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When we talk about the relationship between distributors and manufacturers, we often use the word "partners." But the word partner may imply a deepness to the relationship that isn't quite there, according to Bart Schwartz, president of Industrial Channel Research. Schwartz discussed how to improve channel relationships this week at the Industrial Supply Association Product Show & Conference in San Antonio.
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While manufacturers may think they have a great relationship with their distributors, the reality is that many of those distributors are dissatisfied with their situations, Schwartz says. On surveys conducted by ICR, distributor respondents rated their manufacturing partners as relatively neutral.
"That's not good," Schwartz says. "That's 'eh.'"
There are several reasons for this breakdown, but many of them center around the same concept: communication. If you don't communicate your needs to your partner – whether you're a distributor or a manufacturer – they won't know what you need, and they can't work with you to achieve mutually beneficial goals.
"A real partner realizes that we all have to make a living," says Chester Collier, senior vice president of global distribution for Walter Surface Technologies. "If they grind you to the ground on price, you won't be able to stay in business and keep serving them."
Partnerships require give and take. Manufacturers have to talk AND listen – and so do distributors.
Channel partnerships were the topic of Executive Briefing in the last year featuring Bob Conti. Watch his take on partnership from the perspective of the distributor and manufacturer: