The 2020 Mid-Year Economic Update_long

Making the Case for Industrial Distribution

MDM spent the past couple of days at the annual Power Transmission Distributors Association Industry Summit. The summit drew more than 800 participants.
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A few takeaways on the association level:

The PTDA is a leader in the Industrial Careers Pathway initiative, focused primarily on the recruitment of students into industrial distribution programs (and then into industrial distribution careers). As the initiative's executive director says: "We're good at talking to each other about problems in recruiting in our industry, but we're not so good at making a case for our industry to those not in 'our world.'" The initiative has dozens of ...

MDM spent the past couple of days at the annual Power Transmission Distributors Association Industry Summit. The summit drew more than 800 participants.
&nbsp ;
A few takeaways on the association level:

The PTDA is a leader in the Industrial Careers Pathway initiative, focused primarily on the recruitment of students into industrial distribution programs (and then into industrial distribution careers). As the initiative’s executive director says: “We’re good at talking to each other about problems in recruiting in our industry, but we’re not so good at making a case for our industry to those not in ‘our world.'” The initiative has dozens of associations that have joined the effort as ICP Alliance Partners. ICP points out: Industrial distribution employs about 1% of the total work force in the U.S. and 2% in Canada, it represents 5% of U.S. GDP. The industry is challenged by global competition, the fact that a significant percentage of the work force will retire over the next decade, that there is a lack of awareness of the industry and a broad misperception about industrial careers. And, of course, as a result, employers have a hard time finding qualified employees.

PTDA identified critical issues facing its members. I’m sure many distributors can relate, regardless of industry:&nbsp ;

  • Because customers can and will source from anywhere in the world, the sources of supply and purchasing are now global. Power is and will continue to shift toward the customer.
  • As stated above, the employment environment continues to make it tough to attract and retain talented employees. Not only will there be fewer people to recruit, competition for the best employees means it will cost more to secure their services.
  • Distributors and manufacturers must invest in e-commerce to facilitate the sharing of information both downstream and upstream as “value-added” pressure pushes customers to question their relationships with distributors due to the ready availability of information via the Internet.
  • And, changes in the structure of distribution will force the growth of demand-driven channels, requiring distributors to share point-of-sale and product movement information with suppliers. Use of private-label strategies will also increase.

NAHAD is the latest association to endorse PTDA’s PPIF, a standardized, ASCII format for electronic transmission of manufacturer price and product updates. NAHAD joins five other outside associations that have endorsed the format.

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