GET PAID FOR THE VALUE YOU ADD
This article argues there is a better, more profitable approach than what many distributors have taken to pricing. The solution is to develop products and services that target unique segments with very specific offers. For most distributors, this involves developing a range of offers from the high end (with all the bells and whistles) to the low end (no frills).

For most distributors, this is a fundamentally new approach and supplants a basic one-size-fits all, volume-driven pricing model. The authors argue that even the most commodity intensive business can improve revenue, margins and profits by adopting a value-based strategy that targets specific market segments with products and services that drive the economics of their customer’s business. More...

SURVEY: ECONOMY, TAXES, MATERIAL COSTS TOP CONCERNS OF MANUFACTURERS
The three leading concerns of North American manufacturers are the general state of the economy, taxes and the cost of materials, according a study by the Small Business Research Board. Health care costs – which had been the top concern in the first quarter 2007 – moved down No. 6. Energy and fuel costs as well as finding quality employees ranked ahead of health care expenses.

Less than a third of respondents said they would expand in the next two years. Of those that will expand, 28% said they are considering expanding at current locations, while 21% said they would add more products and 20% said they plan to increase customer service, according to this IndustryWeek article. About 16% of respondents said they would add more services and just 7% said they would add locations. More...

EXPANDING THE USE OF VOICE TECHNOLOGY IN DCs
Southeast Frozen Foods' Miami, FL, Distribution Center has implemented a voice technology pilot project, where workers wear headsets that allow them to receive spoken instructions to where cases of ice cream or frozen vegetables belong, according to DC Velocity. The communication goes two ways – to respond to the system, the workers have only to speak into the headset's microphone and the system records the transaction. Voice technology used to be used primarily for picking applications, but its usage is spreading to other operational areas of a DC. More...

EMBRACE THE INTERNET IN YOUR DISTRIBUTORSHIP
Adam Fein, in his blog Distribution Trends says that wholesaler-distributors must fully embrace the Internet in their business operations now that it is a normal part of everyday life in the U.S. A recent survey by the Pew Internet & American Life Project found that nearly half of adults have high-speed Internet connections at home – up from a year earlier. Fein notes that online customer communities have especially caught on, including Contractor Talk, WeldTalk, JLC Online for lumber/drywall contractors, and Maintenance Forums.

In an earlier post, Fein addresses the risks of Chinese sourcing. "Many people are too quick to throw out overseas sourcing for political reasons," he writes. "Nonetheless, wholesaler-distributors will have to pay close attention to their sourcing partners or risk future liabilities." More...

FIRST FEDERAL MINIMUM WAGE HIKE KICKS IN
The new federal minimum wage hike went into effect Tuesday, the first in a series of wage increases, according to USA Today. The increase is for covered, non-exempt employees, who will now receive $5.85 an hour – up from $5.15. The next jump will happen July 24, 2008, to $6.55 an hour, and then $7.25 an hour in July 2009. These are the first increases since 1997. More than half of U.S. states already require a higher minimum wage – just 20 states are affected by the first wage hike of 70 cents.

Opponents to the wage increases say that the higher minimum wage could result in fewer hours for employees, fewer pay increases, benefits reductions, job losses and less job creation, USA Today reports. More...

SUPPLY CHAIN RISKS IN LATIN AMERICA
In Latin America, executives say regulatory concerns top the catalog of supply chain risks; in other regions, labor issues tend to top the bill, according to McKinsey Quarterly. Executives in Latin America are also more likely than their counterparts elsewhere to worry about foreign-exchange rates and fluctuations in commodity prices. This article goes over the findings of a 2006 survey risks, as well as the way companies manage these risks doing business in Latin America. More...

REXEL AND HAGEMEYER?
There are rumors out there that Rexel may once again be considering the idea of buying Hagemeyer NV, one of the world's largest electrical distributors. Apparently, Rexel's chief said the company was interested in more acquisitions; this sparked speculation among investors and raised Hagemeyer's stock price. While these kinds of rumors have come up before, we will still note that such a deal would put Rexel solidly in first place in the U.S. market and broaden its offerings in safety and industrial supplies, according to the blog Electrical Trends. More...