Think Like a Futurist - Modern Distribution Management

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Think Like a Futurist

Everyone wants to know, what will our economic recovery from COVID-19 look like? The most optimistic are hoping for a V-shaped curve, others are expecting a W or even an L. When faced with an indeterminate outlook like we see today, information is key.
regard futuriste

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I’ve been hearing a lot of discussion around letters of the alphabet lately, and it’s not just coming from my kindergartner who is learning how to read. Everyone wants to know, what will our economic recovery from COVID-19 look like? The most optimistic are hoping for a V-shaped curve, others are expecting a W or even an L. When faced with an indeterminate outlook like we see today, information is key. 

In this issue, you will find the latest data from more than 600 respondents who participated in our quarterly MDM-Baird Distribution survey. Because of the coronavirus curveball, this special COVID-19 edition of the survey takes a broader look at trends in distribution as a whole right now, rather than breaking down the responses by industry sector. However, you will still find data charts showing revenue growth, selling price, next quarter and full-year forecasting by sector. 

While the first quarter of 2020 saw limited impact from COVID-19 and matched many distributor’s expectations, there was a rapid decline throughout March. On average, the first week of March saw 0.9% growth, but by the last week it was at -6.7%. The steepest decelerations throughout the month came from landscape supplies (-11.6%), OEM fasteners (-11.4%) and metalworking (-10.3%).

Survey responses reflect the reaction to this reality, with key themes of broad-based interruptions and closures, surging lead times and wide-ranging supply chain disruption, rising competitive pressures, cash-flow concerns and long-term share shift implications. Many noted they do not expect all distribution companies to emerge from the crisis intact. As one survey respondent put it, “High tide floats all boats; the tide is going out, let’s see who wasn’t wearing any pants.” 

If you’re looking for perhaps a more inviting visual, be sure to join our weekly MDM Live webcast sessions hosted by MDM CEO Tom Gale and Mike Marks, founder of Indian River Consulting Group. Every Friday at 2 p.m. Eastern, Tom and Mike are joined by a variety of industry guests who share their firsthand accounts dealing with office closures, spiking demand, furloughs and planning for an uncertain future. You can register for free at 

During a recent MDM Live, Jennifer Murphy, president of buying group NetPlus Alliance, made an excellent point about the entrepreneurial spirit of distribution prevailing. While her members have seen in some cases a 30% increase in orders, those orders are for 25% less volume. NetPlus is working with its members and suppliers to find creative ways to move product, she said. Its distributors are brainstorming how the group can help support suppliers in managing supply chain issues and provide a more accurate picture of need-based product. “Think like a futurist — all of the things within our industry that we could do that could be game-changing,” Murphy said, such as helping to develop anti-microbial surface technology and reusable personal protection equipment. 

With some states beginning to open back up, Murphy posed a question for us all to keep in mind, “We have to ask ourselves … how are we essential?” 

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