October 25, 2012 - Modern Distribution Management

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October 25, 2012

MDM Interview, Part 2: Vallee Reflects on Changes in the Industry

In November, Roy Vallee, executive chairman of electronics distributor Avnet (NYSE: AVT), will retire after 35 years with the company. He served as COO and then president from 1992 until July 2011. Vallee saw Avnet grow from a $2 billion company to a $26 billion company. He recently spoke with Associate Editor Jenel Stelton-Holtmeier about how the industry has changed over the past 35 years, where he thinks it’s heading and provides advice for the next generation entering the industry. Part 1 of this interview appeared in the Oct. 10, 2012, issue of MDM.

MDM: In our podcast (available at mdm.com/7Minutes) you identified automation as the biggest industry change you’ve seen in your career. Could you talk more about the other changes you’ve seen?

Roy Vallee: How we operate is so much different today. We used to have inventory in every branch. It was difficult to find and transfer inventory between branches, and in order to fill a single customer order, we would often have to ship product from multiple branches to get the total quantity that we were looking for. Now with …

Download This Issue in PDF: Oct. 25, 2012

This is the PDF of this issue of Modern Distribution Management.

Table of Contents:

  • Lowered Expectations in 3Q13 MDM-Baird Distribution Survey
  • Commentary: Time to Move Past 'Election Paralysis'
  • Avnet's Roy Vallee on Changes in the Industry
  • State of Distributor Merchandising

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The State of Distributor Merchandising

A joint MDM-Real Results Marketing survey revealed that most distributors don’t view in-store marketing and merchandising as a core competency. The authors of this article argue that it should be, and that smaller and mid-size distributors have significant opportunity to improve in-store revenue through more effective and strategic use of displays.

Although e-commerce initiatives are front and center for many distributors today, in-store revenue remains essential. Yet most distributors with walk-in trade place limited emphasis on in-store marketing and merchandising. Analysis from a recent MDM survey showed that many of the merchandising decisions are decentralized, or left up to the location manager, including which products to feature, how often to rotate featured products and planograms, or shelf layouts.

Furthermore, while distributors value the expertise and involvement from …

Commentary: It’s Time to Move Past ‘Election Paralysis’

Forty-four percent of respondents to the quarterly MDM-Baird survey featured in this issue said they had deferred business decisions pending the results of the election, including hiring and investment spending, as well as employee compensation.

Respondents explained:

“Many customers are waiting to see what happens in November.”

“A lot of jobs are pending due to election paralysis.”

While it’s true that the election …

Third Quarter MDM-Baird Distribution Survey: Lowered Expectations

Robert W. Baird & Co., in partnership with Modern Distribution Management, conducted a survey of more than 500 distributors and manufacturers to gauge business trends and the outlook for the distribution industry in diverse sectors. Here is a summary of third-quarter results and distributor and manufacturer expectations for the fourth quarter and full year of 2013.

The results of the third-quarter 2012 MDM/Baird Distribution Survey represent lowered expectations compared with past results. According to the survey, third-quarter revenues were up 4.1 percent overall for respondents, lower than the expected 5.5 percent growth.

Respondents expect revenues to grow 2.4 percent in the fourth quarter 2012 and 3.6 percent in 2013. The annual forecast is …

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