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CORRESP
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    corres081009.htm

    August
10, 2009

    Mr.
Jeffrey Gordon

    Staff
Accountant

    Division
of Corporation Finance

    United
States Securities and Exchange Commission

    Washington,
DC 20549-7010

    RE:           DXP
Enterprises, Inc.

    Form 10-K for Fiscal Year Ended
December 31, 2008

    Form 10-Q for the period ended March
31, 2009

    Schedule 14A filed on April 29,
2009

    File No. 0-21513

    Dear Mr.
Gordon:

    I have
reviewed the comments contained in your letter to me dated June 25,
2009.  My responses are keyed to your comments.

    DXP
Enterprises, Inc. (“DXP”) acknowledges that:

              ·

              DXP
      is responsible for the adequacy and accuracy of the disclosure in our
      filings;

              ·

              Staff
      comments or changes to disclosure in response to staff comments do not
      foreclose the Commission from taking any action with respect to the
      filing; and

              ·

              DXP
      may not assert staff comments as a defense in any proceeding initiated by
      the Commission or any person under the federal security laws of the United
      States.

    FORM 10-K FOR THE YEAR ENDED
DECEMBER 31, 2008

    Item 7 – Management’s
Discussion and Analysis of Financial Condition and Results of Operations, page
11.

    Liquidity and Capital
Resources, page 14

              1.

              In
      future filings if it ever becomes reasonably likely that DXP will not
      comply with any significant covenant, DXP will provide comprehensive
      disclosures about the requirements, including disclosing the ratios/actual
      amounts versus minimum/maximum ratio amounts permitted under any and all
      material borrowings.  DXP understands it may also be necessary
      to show specific computations used to arrive at the actual ratios with
      corresponding reconciliations to US GAAP amounts, if
      applicable.

    Discussion of Critical
Accounting Policies, page 17

              2.

              DXP
      will disclose in future filings the deductibles associated with each risk
      for which it has significant deductibles (self insurance).  DXP
      will also quantify the dollar amount of its self insurance accruals for
      each period presented.

    Following
are the example disclosures regarding self-insurance reserves which will be
included in future filings:

    Self-insured
Insurance and Medical Claims

    We
generally retain up to $100,000 of risk for each claim for workers compensation,
general liability, automobile and property loss.  We accrue for the
estimated loss on self-insured portion of these claims.  The accrual
is adjusted quarterly based upon reported claims information.  The
actual cost could deviate from the recorded estimate.

    We
generally retain up to $100,000 of risk on each medical claim for our employees
and dependents. We accrue for the estimated outstanding balance of unpaid
medical claims for our employees and their dependents.  The accrual is
adjusted monthly based on recent claims experience.  The actual claims
could deviate from recent claims experience and be materially different from the
reserve.

    The
accrual for these claims at June 30, 2009 and December 31, 2008 were
approximately $1.0 million and $1.3 million, respectively.

    Goodwill and Long-lived
Asset Recovery, page 32

              3.

              DXP
      will consider disclosing the following in future
  filings:

              ·

              The
      reporting unit level at which DXP’s goodwill for impairment and its basis
      for that determination;

              ·

              Each
      of the valuation methodologies DXP used to value goodwill (if multiple
      approaches are used), including sufficient information to enable a reader
      to understand how each of the methods used differ, the assumed benefits of
      a valuation prepared under each method, and why management selected these
      methods as being the most meaningful for the company in preparing the
      goodwill impairment analyses;

              ·

              How
      DXP weights each of the methods used including the basis for that
      weighting (if multiple approaches are
used);

              ·

              A
      qualitative and quantitative description of the material assumptions used
      and a sensitivity analysis of those assumptions based upon reasonably
      likely changes; and

              ·

              How
      the assumptions and methodologies used for valuing goodwill in the current
      year have changed since the prior year highlighting the impact of any
      changes.

    In
particular DXP will:

              ·

              Explain
      how it identified reporting units

              ·

              Explain
      how it assigned assets, liabilities, deferred taxes and goodwill to
      reporting units

              ·

              Disclose
      significant assumptions, if
applicable

              o

              Use
      of an income based or market based
approach

              o

              Cash
      flows

              o

              Growth
      rates

              o

              Discount
      rates

              o

              Use
      of a weighted average cost of capital or a cost of equity
      method

              o

              Risk
      applications

              o

              Control
      premiums

    Item 8 – Financial
Statements and Supplementary Data, page 20

    General

              4.

              In
      future filings DXP will present its statement of comprehensive income
      within (1) its statement of operations, (2) its statement of equity, or
      (3) as a separate financial
statement.

    Report of Independent
Registered Public Accounting Firm on Financial Statements, page
21

              5.

              DXP
      confirms that its auditors conducted their audit in accordance with the
      standards of Public Company Accounting Oversight Board (United States) as
      required by PCAOB Auditing Standard No. 1.  DXP’s auditors will
      revise their audit opinions in future filings to indicate that the audits
      were conducted in accordance with the standards of the Public Company
      Accounting Oversight Board (United
States).

    Note 1 – Organization and
Significant Accounting Policies, page 28

    General

              6.

              DXP
      will disclose in future filings the types of expenses that DXP includes in
      the cost of sales line item and the types of expenses that DXP includes in
      the selling, general and administrative expense line item.  DXP
      will also disclose that DXP includes inbound freight charges and internal
      transfer costs in the cost of sales line item and includes purchasing and
      receiving costs, inspection costs, warehousing costs, and the other costs
      of its distribution network in the selling, general and administrative
      expense line item.   DXP will disclose in MD& A that
      its gross margins may not be comparable to those of other entities, since
      some entities include all of the costs related to their distribution
      network in cost of sales and others like DXP exclude a portion of them
      from gross margin, including them instead in selling, general and
      administrative expense.

              7.

              DXP
      will disclose in future filings that depreciation and amortization are
      included in cost of sales and in selling, general and administrative
      expense.

    Note 13 – Fair Value of
Financial instruments, page 44

              8.

              If
      material in the future, DXP will enhance its disclosure in future filings
      to provide a reconciliation of the beginning and ending balances of its
      fair value measurements using significant unobservable inputs in
      accordance with paragraph 32(c) of SFAS 157.  DXP will also
      present the disclosures required by paragraphs 32(d) and (e) of SFAS 157,
      as applicable.

    Note 16 – Quarterly
Financial Information (Unaudited), page 46

              9.

              DXP
      will present in future filings its basic earnings per share for each
      quarter presented.

    Item 9A – Controls and
Procedures, page 47

              10.

              On
      September 10, 2007, DXP completed the acquisition of Precision Industries,
      Inc.  Precision’s sales during 2006 were over $297 million,
      which exceeded DXP’s 2006 sales.  During 2008 DXP was working to
      convert Precision to DXP’s computer system.  In October DXP
      converted Precision’s general ledger, accounts payable and accounts
      receivable functions on to DXP’s system.  Later it became
      obvious we were not going to complete full conversion in
      2008.  We therefore began documenting, remediating and testing
      Precision’s internal controls.  We did not complete the
      documentation and testing of Precision’s internal controls until the end
      of January 2009.

              SEC
      rules require management to base its evaluation of the effectiveness of
      the Company’s internal control over financial reporting on a suitable,
      recognized control framework (also known as control criteria) established
      by a body or group that followed due-process procedures, including the
      broad distribution of the framework for public comment.  As the
      company had not completed its implementation of a control framework for
      Precision by December 31, 2008, our auditors concluded that a scope
      limitation existed.  According to AS5, appendix C, paragraph C3
      “The auditor can express an opinion on the company’s internal control over
      financial reporting only if the auditor has been able to apply the
      procedures necessary in the circumstances.  If there are
      restrictions on the scope of the engagement, the auditor should withdraw
      from the engagement or disclaim an opinion.  A disclaimer of
      opinion states that the auditor does not express an opinion on the
      effectiveness of internal control over financial
    reporting.”

    Item 15 – Exhibits,
Financial Statement Schedules, page 49

              11.

              DXP
      will file an amendment to correct
this.

              12.

              In
      future filings, DXP will file asset purchase agreements and similar
      agreements as number (2) exhibits pursuant to Item 601(b)(2) of Regulation
      S-K.

              13.

              DXP
      will file all of the exhibits and the schedules to the Credit Agreement
      dated August 28, 2008 (Exhibit
10.24).

    FORM 10-Q FOR THE PERIOD
ENDED MARCH 31, 2009

    Item 6 –
Exhibits

    Exhibit 32.1 – Certification
of Chief Executive Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002

              14.

              DXP
      will amend its filing and re-file exhibits 32.1 certifications with the
      correct dates.

    DEFINITIVE PROXY STATEMENT
ON SCHEDULE 14A FILED ON APRIL 29, 2009

    Compensation Discussion and
Analysis, page 9

    Incentive Cash Bonuses, page
10

              15.

              In
      future filings we would propose to include the additional disclosure along
      the lines of the following paragraphs as the first and second paragraphs
      under “Incentive Cash Bonuses”:

              Each
      of our Named Executives is eligible to receive an incentive cash
      bonus.  Under the terms of the employment agreement with our
      chief executive officer, he is entitled to receive a bonus of 5% of our
      profit before tax income, which is determined and paid on a monthly
      basis.  The Compensation Committee can decide to pay all or a
      portion of this bonus in the form of restricted stock.  The
      determination of whether the bonus is to be paid in cash or shares of
      restricted stock is be made prior to the date on which the amount of the
      bonus is determined.  If shares of restricted stock will be
      issued, the number of shares is determined by dividing the portion of the
      bonus to be paid in restricted stock by the closing price of a share of
      our common stock on the last day of the month for which the bonus was
      earned, rounded up to the nearest whole
share.

              Under
      the terms of the employment agreement with our chief financial officer, he
      is entitled to receive a bonus in cash of 0.75% of our profit before
      income tax, which is determined and paid on a monthly
    basis.

              At
      the beginning of each year, our chief executive officer makes a
      recommendation to the Compensation Committee, which the Committee reviews
      and approves,  regarding whether our other Named Executives will
      receive an incentive cash bonus and, if so, the amount of the bonus, which
      is a percentage of our profit before income tax, less a bogey, determined
      and paid monthly.  In 2009, the incentive cash bonus percentages
      for Messrs. Oliver, Vinson and Jeffery were 1.0%, 1.0% and 1.0%,
      respectively.  The amounts of the bogey were $20 million, $14
      million and $18 million,
respectively.

    Equity-Based Compensation,
page 10

              16.

              The
      value of the 9,680 shares of restricted stock awarded to Mr. Little was
      $100,000 on the grant date.  Sales increased 65.8% and net
      income increased 49.2% in 2008 from 2007, therefore Mr. Little earned the
      maximum award.  DXP confirms that the determination of the award
      amount for growth between 10% -20% is made on a straight line
      basis.

              17.

              In
      future filings, we will expand the disclosure regarding the equity awards
      to discuss the factors the Compensation Committee considered in
      determining the grant of equity-based compensation to our Named
      Executives.  An example of such expanded disclosure
      follows:

              First
      sentence:  The Compensation Committee awards equity-based
      compensation to reward past performance and to retain our Named Executives
      by granting awards that vest over
time.

              Penultimate
      sentence of first paragraph under “Equity-Based
      Compensation”:  The first award granted to Mr. Little under this
      program was a grant of 9,680 shares of restricted stock on March 31, 2009,
      which represented the full $100,000 award available due to the achievement
      by the Company of an increase in excess of 20% of both sales and net
      income.

              Last
      paragraph under “Equity-Based Compensation”:  The Compensation
      Committee determines whether grants of equity-based compensation will be
      given to the other Named Executives each year based on the performance of
      the Company as a whole, the performance of the business unit for which the
      Named Executive is responsible and the contribution that the Named
      Executive made to the Company, together with a recommendation of our chief
      executive officer.  No equity-based compensation awards were
      made to the other Named Executives during 2008 or based upon 2008
      results.

    Grants of Plan-Based Awards,
page 16

              18.

              In
      future filings we will include appropriate disclosure rather than refer to
      the disclosure in the Summary Compensation
  Table.

    Please
contact me at 713-996-4897 if you have any questions regarding this letter or to
confirm that the staff will have no further comments of our filing.

    Sincerely,

    /s/ Mac
McConnell

    Mac
McConnell

    Senior
Vice President & CFO

    MM:sb