The importance of e-commerce in distribution today can't be denied. And for industry leaders who want to stay industry leaders, it can't be delayed any longer, either. When Airgas, No. 5 on MDM's list of top industrial distributors, compared its e-commerce position to other companies in the industrial distribution space, it realized just how behind it was.
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Less than 5 percent of current transactions for Airgas happen online; compare that to other large industrial hardgoods distributors who report online transaction rates of 25 percent to 35 percent, according to Airgas in a recent presentation. In addition, the company realized "our large customers who engage with us through our e-business platform are our most penetrated customers," President and CEO Mike Molinini said recently at the distributor’s 2012 analyst meeting, available at Airgas.com.
"It used to be the most sophisticated (customers); now it's pretty much everybody," he says.
Airgas launched its initiative to overhaul its current e-business platform at the beginning of 2012, with a roll-out of the new platform scheduled for the first quarter of calendar year 2014.
It's a massive undertaking for the distributor. There's been virtually no user experience change on Airgas.com since 2007, Molinini says. "And you know in your life that your user experience between 2007 and 2012 has changed a lot." On top of that, the underlying technology supporting Airgas' e-commerce platform has not changed since 2002.
That means that another 14 months may be too long to wait in the current e-commerce environment. As such, the company is also renovating its existing platform to create a bridge between yesterday's technology and today's.
E-commerce is a key transaction enabler for all of Airgas’ customers, Molinini says. It has strong potential to improve the company's bottom line through increased sales and increased operating efficiencies.
Though no one can predict what tomorrow's technology will bring, Molinini says, "this is now critically important to attempt to be on par with the best of the best in the industry."