North American promotional products distributors’ sales were down 28.9% year over year in July, an improvement from the 44.4% plunge in Q2 compared to the same period the prior year.

That’s according to ASI’s just-released Distributor Sales Survey, which showed that sales were up for 17% of distributors in July, nearly double that of Q2.

The Counselor Confidence Index, which measures distributors’ financial health and optimism, rebounded to 73 from a record low reading of 54 in Q2. That’s still far below the baseline of 100 established at the index’s founding 19 years ago.

For the rest of 2020, distributors appear to expect a small bounce back from Q2 lows, but are still collectively predicting that annual sales will, on average, be down about 35% compared to 2019. Almost 80% of distributors anticipate a decrease in 2020 sales.

“While a near 30% year-over-year decline may not seem like good news, there is a bit of hope in the air, as at least for right now, the worst appears to be behind us,” says Nathaniel Kucsma, ASI’s executive director of research and corporate marketing.

Chicago-based Printable Promotions (asi/299458) has mirrored the industry’s small step toward recovery. While sales plummeted 84% in Q2 from Q1, the company has seen a slight uptick month over month. June’s sales were down 52% from May, and July’s sales were down 22% from June.

“We’re hopeful to get back some of the losses from the past quarter,” says Mitch Silver, vice president of marketing at Printable Promotions. “We continue to be aggressive in our marketing to existing clients since we are diversified pretty well and some groups are buying. Clients are opening up to new ideas since they have given up hope that the old ways of doing business, such as face-to-face events, will return anytime soon.”

Although the industry’s quick pivot to selling personal protective equipment (PPE) provided a lifesaver to many companies, demand has largely diminished since the COVID-19 outbreak began. For Top 40 distributor Quality Logo Products (asi/302967), only 36% of sales in Q2 can be attributed to masks, face shields and other PPE.

“Many of our customers’ buying habits – sans those that relied heavily on trade shows – honestly remains unchanged,” says Bret Bonnet, president of Quality Logo Products. “I think we’ll end the year down somewhere between 30% and 40%. It’s tough to say because we’ve got some big projects in the works, some of which even in an up year would be transformative to our bottom line, so we’re still holding onto hope we could possibly beat 2019 figures, depending if we’re able to close those deals.”

Thanks to having several clients whose businesses have been deemed essential, Memphis, TN-based Signet Inc. (asi/326636) suffered little damage in Q2 compared to the rest of the industry – sales were only down 10%. Traditional promo sales kept coming in, as clients ordered new hire kits, awards and appreciation gifts.

“Signet sees our logistics, special handling and fulfillment services giving us an edge as the virtual world requires not just bulk delivery, but placing promo products in the hands of employees who are working from home all over the country,” says Elizabeth Tate, CEO of Signet. “Our business is really picking up – we are experiencing lots of quoting activity and inquiries. Our clients now have a clearer picture of what to do moving forward through the end of the year, so they can better plan.”