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Top 3 Predictions for the Distribution Industry in 2014

A lot of people I've talked to recently are not sorry to see 2013 go. In many ways it was a transition year; we finally started feeling like we were moving forward after the Great Recession – even if the numbers tell us we started doing that four years ago. But at the same time, distributors and manufacturers say they've been stifled by a government that appears to be doing its best to stop the forward movement from gaining momentum.

It was a year of finally looking forward – reluctantly in some cases – to growth-inspired initiatives rather than efficiency-driven initiatives, maybe because we finally reached the end of the rope on the latter. Distribution is definitely a leaner industry than it was just a couple years ago, and everyone has learned how to do more with less.

In that forward-looking spirit, here are some predictions on what 2014 will offer distributors:

1. Development of potentially disruptive technologies will continue to catch the eye of innovative companies. When the "news" about Amazon exploring drone delivery broke, the Internet lit up with reactions – some good, some bad and a lot of in-between. Could unmanned deliveries really work?

While it may be many more years before drones have a major impact on delivery in the distribution world, several other potentially disruptive technologies are already leaving their mark. 3D printing is being used in prototyping of new products and has the potential to be used by distributors to create replacement components for products they sell. Robots and automated pickers are already playing a role in warehouses around the globe.

And there are no signs that development of these disruptive technologies will slow. We may not know what's coming next, but we know that something new will come – and we'll all have to evaluate what that means for our industry.

2. Data management will become a more practical endeavor. Better data management on all fronts will continue to be critical in 2014. Several respondents to MDM's annual reader survey, sponsored by NetSuite, said they were prioritizing clean data and analytics to make their sales and marketing efforts more effective. They are also standardizing the data they have to make sure they have the data they need.

“Organizing and managing data is key to ROI and you can no longer afford to look at things at a macro level,” one respondent wrote. Another wrote that he wants to be able to “stay current” and give associates the “ability to see data” so they can act in an “agile manner.”

3. Demand for multichannel capabilities will continue to grow. Business-to-business customers are increasingly looking to replicate the online shopping experience they have as consumers. More distributors of all sizes are introducing e-commerce platforms, but now customers want to be able to access everything seamlessly from their computers, tablets and mobile phones.

Customers want to do business with the companies that make it easy to do business with them, and that means taking steps to meet this demand for a multichannel experience.

Read more about the critical issues that matter to distributors in Top 10 Distribution Trends to Watch in 2014.

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