BAMKO’s 2020 (Non-PPE) Promotional Products Sales Increased by 11%, Overall Sales Up 88% to $202M: Analysis
We've watched BAMKO closely over the last year, as the Los Angeles-based distributor has been one of the promo industry's biggest success stories during the pandemic. The company's 2020 second-quarter revenue was up 218% over 2019, while its third-quarter revenue was up 67%. Much of that came from PPE, but the company reported consistently strong non-PPE sales over the year. Now, we have BAMKO's full-year results, giving us a complete picture of the distributor's sales and telling us more about the industry's path to recovery.
In an earnings call Monday, Jake Himelstein, chief operating officer and chief financial officer for BAMKO, laid out the company's results: fourth-quarter sales up 52.5% year over year (to $56.3 million), full-year sales up 88% over 2019 (to $202 million). These numbers are tremendous, but not surprising for anyone watching BAMKO's trajectory over the year.
What may be surprising, though, is that BAMKO's non-PPE promotional products sales increased by 11.1% year over year. That's the single best quarter of traditional promo sales the distributor has ever had. Considering the pandemic's impact on the industry, with overall sales down by as much as 30%, this is significant. It also gives us some valuable insights into what's working in promo as the industry looks toward a post-PPE future.
We explored some of these before after BAMKO's February acquisition of Gifts By Design, a distributor focusing on awards, recognition and incentives. But Himelstein said much of BAMKO's 2020 and fourth-quarter promo sales success came from a diversified client portfolio that includes companies in the gig economy, as well as home gifting, customer retention programs, customer acquisition, reacquisition programs, virtual conference gifts and gift-with-purchase items for consumers.
Himelstein also said BAMKO is also far less dependent on trade shows and events than many other distributors. And the company has spent years developing its sourcing capabilities and investing in technology and distribution, allowing it to adapt quickly when the pandemic hit.
"We kept working, experimenting and adapting, and doing everything we could to preserve jobs and generate opportunities for our sales team instead of sitting on our hands and 'waiting for things to come back,'" Himelstein told Promo Marketing.
"The speed and urgency with which we were able to pivot allowed us to capitalize on opportunities that others were too slow or indecisive to arrive at," he added. "Critical to all of that was an infrastructure that we’ve spent several years making major investments in. By the time the pandemic rolled around, BAMKO had built up technology, overseas sourcing and warehousing infrastructure that was superior to that of all of our competitors. That long-term perspective on growth paid off in a major way in 2020, allowing us to leverage those resources and capabilities to capitalize on opportunities for both PPE and to sell traditional promo to customers whose existing suppliers were falling down on the job."
BAMKO also reported a $45.5 million year-end backlog—its largest ever. Just $5.6 million of that is PPE, compared to $39.9 million in traditional promo, indicating a continued transition away from PPE. (We've seen this on the supplier side as well, with Hanesbrands announcing last month that it would begin exiting the PPE business.) Elsewhere, Superior Uniform Group, BAMKO's parent company, saw 21% growth in its uniforms segment, which Himelstein attributed to essential retail segments like pharmacies, grocery chains and big box retailers.
It will be interesting to see how BAMKO's 2020 results stack up against other large industry distributors. Some, like Proforma and HALO Branded Solutions, have reported strong sales, though we won't have exact numbers until our 2021 Top Distributors list releases this summer. Other large distributors struggled early in the pandemic, though some, like 4imprint, rebounded later in 2020. BAMKO's $202 million in sales last year would have ranked No. 8 on our 2020 Top Distributors list, a seven-spot jump from the company's No. 15 finish.
We'll see how things shake out. In the meantime, BAMKO's 2020 success is worth studying as the promo industry moves further into 2021.