Nissa LaPoint, Author at Modern Distribution Management

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The Ongoing Shale Gas Opportunity

Distributors continue to home in on the booming domestic oil & gas market, driven by gains in oil and gas shale exploration and production. They say that despite concern over possibly stiffer regulations and environmental challenges, these markets continue to grow faster than other end-markets and hold potential for growth down the road.

The oil and gas market has always been a focus for GHX Industrial Inc., a Texas-based industrial distributor, but when a new technology to extract gas from shale in the U.S. emerged over the past decade, the company aggressively expanded its industrial hose and gasket business into new geographic markets.

Many distributors like GHX Industrial have benefited from …

Economic Trends

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The Impact of Rare Earth Price Volatility on Distributors, Manufacturers

Jaw-dropping price increases for rare earths the last few years sent distributors selling related products searching for ways to survive the volatility, with demand for the vital mineral fluctuating and supply declining. This article examines the impact of this volatility on electrical distributors and manufacturers.

In response to the market’s unprecedented price hikes – rising by as much as 500 percent – distributors that depend on rare earth metals have had to raise prices while looking for alternative suppliers and possible substitutes.

Rare earths are an abundant group of metals important to the manufacture of electronic goods, including flat-screen TVs and cell phones, to industrial products such as jet engines, lasers and fluorescent lights. It’s also become an irreplaceable metal used in clean energy products such as hybrid and electric vehicles, LEDs and wind turbines.

Sales & Marketing

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Building a More Profitable Supply Chain

In the recent MDM Webcast, Operating for Profit: The Coming Revolution in Supply Chain Finance, Jonathan Byrnes, senior lecturer at MIT and author of “Islands of Profit in a Sea of Red Ink,” said companies need to take advantage of a new approach to their supply chains that can grow profitability and tighten relationships with customers. Here’s a summary of the webcast, now available on-demand or on DVD at www.mdm.com/operatingforprofit.

Imagine what your competitor could do in terms of customer service that would be your worst nightmare.

Jonathan Byrnes, senior lecturer at MIT, posed this scenario to attendees of the recent MDM Webcast, Operating for Profit: The Coming Revolution in Supply Chain Finance. When he’s asked his students in the past, he said the answer from many has been a competitor finding a way to provide service that made a customer or vendor better off in ways their companies could not.

Companies can in fact accomplish this before a competitor beats them to it, he said. “Supply chain management today can have ...

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Inventory: The Good, The Bad and The Ugly

There’s always room for improvement in inventory management no matter the size of the company. Jon Schreibfeder, president of Effective Inventory Management and author of Achieving Effective Inventory, shares the first steps a company should take to manage its inventory. Schreibfeder was featured in a recent MDM Webcast, Inventory Management Best Practices for 2012, available at www.mdm.com/inventory.

For wholesale distributors, managing inventory effectively is essential for profitability. After all, the heart of most distributors’ businesses is the warehouse.

But not all distributors know how to effectively manage their company’s inventory, says Jon Schreibfeder, president of Effective Inventory Management, Inc., and author of Achieving Effective Inventory.

In the recent MDM Webcast, Inventory Management Best Practices for 2012, Schreibfeder presented an approach to separating inventory as a way of determining its profitability. In order to gain effective management over a company’s inventory, business leaders need …

Sales & Marketing

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Four Barriers to Distributor Profitability

In a recent MDM Webcast, How to Lead a Profitability Turnaround, Jonathan Byrnes, senior lecturer at MIT and author of Islands of Profit in a Sea of Red Ink, presents the four barriers to profitability many companies face. Access this webcast on DVD or on-demand at www.mdm.com/profitability.

Hurdles that prohibit or slow a company’s ability to raise profits do not develop overnight.

“It’s a legacy of a major change in the nature of the era of business that we’re in that’s happened in the past 20 or 30 years,” said Jonathan Byrnes, senior lecturer at MIT and author of Islands of Profit in a Sea of Red Ink. The history of business from the 1900s to today reveals the key avenue by which companies became successful was economies of scale, so

Top Distributor Sectors

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Womack’s Priority: Company Culture

Womack Machine Supply’s plans for rapid growth may mean the company’s traditionally close culture will change over time. CEO Mike Rowlett decided he wanted to work to make sure Womack remained a positive place to work despite its growth. He appointed a Vice President of Culture and pushed forward initiatives to make culture a more formal part of the distributor’s plans.

Company Profile

Company: Womack Machine Supply
Headquarters: Farmers Branch, TX
Leadership: CEO Mike Rowlett, President Art Kostaras
2010 Revenues: $134 million, up 7.2%
Details: Womack Machine Supply is an industrial distributor of supplies and components for hydraulic, pneumatic and automation control systems. It is No. 36 on MDMs list of the Top 40 Industrial Distributors.

Near his office sits one of CEO Mike Rowlett’s most important pieces of office equipment: an ice cream machine, which he purchased when he bought …

Technology

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Emerging Technologies Series: The Growth of Cloud Computing

This is the first in a series of articles looking at emerging technologies increasingly used by distributors in their businesses. This article looks at cloud computing, which continues to grow in popularity as a way to deliver business processes over the Web.

Full Emerging Technologies Series is available here.

Software as a service (SaaS) is anticipated to grow 20 percent to $12 billion in revenue this year, according to IT research company Gartner.

Yet in an industry with tight margins and a reluctance to invest in new technologies, SaaS, a variation of cloud computing that is the use of Web-based services to support business processes, is viewed with a critical eye among distributors.

But as more companies adopt cloud technology for their business, the service is becoming difficult to ignore.

Top Distributor Sectors

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2011 Market Mover: Werner Electric Builds Employee Loyalty

In 2011, MDM is recognizing distributors that are innovative in their approach to their markets. These Market Movers will be featured in this space. Werner Electric Supply is the first distributor featured.

Employees at Werner Electric Supply are eating better and moving more thanks to its health and wellness program. And healthy employees means happy employees, like Kim Berger, a regional administrative assistant for Werner in Minnesota.

“It’s very helpful to have the support system at work,” said …