President's Blog

After months of preparation, the 2012 NAED National Meeting will be here on Wednesday.

For many leaders in our industry, attendance at this annual event is not an option. It's a must because it affords them the rare chance to catch up on key trends and issues as well as colleagues and prospects all at once.

We've worked hard at NAED to make sure your time in Washington D.C. is well spent by packing a lot of education, discussion and networking into three days.

You can see our schedule has a ton in store, from timely keynotes and to deep-dive think-tank panels to lively discussion on relevant topics like ESCOs, talent management, technology and the challenges of fine-print contracts.

As you're attending the sessions, you won't want to overlook these meeting aspects as well:

• The chance for face time. B2B booth sessions and peer-networking groups are great venues for catching up with familiar contacts, while getting to know new ones. Clear some afternoon time before sightseeing excursions to attend one of these meetings.
• The colorful name-tag ribbons. This is your chance to mingle with experts and professionals of all different backgrounds. From first-time attendees to counterparts in sister organizations -- and even colleagues from overseas -- this meeting brings together many perspectives. Review our attendee list , and be on the lookout for special ribbons tacked on to attendee name tags.
• The free food and drinks. You come to the National to get smart on the latest trends. But you also come to network! Be sure to stop in the breakfast, cocktail and desert receptions hosted by NAED's allied partners  and associate members. They are not to be missed!
• The moments of tribute. Once a year we take time to celebrate the hard work and contributions of our industry leaders with the bestowing of our NAED Annual Achievement Awards. Join us for this special closing ceremony-turned-bash featuring live entertainment from Bruce In The USA - The World's Number One Tribute to Bruce Springsteen and the E Street Band.
• The possibility of coming back. If the spirit of the nation's capital -- paired with our government affairs education session -- has you charged for change, come back to D.C. with us this July! The 2012 NAED Congressional Fly-In is your ticket to meeting with key lawmakers and their staff on issues that impact your business.
  

Look forward to seeing all of you this week. And be sure to drop me a line afterward, letting me know how your experience went.

By Ed Orlet, Guest Blogger 

According to the Washington Post’s Ezra Klein, there’s a new word in the Capitol Hill lexicon: Taxmageddon. At the end of 2012, a number of tax provisions are scheduled to change, expire or go into effect that could have an unknowable impact on the slowly recovering economy. These provisions include:

• Increase in the top marginal estate tax rate from 35 percent to 55 percent
• Increase in individual tax rates
• Expiration of the payroll-tax holiday
• Increases in tax rates on capital gains and dividend income

A number of these provisions are routinely extended at the last minute. Cuts to Medicare providers have been an issue since they were first enacted in 1997, but they have never happened. Policy makers call this the “doc fix,” which seems to indicate they never actually plan to cut the rates.

Congressional Republicans are working to avoid the cuts to military spending they agreed to in the recent debt ceiling debate. Some are estimating the debt ceiling will need to be raised again before the election, but that’s a crisis unto itself. Take a look at this chart via Klein’s Wonkblog from the Committee for a Responsible Federal Budget.  It details the changes scheduled to lead to Taxmageddon.

If you haven’t noticed, this is an election year. With divided government in DC, any progress towards averting Taxmageddon prior to the election is, let’s say, unlikely. Add to this “budgetary free-for-all” the United States’ recently earned dubious distinction for having the highest corporate tax rate on the planet, and you can see that the stakes of this debate will be very high.

While many policy makers -- including the president -- have called for cuts to the corporate tax rate (and elimination of “loopholes” read: deductions), Profit Planning Group estimates that more than half of NAED member companies function as “pass-through entities.” So cutting the corporate rate, raising the individual rates and limiting deductions will actually amount to a devastatingly large tax increase on pass-throughs.

Another variable for distributors to worry about in tax/budget reform is LIFO repeal. Repeal was once again included in the president’s budget blueprint, and it will be in play during the coming tax fight. Some policy makers paint LIFO as an “oil company tax break” since energy companies hold the greatest amount of LIFO reserves. Unfortunately, electrical distributors must avoid being collateral damage in the war against Big Oil.

Election day is November 6. The U.S. House of Representatives has scheduled 16 legislative days for its lame-duck session before the end of the year and Taxmageddon. That’s not a lot of time. If you thought the debt ceiling debate was the height of hysteria, you ain’t seen nothin’ yet.

Join other NAED members as they take their voices to Washington during the 2012 NAED Congressional Fly-in happening July 11-12. NAED staff will help prepare you with scheduling, training and background information. All you need to do is register and attend.

Ed Orlet is vice president, NAED Government Affairs. Contact him at governmentaffairs@naed.org.

It's hard to believe, but in just two weeks, we'll be kicking off the 2012 NAED National Meeting in Washington D.C. We have a lot of great educational and networking activities planned, including not one but two keynote speakers during our general session: leading political analyst Charlie Cook and top industry economist Eli Lustgarten.

One session I'm particularly looking forward to is the "Future of the Industry Think Tank Panel" led by Michael Marks, managing partner with Indian River Consulting. Mike is a well-known expert in our industry, and he's pulled together a great session lineup, featuring Bill Weisberg, CEO of Affiliated Distributors; Kathy Mazzarella, EVP & COO of Graybar; Barry Boyer, president & CEO of Van Meter Industrial; and Dominic Peileggi, chairman and CEO of Thomas & Betts.

We sat down with Mike to talk about the future and what meeting attendees can expect to get out of his seminar. Here's a look at what he had to say.
 
Q: Why talk about the future?
Marks: It's easy to get consumed in the day-to-day transactions and not make long-range planning an immediate priority. To me, it's much more interesting to see where our industry is going in the long run.

If you can figure out where there's going to be growth and where there's going to be atrophy, it's easier to decide where you want to invest, where you want to align your business, and where you want to actually pick your competitive ground, rather than react.

Q: What topics do you hope this panel explores?
Marks: I think people are going to be very interested in looking at the changing role of innovation. Typically, distributors have tried to sell service with excellent people. But if everybody's doing the same thing, price becomes the only differentiator, and we get into this race to the bottom. Distributors are looking for new ways to add value to customers, which takes some innovation.

For manufacturers, it's always been about "let's come up with another product or a line extension that we can sell." For them, we're going to spend time talking about how you add value within a market.

There's a whole bunch of options when it comes to innovation. In addition to how the industry adds value, we're also going to spend some time talking about business models, looking at what happened with Netflix, Kodak and other folks. It's always easy to see major change when it's in someone else's backyard. We'll apply this line of thinking to our industry.

Q: There are a lot of dynamics right now in the workforce. Will you be looking at workforce issues as well?
Marks: Yes, we're going through a second-generational transition, where the young guys from the '90s are now the older guys. We'll explore what comes next. When you start talking about working from home, collaboration and how technology has changed all this, I think it's all going to look a lot different.

Q: How will you approach this discussion? What kind of format can session attendees expect?
Marks: This is going to be fishbowl exercise. This is not a format where the audience asks the panelists questions; rather it's going to be a conversation between ourselves. We chose this because, when you think about it, some of the best content at NAED meetings takes place at the bar, with people sitting around having conversations as industry insiders. That's what this panel is going to be. You've got smart, experienced people, and they're going to be playing off each other and having a conversation about what they think the future will hold.

Q: Your panel is made up of industry heavy hitters. How did you choose the participants?
Marks: I wanted people who are well known and who are critical thinkers. I also wanted people that typically, your NAED audience doesn't get exposed to. For example, this is the first time we've had Bill Weisberg from Affiliated Distributors be here -- Bill is actually going out of his way to come into this. It's probably the first time any of the folks on the panel have spoken to an NAED audience, yet they're all very well known, and they're all respected. And they each have very different experiences.

Q: Anything else attendees should know?
Marks: I am highly confident that it won't be boring [laughs].