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What May Mean for Independent Distributors

Readers Respond: The New

Readers Respond: The New

May 8, 2012

Over on MDM’s Independent Distributor Network group on LinkedIn, we have an ongoing discussion on the potential impact of, a new B-to-B website where Amazon is selling more than 500,000 industrial and lab products. (Join MDM’s nearly 2,500 group members on LinkedIn.)

Reactions to the announcement from Amazon were varied.

While some said that the announcement of may have limited impact due to the different nature of B-to-B markets, Brent Grover of Evergreen Consulting wrote: “I think Amazon’s effort is the real deal. It’s not easy to make a dent in a $100 billion market however there is plenty of room for a significant volume with a niche strategy.”

Some of the distributors and manufacturers in the group said they were unsure business customers wanted to do business the Amazon way. “Do most businesses really like to order parts and supplies online with a credit card these days? Don’t most of them prefer to pick up a phone to order, and receive an invoice they can sit on for 60 days plus before parting with the money?” one reader wrote.

Scott Benfield of Benfield Consulting also commented on the potential impact of “Amazon has no outside sellers, few inside sellers, no extensive brick and mortar network, and no counter sales. You will find, in our work, where 40 percent of outside sales territories lose money, most counter sales lose money, and brick and mortar locations are yesterday's value proposition. In essence, Amazon has a Transactional Model and it is low cost but they will get volume and, despite the thoughts of many wholesalers, they don't have to have lots of sellers and branches to do it.”

But a manager of one distributor said that if a company needs a product same day to complete a job on time, Amazon may not be the solution.

What do you think? Join the conversation on LinkedIn.

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