Industrial Distribution recently published an article about distributors remaining optimistic this year (read it here: Distributors Remain Optimistic About 2014 After Sluggish Quarter). While it's great that industrial distributors are optimistic about 2014, there are some nagging concerns about their financial success for the long-term.
What is the impact of manufacturers "going direct" to business customers? This is a real phenomenon that some manufacturers are successfully employing to cut distributors out of the equation. Distributors need to be proactive to keep their customers and continue to exceed their expectations.
There is also a concern about e-commerce growth in the B2B sector by companies like AmazonSupply and Google. It is not yet known how successful these giants of retail will be in this marketplace, but it's hard to bet against them. Once again, distributors must be proactive in order to effectively compete. Going head-to-head on price or delivery is a real challenge.
Distributors need a well thought-out business strategy to combat these factors. They also need a supply chain that is aligned with that strategy to optimize the customer experience. Failing to develop a sound business strategy and aligning the supply chain leads to suboptimal results.
Tompkins International has been helping companies with business strategies and supply chain alignment for years. Contact us to see how we can help.