Canada’s wholesale trade sector saw a modest increase in November 2023, with wholesale sales (excluding petroleum, petroleum products, and other hydrocarbons, as well as oilseed and grain) rising by 0.9% to reach $82.5 billion, according to the latest data released on January 15, 2024, by Statistics Canada.
Sales Performance by Subsectors
Sales growth was observed in four of the seven subsectors, with notable contributions from the motor vehicle and motor vehicle parts and accessories subsector, as well as the building material and supplies subsector. The motor vehicle subsector experienced a significant rebound, reporting a 3.3% increase to $14.8 billion in November, following a decline in October. The building material and supplies subsector also showed strength, marking its second consecutive month of growth with a 1.8% increase to $12.3 billion.
The personal and household goods subsector reported a 1.5% increase in sales to $11.5 billion in November, driven by growth in the toiletries, cosmetics, and sundries industry, as well as the home furnishings industry group.
Regional Variances
British Columbia led the growth in wholesale sales, posting a 7.0% increase to $8.3 billion in November. Notable contributions came from the building material and supplies subsector, which saw a robust 10.4% increase to $2.3 billion. Ontario also contributed to the overall growth with a 0.9% increase to $42.4 billion, driven primarily by the motor vehicle and motor vehicle parts and accessories subsector.
In contrast, Quebec experienced a decline in wholesale sales, falling by 2.1% to $14.6 billion in November. This downturn follows a significant increase in October, with sales decreasing across all seven subsectors, especially in the food, beverage, and tobacco subsector.
Inventory Dynamics
Inventories in the wholesale trade sector decreased by 1.5% to $127.9 billion in November. The machinery, equipment, and supplies subsector saw the most substantial decline, dropping by 3.1% to $37.9 billion. The building material and supplies subsector also reported a 3.0% decline in inventories, falling to $21.9 billion.
The inventory-to-sales ratio, a key indicator of inventory management, decreased from 1.58 in October to 1.55 in November. This suggests a slightly more efficient turnover of inventories, indicating a reduced time required to exhaust stock if sales were to remain at current levels.
Annual Comparison
On an annual basis, wholesale sales (excluding specified products) were 0.2% lower in November compared to the same month in the previous year. This indicates a relatively stable performance, with the sector navigating through challenges and changes in consumer and market dynamics.
In conclusion, while the Canadian wholesale trade sector experienced modest growth in November, variations across subsectors and provinces highlight the ongoing impact of market dynamics. The rebound in motor vehicle sales and sustained growth in building materials contribute to a cautiously optimistic outlook for the sector in the coming months.