MDM Podcast: The State of Distribution Innovation - Modern Distribution Management

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MDM Podcast: The State of Distribution Innovation

NAW’s Bart Tessel and Applico’s Alex Moazed share thoughts on distribution innovation and technology today as critical differentiators, and where they're headed.
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The word “innovation” is undoubtedly overused when discussing ways that businesses are formulating new strategies and ideas to move their organization forward. But until a better term comes along, it’s here to stay near the top of distribution nomenclature.

Innovation is always evolving for distributors. Vendor-managed inventory was innovative when it first arrived. So was eCommerce and next-day delivery. Given the pace of technological advancement and adoption throughout the industry, it’s always worth taking a zoomed-out view of where things stand today in distribution innovation and who is doing what to continue advancing it.

This was the focus of the latest MDM Podcast episode, which featured guests Bart Tessel, Chief Innovation Officer for the National Association of Wholesaler-Distributors (NAW), and Alex Moazed, Founder and CEO of Applico. Both of them have been deeply engaged in helping distributors manage disruptions and the industry’s greater digital transformation.

Alex Moazed

Moazed, co-author of “Modern Monopolies” — an Amazon best-seller (published in 2016) — noted in the podcast that despite the volume of recent innovation in distribution and the scale of the industry, the lack of venture capital funding to further tech advancement has been stunning.

“It’s just crazy that an $8 trillion industry — arguably the largest industry in the United States — has had a complete vacuum in terms of venture capitalists that are looking to invest in tech companies that are genuinely friendly to wholesale distribution,” he told MDM’s Tom Gale.

Seemingly for decades, the tech options at distributors’ disposal were built for retailers or manufacturers and either modified to best match distributors’ needs or plugged in as-sis. While that’s still an issue today, more and more tech vendors have built solutions built for distributors from the ground up, or are at least highly customizable for this industry.

Bart Tessel

“When it comes to innovation, these are super exciting times, because technology innovators have come to realize the potential of our industry,” Tessel said. “And they’re backed by investors that have started to develop B2B technology solutions. We no longer have to accept solutions that were designed for manufacturers or for retailers and have to figure out a way to make them our own. Distributors have started to realize the opportunity to not invent and customize everything ourselves, but to leverage expertise, ideas and solutions by partners”

NAW and Applico are about to host the second annual NAW Innovators Summit on Nov. 14-16 in Austin, Texas, which serves as an exclusive event for wholesale distribution executives, innovators and tech founders. Attendees will hear first-hand from fellow distributors, practitioners and tech providers on ways to innovate in their operations, marketplace and supply chains.

Gale had Tessel and Moazed touch on what they’ve seen in terms of distribution tech evolution over the past few years; how companies can create an on-ramp to leveraging today’s tech; and some of the assets available to help distributors determine which solutions are right for them.

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