The 2020 Mid-Year Economic Update_long

Day: December 10, 2012

The Shifting Competitive Landscape: Introduction

This article is the introduction to the MDM series: The Shifting Competitive Landscape.

Most have heard the classic tale of Blockbuster, once the king of the video rental market, not responding to online rental service Netflix until it was too late. Or Sony’s failure to recognize the shift to digital music from tapes and CDs, moving Apple into mobile music market leadership with the iPod.

These stories remain some of the clearest examples of what can happen when your competitive focus is too narrow.

No company should outright ignore its traditional and long-standing competitors. But an ever-increasing pace of change, thanks in part to technology, dictates that distributors

Commentary: Adapting for 2013

As we approach the end of the fourth quarter, it is useful to review the year and think through scenarios for next year.

The first half saw manufacturing markets strong with some recent tapering or at least increased month-to-month volatility. Construction markets have been gaining momentum through the year. Specific energy markets continue to skyrocket.

Grainger’s Multichannel Model Builds Customer Loyalty, Stickiness

Graingers multichannel model lets customers be served the way they want to be served, according to Court Carruthers, Grainger U.S. president. He was speaking at the $8.1 billion distributors recent annual analyst meeting, available at grainger.com.

And it has allowed the distributor to adapt to changing economic conditions, Carruthers said.At the annual meeting, Graingers leaders provided an update on Graingers growth drivers, homing in on the concept of ...

Collaboration Case Studies: PM Industrial Supply and EDGE Investment Partners

This is part of the MDM series, The Shifting Competitive Landscape. Here are two more stories of distributors who are collaborating with competitors to bring value to customers or expand their reach. Read the other case studies from the Dec. 10, 2012, issue here.

PM Industrial Supply: Sharing Inventory with Competitors
Collaboration with competition can be a sensitive area, but for some distributors, it can help them serve their customers more effectively and efficiently. PM Industrial Supply Co., Chatsworth, CA, works with two “friendly competitors” in the area to get products they don’t carry, such as certain cutting tools.

“It really helps us compete with larger distributors, because it helps us be more of a one-stop shop for our customers,” says Zack Gerin, IT and marketing manager.

The service is not an advertised benefit

Collaboration Case Study: Expanding Product Mix

This article is part of the MDM series: The Shifting Competitive Landscape.

To expand the products it could sell without the expense of carrying inventory, San Antonio-based Labatt Food Service collaborated with Ace Mart, a restaurant equipment and supplies distributor. This case study looks at how the two approached the collaboration and the challenges that have gone with it. It also looks at a second collaboration Labatt has built with other distributors to serve customers that have moved to geographic areas it does not serve.

Restaurant equipment and supplies distributor Ace Mart’s original relationship with San Antonio, TX-based Labatt Food Service was as a traditional supplier and an occasional provider of special-order items. About six years ago, Ace Mart, which is based primarily online, proposed a way to simplify how customers can order Ace Mart products through Labatt.

Labatt’s customers are now able to

Collaboration Case Study: Sharing Branches, Best Practices

This article is part of the MDM series: The Shifting Competitive Landscape.

One of the most popular examples of a collaboration between distributors that has worked is that of APR Supply, Schaedler Yesco and Industrial Piping Systems in Pennsylvania. The three have 11 locations together, and continue to uncover new opportunities to benefit from the arrangement. They’ve inspired a new program from Affiliated Distributors called Co-Ventures. This article looks at why the distributors’ collaboration has worked and what to consider when going down a similar path.

Jim Hoffman saw a common thread in his first three clients after he launched his consulting business. “By the end of my first year working in those three companies, I thought, ‘Except for what’s in the boxes, they’re in the same business,’” he said. If he could get them to work together, he thought they could accomplish great things.

More than six years later, the co-venture between plumbing supplies distributor APR Supply Co., electrical distributor Schaedler Yesco and PVF distributor Industrial Piping Systems continues to grow. The three distributors also continue to uncover new ways to benefit from working together.

Today, the companies have 11 shared branches

Distributor Collaborations Build Value, Local Influence

This article is part of the MDM series: The Shifting Competitive Landscape.

The case studies in the Dec. 10, 2012, issue of MDM Premium, the first articles in MDM’s series on the shifting competitive landscape in wholesale distribution, feature distributors who are collaborating to compete more effectively.

These distributors are adding value to customer relationships by partnering with competing or complementary distributors to meet customers’ needs more effectively and efficiently. The collaboration includes integration across a wide spectrum, from selling another distributor’s inventory to opening branches together.

This growing interest in collaboration among distributors is changing the competitive landscape. If done right, it builds on the distributors’ value propositions and expands their influence in their local markets. This can pose a threat to competitors who may underestimate the impact such collaboration can have, not only through greater efficiencies, but also through increased revenues and greater stickiness with customers.

On a broader front, partnerships on a local level potentially take the edge off national distributors’ advantages of scale