Distribution Solutions Group Inc. reported first-quarter revenue growth, highlighting the growing impact of its ecommerce and digital integration initiatives across its industrial distribution business lines.
Distribution Solutions posted Q1 revenue of $478.0 million. That’s up 14.9% from $416.1 million in the first quarter of 2024, with contributions from both organic growth and recent acquisitions.
While Distribution Solutions does not separately report online revenue, executives and analysts emphasized that ongoing investments in digital commerce are playing a larger role in customer acquisition, retention, and margin expansion — particularly in complex, contract-driven markets such as electronic components, manufacturing, and maintenance, repair and operations (MRO).
“We are building platforms that increase automation, enhance visibility, and make it easier for our customers to do business with us digitally,” said Bryan King, CEO and chairman of the board. “We are focused on creating modern, customer-specific experiences that support high-volume, technical procurement processes.”
Distribution Solutions Group — formed through the strategic combination of Lawson Products, Gexpro Services, and TestEquity — is developing a unified digital platform that supports global customers across the MRO, OEM, and electronics markets. Though the company has not disclosed the share of total revenue processed through digital channels, executives say improvements in online transaction volume, portal usage, and electronic data interchange (EDI) are underway across all business units.
Distribution Solutions grows revenue through digital channels
The company has made key digital advances:
- Gexpro Services, the company’s original equipment manufacturer (OEM) supply chain solutions business.
Delivered $118.9 million in first-quarter sales. That’s a 20.6% increase from a year earlier. Analysts attributed the growth in part to increased adoption of embedded procurement technologies.
“Gexpro is doing more than shipping parts — they’re becoming digitally embedded in customers’ production lines through enterprise resource planning (ERP) integration, vendor-managed inventory, and automated reordering systems,” said Nathan Jones, analyst at Stifel Financial Corp. - TestEquity, which distributes electronic test and measurement equipment.
Generated $188.8 million in sales in the first quarter, up slightly from $187.1 million in the same period last year.
“TestEquity has made visible strides in digital search, pricing tools, and customer-specific configuration,” said Michael Kent, senior analyst at Robert W. Baird & Co. “It’s a move away from old catalog models toward a personalized digital storefront for engineers and procurement professionals.” - Lawson Products, which focuses on the MRO sector.
Posted $120.5 million in first-quarter revenue, up 1.9% year over year. King said mobile ordering, customer-specific catalogs, and streamlined checkout tools are gaining traction with professional contractors and industrial buyers.
“We are enhancing self-service while supporting complex orders through digital and field sales collaboration,” he said.
“This is not an ecommerce story in the traditional retail sense,” said Baird’s Kent. “What DSG is building is a vertically integrated, digitally enabled supply chain ecosystem. They’re using technology to increase stickiness and efficiency in highly engineered environments.”
“As we continue to integrate our 2024 acquisitions and invest in digital capabilities, we’re confident in our ability to deliver higher-margin growth,” King said. “Digital is a core part of how we serve customers — and how we differentiate in the market.”
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