WASHINGTON — In an era dominated by digital automation, e-commerce portals, and algorithm-driven discounting, the wholesale distribution sector continues to beat to a surprisingly traditional drum. According to a comprehensive new industry report, when it comes to the heating, ventilation, air conditioning, refrigeration (HVACR), and plumbing sectors, customer relationships and high-touch service remain the ultimate currency—far outranking rock-bottom pricing or instantaneous quote turnarounds.
The findings come from The State of Sales in Distribution 2026, a recently published report by Phocas Software, a leading provider of business intelligence platforms tailored for middle-market distributors. Drawing from a targeted survey of more than 100 wholesale distributors—with HVACR and plumbing enterprises accounting for nearly a fifth of the respondent pool—the study offers a rare, data-driven window into the evolving sales strategies, technological adaptations, and operational blind spots defining the modern supply chain.
While the broader distribution landscape is rapidly experimenting with artificial intelligence and digital transformation, the foundational mechanics of how trade professionals buy equipment, parts, and supplies remain stubbornly rooted in human connection.
Main Facts: The Human Element Still Dominates HVACR and Plumbing
At the heart of the report’s findings is a striking reality check for hyper-digital retail models: business-to-business (B2B) distribution in the mechanical trades is fundamentally a relationship business.
When asked what their customers value above all else, 43% of HVACR and plumbing distributors pointed directly to service and relationships. By contrast, only 14% of respondents in these sectors stated that the "best pricing" was their customers’ top priority. An equal percentage (14%) highlighted technical expertise, while 29% cited multi-category convenience as the primary driver of customer loyalty.
Notably, not a single HVACR or plumbing distributor surveyed indicated that a fast turnaround of quotes and orders was their customers’ top priority. This stands in stark contrast to other sectors; for instance, 40% of electrical equipment distributors surveyed named rapid quote and order turnaround as the premier concern for their client base.
This divergence underscores the unique nature of the HVACR and plumbing trades. Contractors, technicians, and project managers dealing with complex installations, retrofits, and emergency repairs often require consultative guidance, precise product matching, and troubleshooting support—areas where automated e-commerce setups frequently fall short.
Chronology and Research Methodology: How the 2026 Report Came Together
To understand how distribution sales teams are navigating the mid-2020s business climate, Phocas Software initiated a multi-faceted research initiative concluding in early 2026.
- Phase One — Survey Design and Deployment: Phocas developed a comprehensive multiple-choice and qualitative survey targeting middle-market wholesale distributors across North America and key international markets. The survey instrument was crafted to measure shifts in sales channel effectiveness, customer prioritization, core metric tracking, and the integration of emerging technologies like artificial intelligence.
- Phase Two — Data Collection: More than 100 wholesale distributors completed the comprehensive questionnaire. The respondent base was diversified across multiple verticals, including industrial supplies, electrical equipment, consumer goods, and construction supplies, with HVACR and plumbing distributors representing 19% of the total dataset.
- Phase Three — Analysis and Benchmarking: Analysts cross-referenced responses to identify correlations between technology adoption (such as AI and CRM tools), metric tracking discipline, and stated business priorities (such as new customer acquisition versus account expansion).
- Phase Four — Publication: The State of Sales in Distribution 2026 was officially released to the public and industry stakeholders via the Phocas Software resource network, providing executive leadership with actionable benchmarks for modern sales performance.
Supporting Data: A Deep Dive Into the Numbers
Beyond the core customer preference metrics, the report paints a fascinating picture of an industry caught between high-tech modernization and foundational operational gaps. The data reveals critical insights across technology adoption, performance tracking, and sales channel efficacy.
The AI Paradox and Core Performance Metrics
While 49% of all distributors surveyed are actively using artificial intelligence for selling—with another 29% planning to implement AI within the next six months (leaving only 22% with no plans to adopt)—many sales organizations are simultaneously overlooking basic performance metrics.
The disconnect is stark:
- 39% of distributors do not track sales forecasting accuracy.
- 34% fail to measure their new business win rates.
- 32% do not measure win rates for existing business.
- 27% do not track customer retention rates.
This indicates that while companies are eager to invest in forward-looking software tools, foundational sales hygiene remains inconsistent across the middle market.
Channels of Influence: Field Sales Rule, E-Commerce Lags
Despite the relentless expansion of digital storefronts, field operations remain the undisputed heavyweight champion of distribution sales.
- 55% of distributors named field or outside sales as their most effective sales channel.
- Conversely, only 5% pointed to e-commerce as their primary driver of sales effectiveness.
When evaluating what makes an individual sales representative successful, respondents overwhelmingly pointed to deep industry knowledge. Three-quarters (75%) of distributors ranked strong product and usage knowledge among the most important attributes of an effective sales rep, placing product expertise far ahead of any other individual skill set.
The New Business Discipline Divide
The report also uncovered a behavioral trend regarding how companies pursue growth. Distributors who designated new customer acquisition as their top corporate priority demonstrated significantly higher discipline in tracking their performance.
Among those prioritizing new growth, 87% track their new-business win rate. In sharp contrast, only 46% of distributors who prioritize expanding accounts with existing customers track their win rates with the same rigor.
Pricing Realities Across Verticals
While HVACR, plumbing, and industrial distributors lean heavily on service, relationships, and product expertise, price sensitivity is not dead across the broader wholesale ecosystem.
When analyzing cross-industry data, 50% of respondents distributing consumer goods stated that their customers value the best pricing above all else. Consumer goods stood alone as the only vertical surveyed in which pricing was cited as the dominant customer priority, proving that the "service over price" dynamic is heavily dictated by the complexity and technical nature of the products being sold.
Official Responses and Industry Perspectives
The release of The State of Sales in Distribution 2026 has sparked significant conversation among supply chain leaders, software developers, and executive management teams. Myles Glashier, CEO and co-founder of Phocas Software, emphasized that the data ultimately validates the enduring importance of human-to-human interaction in wholesale trade.
"Our report highlights that product expertise and face-to-face selling continue to define distribution sales," said Glashier. "Distribution-specific AI can build on these strengths by giving sales reps faster access to reliable information about products and performance down to the SKU level. This will help them sharpen their sales approach and make better decisions when they are with customers or talking to them on the phone."
Glashier noted that the integration of artificial intelligence should not be viewed as a replacement for the traditional sales force, but rather as an empowerment tool designed to eliminate administrative friction and provide instantaneous, data-backed insights during customer interactions.
Addressing the technological divide among adopters, Glashier pointed out that companies already leveraging AI see team collaboration as the primary vehicle for improvement. Among AI-adopting distributors, 40% stated that greater collaboration across the business is the capability that would most improve their sales performance. Conversely, distributors who have not yet adopted AI remain focused on operational fundamentals, such as improving Customer Relationship Management (CRM) adoption and refining account prioritization strategies.
"Our latest report is designed to share insights on current sales techniques and gives sales leaders a benchmark for how the industry is selling now and ways it can improve," Glashier added.
Implications: What the 2026 Findings Mean for HVACR and Plumbing Distributors
The conclusions drawn from Phocas Software’s study carry profound strategic implications for executives, sales managers, and independent operators navigating the HVACR and plumbing supply chains. As the industry looks toward the remainder of the decade, several key takeaways emerge for businesses seeking sustainable growth and competitive advantage.
1. Double Down on Consultative Expertise
With 75% of distributors emphasizing product and usage knowledge, companies must invest heavily in continuous education for their sales teams. In technical trades like HVACR—where equipment efficiencies, refrigerant transitions, and complex system integrations dictate success—contractors do not just need a box mover; they need a technical partner. Distributors who position their outside sales reps as trusted advisors will continue to insulate themselves against pure price-cutting competitors.
2. Bridge the Metric Gap
The finding that roughly one-third to nearly 40% of distributors fail to track core metrics like forecasting accuracy, win rates, and retention highlights an urgent need for internal accountability. Implementing business intelligence (BI) tools that automate metric tracking can transform raw transactional data into actionable strategies without placing an undue administrative burden on sales staff.
3. Leverage AI as an Assistant, Not a Replacement
Because field sales remains the dominant and most effective channel (at 55%), technology strategies must support, rather than bypass, the outside sales rep. AI platforms that aggregate SKU-level data, predict purchasing patterns, and streamline quoting processes will empower field teams to spend more time building relationships face-to-face and less time digging through disparate databases.
4. Recognize Vertical Nuances
Finally, HVACR and plumbing executives must remain mindful that industry-wide generalizations do not apply universally. While consumer goods distributors must constantly fight margin compression driven by price-sensitive buyers, mechanical and plumbing distributors operate in a high-stakes, problem-solving ecosystem. Protecting margins by emphasizing service, technical support, and multi-category convenience remains a proven path to long-term profitability.
As the supply chain landscape continues to mature in 2026 and beyond, companies that successfully marry traditional high-touch relationship-building with modern, data-driven sales intelligence will be best positioned to lead the market.
