Shawk's interest.
Up until then, Gray had been one of the firm's top customers. He had invented a needle annunciator for hotels and elevators, a telautograph
(a machine for the electrical transmission of writing, which was the predecessor to the fax machine
), and the telegraph answer-back call box. Gray and Barton joined forces with an investment of $2,500 each, with Gray as the senior partner. The success of the new company attracted the attention of General Anson Stager
, general superintendent of the Western Union Telegraph Company. He offered to enter the business as an equal partner with Gray and Barton, providing the company's headquarters was moved from Cleveland to Chicago
, Illinois
. In December 1869, the company moved to 162 S. Water St., Chicago. The great Chicago Fire in 1871 nearly destroyed the company, coming within two blocks of its small plant.
The destruction caused by the fire then resulted in even greater growth for Gray & Barton, as the company sold fire alarms, which were now in high demand, and also helped to rebuild the Western Union infrastructure in the city.
in 1872 to meet the capital requirements of the telegraph supply business. The new company so closely allied with the elder Western that three of its five directors were Western Union executives. Moreover, Stager was named president, although it was Barton as secretary/treasurer who actually handled day-to-day affairs.
Although the young firm thrived in the telegraph industry, it was not until the invention of the telephone
by Alexander Graham Bell
in 1876, and the incandescent lamp
by Thomas Alva Edison in 1879, that Western Electric began to gain stature as a large company.
Part-owner Gray held the title of company electrician and spent his days working on his inventions, becoming increasingly less involved in the operations of the shop, and eventually he sold his interest in Western Electric in 1875 and retired to pursue independent research and to teach at Oberlin College. In 1876 he filed a caveat with the U.S. Patent Office, announcing his intention to soon patent an invention that would transmit vocal sounds telegraphically. Gray dubbed his telephone "the harmonic telegraph." Only hours earlier, however, Alexander Graham Bell applied for a patent for the same idea, which became known as the telephone. As it turned out, what Bell actually patented would have never worked, while Gray's idea would have. Western Union acquired both Gray's and Edison's telephone patents to challenge the American Bell Telephony Company (renamed AT&T in 1899), which led to a patent infringement suit and Bell ultimately being named the inventor of the telephone. Therefore it was Bell's patent and not Gray’s that launched the telecommunications industry.
As applications of electricity
broadened, Western Electric not only sold the electric bell
s and batteries
, telegraph key
s, fire alarm box
es and hotel annunciators it originally manufactured, but also many items it purchased from other manufacturers.
Stager served as president of Western Electric until shortly before his death in 1885, and Barton then served as president from 1886 to 1908.
Western Electric Company was the first company to join in a Japanese joint venture with foreign capital. It invested in Nippon Electric Company, Ltd. in 1899. Western Electric held 54% of NEC at the time. Their representative in Japan was Walter Tenney Carleton
.
By the turn of the century, Western Electric had become the main producer of telephone equipment in the United States. It also manufactured arc lamp
s, lighting equipment and power apparatus, ranging from small fans to huge motors and generators. Right alongside this manufacturing business, the distribution business continued to grow, handling an extensive line of electrical supplies such as wire
, conduit
, wiring devices
and pole line
material.
By the 1910s the company became the world’s largest distributor and the United States’ leading wholesaler of electrical supplies. These facts attracted investment by the American Bell Telephone Company
, which also discovered that Gray and Barton could purchase supplies and sell them to the telephone companies more efficiently than the companies could acquire the supplies themselves.
A chain of warehouses was established across the nation, and the growth of the distributing business continued to increase through World War I
and into the post-war period.
Scores of electrical supply manufacturers were using the company's distribution network, and business relationships were formed. Some of these relationships, such as with General Electric
and the Square D Company
, are more than a century old and still exist today. In 1926 a separate entity was established for handling distribution of supplies and equipment. This new entity was named "Graybar" in honor of the company's founders, Elisha Gray and Enos Barton. This was the first time a major corporation had reverted to its original designation as the basis for its corporate name.
The Graybar Electric Company was capitalized at $9 million and consisted of 59 distributing houses in cities across the U.S. Graybar had become the largest merchandiser of electrical supplies in the world.
In 1929, Graybar employees purchased their company for its capitalized value, which consisted of $3 million in cash and $6 million in cumulative preferred stock.
During the 1930s, the company explored many different avenues of income, including a line of appliances and sewing machines under the Graybar brand name. By 1941 the company's sales volume was more than $100 million, the number of distribution houses had jumped to 86, and there was a corresponding increase in personnel. Also that year, the remaining outstanding shares of stock were purchased from Western Electric with a $1 million check signed by Graybar President Frank A. Ketcham.
When the country entered World War II
, Graybar's ingenuity and knowledge of logistics proved to be of immeasurable value in providing war-needed goods. Graybar became a vital link between America's manufacturers and America's defense needs. Defense-related business continued in the postwar years, with Graybar again aiding the military during the subsequent Korean War
and Vietnam War
. Overall the company enjoyed strong growth in the years following World War II, its momentum not checked until the recession of the mid-1970s, which led to Graybar slashing its workforce by 20 percent. As a result, when economic conditions improved in the 1980s Graybar was unable to gear up quickly enough to meet the rising demand for electrical products.
The corporate headquarters moved from the Graybar Building in New York City
to St. Louis, Missouri
in 1982.
Graybar modernized its infrastructure, implementing one of the first computer-to-computer ordering systems, but a weak real estate market and slowdown in construction began to take its toll on the bottom line. Revenues, which had approached $1.5 billion in 1980, improved to just $1.89 billion in 1990, then fell to $1.74 billion in 1991, prompting the closure of some regional offices and another reduction in the workforce. Aside from a weak economy, it was also becoming clear to management that Graybar suffered from internal problems; the company was losing market share on its traditional electrical business while unable to make desired progress on the newer communications/data products.
Business improved as the economy recovered in the early 1990s. Despite sales growing to $2.3 billion in 1994, management decided to realign the business starting in January 1995, forming two business groups, one for electrical supplies and another devoted to the increasingly important comm/data business. That same year, Graybar formed the Solutions Providers Alliance, teaming up with wholesale distributors Kaman Industrial Technologies, WWR Scientific Products, and Vallen Corporation. To accommodate an aggressive new growth strategy, Graybar added 45 locations, 2,400 employees, and 350 salespeople from 1994 to 1999. It also improved its network of warehouses, spending $144 million to construct 16 major new facilities that dramatically cut down on delivery time. As a result of these investments, the company was well positioned to take advantage of a strong economy in the final years of the 1990s. In 1999 annual revenues topped $4.2 billion, while profits almost doubled during this period, improving from $36 million in 1995 to $64 million in 1999. The improvement in the comm/data sector was of particular importance. In 1991 it accounted for just 17 percent of Graybar sales, but by 1999 totaled 38 percent.
Graybar engaged in some external growth, making several acquisitions in 1999 and 2000, the largest being Splane Electric Supply Co., a Detroit, Michigan, company with $30 million in annual sales, 70 employees, and six locations. In 2000 Graybar revenues improved to $5.2 billion, while net income topped $66.2 million. To support further expansion of its nationwide distribution centers, instrumental to the company's growth, Graybar placed a $100 million bond offering in the summer of 2001, the largest financing effort in its history. By this time nine of the 16 distribution centers started in 1997 were operational and the remaining seven were only months away from opening. Once the system was in place, Graybar was able to achieve its long-term aim of being able to ship to customers within 24 hours throughout the United States.
A downturn in the economy, however, soon hurt business and forced management to fine tune the company's strategy. In 2001 revenues fell to $4.8 billion and business continued to drop off in 2002 and 2003 to $3.99 billion and $3.78 billion, respectively. As it had done in the early 1990s, Graybar opted to invest in its infrastructure in order to be ready to take advantage of the economy when it ultimately rebounded. The company invested $90 million on new technology to provide customers with more detailed information on orders, deliveries, and payments. At the same time, it encouraged its 4,100 suppliers to implement a standardized bar code system to create an open, central database similar to that found in the retail industry. In this way, Graybar would distinguish itself from its rivals, graduating from the role of middleman to a supply chain expert capable of adding value to the process. Once the new system was functional, Graybar hoped to be able to sell detailed reports to both suppliers and customers in the then $73 billion electrical supply industry.
Graybar's revenues had increased to $4.1 billion in 2004, $4.3 billion in 2005, and a then-all-time high of $5 billion in 2006.
Today, Graybar operates a network of 250 distribution centers throughout the U.S., Canada, Mexico and Puerto Rico as well as authorized agents around the world. Graybar Electric Company, Inc. is engaged internationally in the distribution of electrical, telecommunications and networking products and integrated supply services primarily to contractors, industrial plants, telephone companies, power utilities and commercial users. All the products Graybar sells are purchased from others. Through its suppliers, Graybar provides products such as boxes & fittings, business telephone systems, cabinets and racks, cabling management and pathways, chemicals and adhesives, communications wire, cable and fiber conduit, raceway and fasteners, controls and motors, copper connectivity solutions, distribution equipment, enclosures and industrial products, fiber connectivity solutions, heating and ventilating, industrial automation and control lamps, lighting and ballasts, life safety and signaling, networking and wireless, power distribution, security and notification, products terminating, splicing and grounding, testing instruments, tools and installation products, voice and accessory products, wire and cable, wiring devices, and protection and power conditioning for a number of markets and industries including contractors, electrical contractors, communications contractors, government, industrial security, service providers, and retailer hospitality solutions.
Sales for 2007 were more than $5.25 billion, positioning Graybar at #455 on the Fortune 500 listing and #55 for privately held companies
. From January 1 to June 30, 2008, Graybar posted profit of $47.4 million on revenue of $2.7 billion for the six-month period, up from a profit of $39.7 million, on revenue of $2.6 billion for the same period in 2007. In 2008 Graybar was named the ”most admired” Fortune 500 company in the Wholesalers: Diversified category. In 2008, Graybar rose to the #439 spot on the Fortune 500 listing. Sales for 2009 were $4.4 billion, positioning Graybar at #439 on the Fortune 500 listing and #64 on Forbes List of America’s Largest Private Companies.
In 2010, Graybar had a healthy revenue growth and sales rose to $4.6 billion, a 5.4 percent increase from 2009. Net income of $42.3 million meant a 12.9 percent increase from the previous year and Graybar was listed as #70 for privately held companies.
In 2011, sales for the first six months of the year reached nearly $2.6 billion, an increase of 20 percent as compared to the same period in 2010. Net income for first half of the year grew to $35.4 million, a 172 percent increase for the same period in 2010. Graybar is currently listed as #480 on the Fortune 500 listing. Graybar is an independent distributor and is still one of the largest employee-owned companies in the United States.
Fortune 500
The Fortune 500 is an annual list compiled and published by Fortune magazine that ranks the top 500 U.S. closely held and public corporations as ranked by their gross revenue after adjustments made by Fortune to exclude the impact of excise taxes companies collect. The list includes publicly and...
list of the largest United States
United States
The United States of America is a federal constitutional republic comprising fifty states and a federal district...
corporations. Founded in Cleveland
Cleveland, Ohio
Cleveland is a city in the U.S. state of Ohio and is the county seat of Cuyahoga County, the most populous county in the state. The city is located in northeastern Ohio on the southern shore of Lake Erie, approximately west of the Pennsylvania border...
, Ohio
Ohio
Ohio is a Midwestern state in the United States. The 34th largest state by area in the U.S.,it is the 7th‑most populous with over 11.5 million residents, containing several major American cities and seven metropolitan areas with populations of 500,000 or more.The state's capital is Columbus...
in 1869, the company is currently based in St. Louis, Missouri
St. Louis, Missouri
St. Louis is an independent city on the eastern border of Missouri, United States. With a population of 319,294, it was the 58th-largest U.S. city at the 2010 U.S. Census. The Greater St...
. Graybar is a leading distributor of electrical, communications and data networking products and provider of related supply chain management and logistics services.
Early history
During the post-Civil WarAmerican Civil War
The American Civil War was a civil war fought in the United States of America. In response to the election of Abraham Lincoln as President of the United States, 11 southern slave states declared their secession from the United States and formed the Confederate States of America ; the other 25...
Reconstruction era, an Entrepreneur
Entrepreneur
An entrepreneur is an owner or manager of a business enterprise who makes money through risk and initiative.The term was originally a loanword from French and was first defined by the Irish-French economist Richard Cantillon. Entrepreneur in English is a term applied to a person who is willing to...
named Enos Barton (who had served as a telegrapher
Telegraphist
Telegraphist is an operator who uses the morse code in order to communicate by land or radio lines. Telegraphists were indispensable at sea in the early day of Wireless Telegraphy. During the Great War the Royal Navy enlisted many volunteers as Telegraphists. Telegraphists are also called Telegraph...
during the war) worked for Western Union
Western Union
The Western Union Company is a financial services and communications company based in the United States. Its North American headquarters is in Englewood, Colorado. Up until 2006, Western Union was the best-known U.S...
in Rochester
Rochester, New York
Rochester is a city in Monroe County, New York, south of Lake Ontario in the United States. Known as The World's Image Centre, it was also once known as The Flour City, and more recently as The Flower City...
, New York
New York
New York is a state in the Northeastern region of the United States. It is the nation's third most populous state. New York is bordered by New Jersey and Pennsylvania to the south, and by Connecticut, Massachusetts and Vermont to the east...
. During this period, Barton met George Shawk, the foreman of the company's Cleveland, Ohio shop. When that shop was closed down, Shawk bought some of the equipment and went into business for himself, making various kinds of electrical and other apparatus, including inventor's models. While on a trip to Rochester, he and Barton, who was then 26, agreed to go into partnership
Partnership
A partnership is an arrangement where parties agree to cooperate to advance their mutual interests.Since humans are social beings, partnerships between individuals, businesses, interest-based organizations, schools, governments, and varied combinations thereof, have always been and remain commonplace...
.
To raise the $400 her son needed for his share of the business venture, Barton's widowed mother mortgaged her home.
The new firm, located at 93 St. Clair St. in Cleveland, grew. In May 1869, Elisha Gray
Elisha Gray
Elisha Gray was an American electrical engineer who co-founded the Western Electric Manufacturing Company...
, an Oberlin College
Oberlin College
Oberlin College is a private liberal arts college in Oberlin, Ohio, noteworthy for having been the first American institution of higher learning to regularly admit female and black students. Connected to the college is the Oberlin Conservatory of Music, the oldest continuously operating...
professor and inventor of telegraphic equipment, bought out Shawk's interest.
Up until then, Gray had been one of the firm's top customers. He had invented a needle annunciator for hotels and elevators, a telautograph
Telautograph
The telautograph, an analog precursor to the modern fax machine, transmits electrical impulses recorded by potentiometers at the sending station to servomechanisms attached to a pen at the receiving station, thus reproducing at the receiving station a drawing or signature made by the sender...
(a machine for the electrical transmission of writing, which was the predecessor to the fax machine
Fax
Fax , sometimes called telecopying, is the telephonic transmission of scanned printed material , normally to a telephone number connected to a printer or other output device...
), and the telegraph answer-back call box. Gray and Barton joined forces with an investment of $2,500 each, with Gray as the senior partner. The success of the new company attracted the attention of General Anson Stager
Anson Stager
Anson Stager was the co-founder of Western Union, the first president of Western Electric Manufacturing Company and Union Army general, where he was head of the Military Telegraph Department during the Civil War.-Biography:...
, general superintendent of the Western Union Telegraph Company. He offered to enter the business as an equal partner with Gray and Barton, providing the company's headquarters was moved from Cleveland to Chicago
Chicago
Chicago is the largest city in the US state of Illinois. With nearly 2.7 million residents, it is the most populous city in the Midwestern United States and the third most populous in the US, after New York City and Los Angeles...
, Illinois
Illinois
Illinois is the fifth-most populous state of the United States of America, and is often noted for being a microcosm of the entire country. With Chicago in the northeast, small industrial cities and great agricultural productivity in central and northern Illinois, and natural resources like coal,...
. In December 1869, the company moved to 162 S. Water St., Chicago. The great Chicago Fire in 1871 nearly destroyed the company, coming within two blocks of its small plant.
Incorporation as Western Electric
After several relocations, all in Chicago, the business was incorporated as the Western Electric Manufacturing CompanyWestern Electric
Western Electric Company was an American electrical engineering company, the manufacturing arm of AT&T from 1881 to 1995. It was the scene of a number of technological innovations and also some seminal developments in industrial management...
in 1872 to meet the capital requirements of the telegraph supply business. The new company so closely allied with the elder Western that three of its five directors were Western Union executives. Moreover, Stager was named president, although it was Barton as secretary/treasurer who actually handled day-to-day affairs.
Although the young firm thrived in the telegraph industry, it was not until the invention of the telephone
Telephone
The telephone , colloquially referred to as a phone, is a telecommunications device that transmits and receives sounds, usually the human voice. Telephones are a point-to-point communication system whose most basic function is to allow two people separated by large distances to talk to each other...
by Alexander Graham Bell
Alexander Graham Bell
Alexander Graham Bell was an eminent scientist, inventor, engineer and innovator who is credited with inventing the first practical telephone....
in 1876, and the incandescent lamp
Incandescent light bulb
The incandescent light bulb, incandescent lamp or incandescent light globe makes light by heating a metal filament wire to a high temperature until it glows. The hot filament is protected from air by a glass bulb that is filled with inert gas or evacuated. In a halogen lamp, a chemical process...
by Thomas Alva Edison in 1879, that Western Electric began to gain stature as a large company.
Part-owner Gray held the title of company electrician and spent his days working on his inventions, becoming increasingly less involved in the operations of the shop, and eventually he sold his interest in Western Electric in 1875 and retired to pursue independent research and to teach at Oberlin College. In 1876 he filed a caveat with the U.S. Patent Office, announcing his intention to soon patent an invention that would transmit vocal sounds telegraphically. Gray dubbed his telephone "the harmonic telegraph." Only hours earlier, however, Alexander Graham Bell applied for a patent for the same idea, which became known as the telephone. As it turned out, what Bell actually patented would have never worked, while Gray's idea would have. Western Union acquired both Gray's and Edison's telephone patents to challenge the American Bell Telephony Company (renamed AT&T in 1899), which led to a patent infringement suit and Bell ultimately being named the inventor of the telephone. Therefore it was Bell's patent and not Gray’s that launched the telecommunications industry.
As applications of electricity
Electricity
Electricity is a general term encompassing a variety of phenomena resulting from the presence and flow of electric charge. These include many easily recognizable phenomena, such as lightning, static electricity, and the flow of electrical current in an electrical wire...
broadened, Western Electric not only sold the electric bell
Electric bell
An electric bell is a mechanical bell that functions by means of an electromagnet. When an electric current is applied, it produces a repetitive buzzing or clanging sound...
s and batteries
Battery (electricity)
An electrical battery is one or more electrochemical cells that convert stored chemical energy into electrical energy. Since the invention of the first battery in 1800 by Alessandro Volta and especially since the technically improved Daniell cell in 1836, batteries have become a common power...
, telegraph key
Telegraph key
Telegraph key is a general term for any switching device used primarily to send Morse code. Similar keys are used for all forms of manual telegraphy, such as in electrical telegraph and radio telegraphy.- Types of keys :...
s, fire alarm box
Fire alarm box
A fire alarm box is an outdoor device used for notifying a fire department of a fire. Early boxes used the telegraph system and were the main method of calling the fire department to a neighborhood in the days before people had telephones. When the box is triggered, a spring-loaded wheel spins and...
es and hotel annunciators it originally manufactured, but also many items it purchased from other manufacturers.
Stager served as president of Western Electric until shortly before his death in 1885, and Barton then served as president from 1886 to 1908.
Western Electric Company was the first company to join in a Japanese joint venture with foreign capital. It invested in Nippon Electric Company, Ltd. in 1899. Western Electric held 54% of NEC at the time. Their representative in Japan was Walter Tenney Carleton
Walter Tenney Carleton
Walter Tenney Carleton was an early international businessman. He was one of the three founding directors of NEC Corporation, the first Japanese joint venture with foreign capital.- Youth and education :...
.
By the turn of the century, Western Electric had become the main producer of telephone equipment in the United States. It also manufactured arc lamp
Arc lamp
"Arc lamp" or "arc light" is the general term for a class of lamps that produce light by an electric arc . The lamp consists of two electrodes, first made from carbon but typically made today of tungsten, which are separated by a gas...
s, lighting equipment and power apparatus, ranging from small fans to huge motors and generators. Right alongside this manufacturing business, the distribution business continued to grow, handling an extensive line of electrical supplies such as wire
Wire
A wire is a single, usually cylindrical, flexible strand or rod of metal. Wires are used to bear mechanical loads and to carry electricity and telecommunications signals. Wire is commonly formed by drawing the metal through a hole in a die or draw plate. Standard sizes are determined by various...
, conduit
Electrical conduit
An electrical conduit is an electrical piping system used for protection and routing of electrical wiring. Electrical conduit may be made of metal, plastic, fiber, or fired clay. Flexible conduit is available for special purposes....
, wiring devices
Electrical wiring (United States)
Electrical wiring in North America follows regulations and standards for installation of building wiring. Electrical wiring in the United States is generally in compliance with the National Electrical Code, a standard sponsored by the National Fire Protection Association which has been periodically...
and pole line
Telephone line
A telephone line or telephone circuit is a single-user circuit on a telephone communication system...
material.
By the 1910s the company became the world’s largest distributor and the United States’ leading wholesaler of electrical supplies. These facts attracted investment by the American Bell Telephone Company
Bell Telephone Company
The Bell Telephone Company, a common law joint stock company, was organized in Boston, Massachusetts on July 9, 1877 by Alexander Graham Bell's father-in-law Gardiner Greene Hubbard, who also helped organize a sister company — the New England Telephone and Telegraph Company...
, which also discovered that Gray and Barton could purchase supplies and sell them to the telephone companies more efficiently than the companies could acquire the supplies themselves.
A chain of warehouses was established across the nation, and the growth of the distributing business continued to increase through World War I
World War I
World War I , which was predominantly called the World War or the Great War from its occurrence until 1939, and the First World War or World War I thereafter, was a major war centred in Europe that began on 28 July 1914 and lasted until 11 November 1918...
and into the post-war period.
The Formation of Graybar
General Electric
General Electric Company , or GE, is an American multinational conglomerate corporation incorporated in Schenectady, New York and headquartered in Fairfield, Connecticut, United States...
and the Square D Company
Square D
Square D is an American manufacturer of equipment used to control and distribute electric power headquartered in Palatine, Illinois.Square D was founded in 1903 in Detroit, Michigan by Bryson Dexter Horton who is credited with the invention of the safety switch which encased high voltage switches...
, are more than a century old and still exist today. In 1926 a separate entity was established for handling distribution of supplies and equipment. This new entity was named "Graybar" in honor of the company's founders, Elisha Gray and Enos Barton. This was the first time a major corporation had reverted to its original designation as the basis for its corporate name.
The Graybar Electric Company was capitalized at $9 million and consisted of 59 distributing houses in cities across the U.S. Graybar had become the largest merchandiser of electrical supplies in the world.
In 1929, Graybar employees purchased their company for its capitalized value, which consisted of $3 million in cash and $6 million in cumulative preferred stock.
When the country entered World War II
World War II
World War II, or the Second World War , was a global conflict lasting from 1939 to 1945, involving most of the world's nations—including all of the great powers—eventually forming two opposing military alliances: the Allies and the Axis...
, Graybar's ingenuity and knowledge of logistics proved to be of immeasurable value in providing war-needed goods. Graybar became a vital link between America's manufacturers and America's defense needs. Defense-related business continued in the postwar years, with Graybar again aiding the military during the subsequent Korean War
Korean War
The Korean War was a conventional war between South Korea, supported by the United Nations, and North Korea, supported by the People's Republic of China , with military material aid from the Soviet Union...
and Vietnam War
Vietnam War
The Vietnam War was a Cold War-era military conflict that occurred in Vietnam, Laos, and Cambodia from 1 November 1955 to the fall of Saigon on 30 April 1975. This war followed the First Indochina War and was fought between North Vietnam, supported by its communist allies, and the government of...
. Overall the company enjoyed strong growth in the years following World War II, its momentum not checked until the recession of the mid-1970s, which led to Graybar slashing its workforce by 20 percent. As a result, when economic conditions improved in the 1980s Graybar was unable to gear up quickly enough to meet the rising demand for electrical products.
The corporate headquarters moved from the Graybar Building in New York City
New York City
New York is the most populous city in the United States and the center of the New York Metropolitan Area, one of the most populous metropolitan areas in the world. New York exerts a significant impact upon global commerce, finance, media, art, fashion, research, technology, education, and...
to St. Louis, Missouri
Missouri
Missouri is a US state located in the Midwestern United States, bordered by Iowa, Illinois, Kentucky, Tennessee, Arkansas, Oklahoma, Kansas and Nebraska. With a 2010 population of 5,988,927, Missouri is the 18th most populous state in the nation and the fifth most populous in the Midwest. It...
in 1982.
Recent years
Business improved as the economy recovered in the early 1990s. Despite sales growing to $2.3 billion in 1994, management decided to realign the business starting in January 1995, forming two business groups, one for electrical supplies and another devoted to the increasingly important comm/data business. That same year, Graybar formed the Solutions Providers Alliance, teaming up with wholesale distributors Kaman Industrial Technologies, WWR Scientific Products, and Vallen Corporation. To accommodate an aggressive new growth strategy, Graybar added 45 locations, 2,400 employees, and 350 salespeople from 1994 to 1999. It also improved its network of warehouses, spending $144 million to construct 16 major new facilities that dramatically cut down on delivery time. As a result of these investments, the company was well positioned to take advantage of a strong economy in the final years of the 1990s. In 1999 annual revenues topped $4.2 billion, while profits almost doubled during this period, improving from $36 million in 1995 to $64 million in 1999. The improvement in the comm/data sector was of particular importance. In 1991 it accounted for just 17 percent of Graybar sales, but by 1999 totaled 38 percent.
Graybar engaged in some external growth, making several acquisitions in 1999 and 2000, the largest being Splane Electric Supply Co., a Detroit, Michigan, company with $30 million in annual sales, 70 employees, and six locations. In 2000 Graybar revenues improved to $5.2 billion, while net income topped $66.2 million. To support further expansion of its nationwide distribution centers, instrumental to the company's growth, Graybar placed a $100 million bond offering in the summer of 2001, the largest financing effort in its history. By this time nine of the 16 distribution centers started in 1997 were operational and the remaining seven were only months away from opening. Once the system was in place, Graybar was able to achieve its long-term aim of being able to ship to customers within 24 hours throughout the United States.
A downturn in the economy, however, soon hurt business and forced management to fine tune the company's strategy. In 2001 revenues fell to $4.8 billion and business continued to drop off in 2002 and 2003 to $3.99 billion and $3.78 billion, respectively. As it had done in the early 1990s, Graybar opted to invest in its infrastructure in order to be ready to take advantage of the economy when it ultimately rebounded. The company invested $90 million on new technology to provide customers with more detailed information on orders, deliveries, and payments. At the same time, it encouraged its 4,100 suppliers to implement a standardized bar code system to create an open, central database similar to that found in the retail industry. In this way, Graybar would distinguish itself from its rivals, graduating from the role of middleman to a supply chain expert capable of adding value to the process. Once the new system was functional, Graybar hoped to be able to sell detailed reports to both suppliers and customers in the then $73 billion electrical supply industry.
Graybar's revenues had increased to $4.1 billion in 2004, $4.3 billion in 2005, and a then-all-time high of $5 billion in 2006.
Today, Graybar operates a network of 250 distribution centers throughout the U.S., Canada, Mexico and Puerto Rico as well as authorized agents around the world. Graybar Electric Company, Inc. is engaged internationally in the distribution of electrical, telecommunications and networking products and integrated supply services primarily to contractors, industrial plants, telephone companies, power utilities and commercial users. All the products Graybar sells are purchased from others. Through its suppliers, Graybar provides products such as boxes & fittings, business telephone systems, cabinets and racks, cabling management and pathways, chemicals and adhesives, communications wire, cable and fiber conduit, raceway and fasteners, controls and motors, copper connectivity solutions, distribution equipment, enclosures and industrial products, fiber connectivity solutions, heating and ventilating, industrial automation and control lamps, lighting and ballasts, life safety and signaling, networking and wireless, power distribution, security and notification, products terminating, splicing and grounding, testing instruments, tools and installation products, voice and accessory products, wire and cable, wiring devices, and protection and power conditioning for a number of markets and industries including contractors, electrical contractors, communications contractors, government, industrial security, service providers, and retailer hospitality solutions.
Sales for 2007 were more than $5.25 billion, positioning Graybar at #455 on the Fortune 500 listing and #55 for privately held companies
Privately held company
A privately held company or close corporation is a business company owned either by non-governmental organizations or by a relatively small number of shareholders or company members which does not offer or trade its company stock to the general public on the stock market exchanges, but rather the...
. From January 1 to June 30, 2008, Graybar posted profit of $47.4 million on revenue of $2.7 billion for the six-month period, up from a profit of $39.7 million, on revenue of $2.6 billion for the same period in 2007. In 2008 Graybar was named the ”most admired” Fortune 500 company in the Wholesalers: Diversified category. In 2008, Graybar rose to the #439 spot on the Fortune 500 listing. Sales for 2009 were $4.4 billion, positioning Graybar at #439 on the Fortune 500 listing and #64 on Forbes List of America’s Largest Private Companies.
In 2010, Graybar had a healthy revenue growth and sales rose to $4.6 billion, a 5.4 percent increase from 2009. Net income of $42.3 million meant a 12.9 percent increase from the previous year and Graybar was listed as #70 for privately held companies.
In 2011, sales for the first six months of the year reached nearly $2.6 billion, an increase of 20 percent as compared to the same period in 2010. Net income for first half of the year grew to $35.4 million, a 172 percent increase for the same period in 2010. Graybar is currently listed as #480 on the Fortune 500 listing. Graybar is an independent distributor and is still one of the largest employee-owned companies in the United States.
Board of directors
- Robert A. Reynolds, Jr., Chairman, President and Chief Executive Officer
- Richard A. Cole, District Vice President – Chicago District
- D. Beatty D’Alessandro, Senior Vice President and Chief Financial Officer
- Matthew W. Geekie, Senior Vice President, Secretary and General Counsel
- Lawrence R. Giglio, Senior Vice President – Operations
- Thomas S. Gurganous, District Vice President – Richmond District
- Randall R. Harwood, District Vice President – Dallas District
- Frank H. Hughes, President and Chief Executive Officer, Graybar Canada
- Robert C. Lyons, District Vice President – Tampa District
- Kathleen M. Mazzarella, Executive Vice President and Chief Operating Officer
- Richard D. Offenbacher, Senior Vice President – U.S. Business
- Beverly L. Propst, Senior Vice President – Human Resources
External links
- Graybar Home Page
- The Graybar Story
See also
- Western Electric CompanyWestern ElectricWestern Electric Company was an American electrical engineering company, the manufacturing arm of AT&T from 1881 to 1995. It was the scene of a number of technological innovations and also some seminal developments in industrial management...
- Elisha GrayElisha GrayElisha Gray was an American electrical engineer who co-founded the Western Electric Manufacturing Company...
- Enos Barton
- Anson StagerAnson StagerAnson Stager was the co-founder of Western Union, the first president of Western Electric Manufacturing Company and Union Army general, where he was head of the Military Telegraph Department during the Civil War.-Biography:...
- Graybar Building (New York City, New York)
- Graybar Electric Company BuildingGraybar Electric Company BuildingThe Graybar Electric Company Building is located at 55 W. Canfield in Detroit, Michigan. This warehouse building was rented to the Graybar Electric Company from 1926 into the 1940s. It was listed on the National Register of Historic Places in 1997....
(Detroit, Michigan)