The 2020 Mid-Year Economic Update_long

Tip: Know What Your Customers are Actually Buying

What customers are buying is in many cases not what distributors think they are selling.

Big-box retailers such as Lowe’s and The Home Depot have found their niche in the B-to-B world. But, a different view of customer demand can give distributors a valuable perspective on what and how to sell, according to Affiliated Distributors’ Tom Blue in Distributors Respond to the Big-Box Challenge.

“So much of the manufacturing world today is about documented cost savings and productivity improvements. That’s where the independent distributor is able to win out, because they understand that and have the expertise to address it,” Blue says.

To compete, distributors have to realize that what customers are buying is in many cases not what distributors think they are selling. Some customers are buying a reliable source of supply. Some are buying the ability to bundle. Others are buying convenience, capital services, pre-sale advice or post-sale support.

As markets fragment, distributors need to start segmenting customers not by how much they buy, but by which services they’re buying.

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