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We analyze the qualitative results of our 1Q24 Baird-MDM Distribution Survey question that asked distributors about current or expected impacts from geopolitical issues.

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Market Insight Reports

The report features in-depth articles that recap the year that was 2023 in distribution dealmaking, a full rundown of every deal we covered in October-December, the latest EBITDA trading multiples and more.
Find a wealth of data and analysis extracted from the 3Q23 Baird-MDM Industrial Distribution Survey, including trending charts and figures for revenue and expectations, plus plenty of interesting commentary.
Find a wealth of data and analysis extracted from the 3Q23 Baird-MDM Industrial Distribution Survey, including trending charts and figures for revenue and expectations, plus plenty of interesting commentary.
Our 2023 third quarter M&A report features in-depth articles on activity by Ferguson and Veritiv, and chronicles the overall quarterly pace of new deals.
See MDM’s analysis of 2Q23 M&A activity pertaining to wholesale distributors, plus M&A financial benchmarks and recent Premium articles that had an M&A focus.
Its common practice at accounting firm Baker Tilly Virchow Krause, LLP, to assist privately held distributors and other corporate clients with what the firm calls walkaway cashflow modeling, where they evaluate how the client would fare in a hypothetical sale situation. Modeling different scenarios allows the executive team to plan for the future and improve forward-looking strategic decision making.

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This report is researched and produced by MDM editors. View the First Quarter report here.

These product groups provide a snapshot of inflation trends based on the Producer Price Index from the U.S. Bureau of Labor Statistics. Second quarter 2019 pricing levels are compared with first quarter 2019 and second quarter 2018. 

To view this report, log-in and click on the download link below the product listing to access the print-ready PDF.

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Industrial

  • Abrasives
  • Adhesives & Sealants
  • Metal Cutting Machine Tools
  • Metal Forming Machine Tools
  • Pumps, Compressors, & Eqmt
  • Ind. Material Handling Eqmt
  • Rubber & Plastic Hose
  • Rubber & Plastic Belts & Belting
  • Ind. Rubber Products, nec
  • Metal Valves (not fluid power)
  • Personal Safety Equipment & Clothing
  • Steel Mill Products

Construction

  • Softwood Lumber
  • Hardwood Lumber
  • General Millwork
  • Gypsum Products
  • Hardboard, Particlebd, Fiberbd
  • Plywood
  • Plastic Construction Products
  • Wood Ties, Siding, Shingles,
  • Shakes

Electrical

  • Electrical Machinery & Eqmt
  • Electronic Components & Accs
  • Integrating and Measuring Instruments
  • Motors & Generators
  • Wiring Devices
  • Transformers & Power Regulators
  • Switchgear, Switchboard, etc., Eqmt
  • Communications & Related Eqmt
  • Electric Lamp Bulbs & Parts

Other Related Electrical

  • Lighting Fixtures
  • Nonferrous Wire & Cable
  • Fabricated Ferrous Wire & Cable

Power Transmission/Bearing

  • Mechanical Power Transmission Eqmt
  • Ball & Roller Bearings
  • Plain Bearings & Bushings
  • Speed Changers, Drives & Gears

Fluid Power

  • Fluid Power Eqmt
  • Fluid Power Valves
  • Fluid Power Hose/ Tube Fittings
  • Fluid Power Pumps & Parts
  • Fluid Power Actuators/ Accum/ Cylinders

Plastics

  • Plastic Resins & Materials
  • Plastic Products (Overall)

Fasteners

  • Nuts, Bolts, Screws, Rivets, Washers (overall)
  • Aircraft Fasteners
  • Externally Threaded Fasteners
  • Internally Threaded Fasteners
  • Nonthreaded Metal Fasteners

Hardware

  • Hardware (overall)
  • Builders’ Hardware

Tools

  • Hand & Edge Tools
  • Power-Driven Hand Tools
  • Tools, Dies, Jigs, Molds, Fixtures
  • Cutting Tools & Accs (overall)
  • Precision Measuring Tools
  • Small Cutting Tools

Gases/Welding

  • Industrial Gases
  • Welding Machinery/ Equipment

Paper

  • Pulp, Paper & Allied Products (overall)
  • Sanitary Paper Products
  • Boxes
  • Packaging Products from Plastic

HVACR/Plumbing

  • Air Cond. & Refrigeration Eqmt
  • Heating Eqmt
  • Plumbing Fixtures & Fittings

To view this report, log-in and click on Download pdf below the product listing.

In this two-page report, available to download in PDF after log-in, we feature data on merger and acquisition trends and financial metrics for the largest publicly traded distributors across diverse sectors in the second quarter of 2019.

In partnership with Houlihan Lokey, an investment banking firm, the report includes data on M&A activity trends across all industries (not just distribution), as well as valuation multiples for deals in all industries.

June-Inflation-Index-Image

Modern Distribution Management's monthly Industrial Inflation Index measures a cross-section of industrial supplies.

This index includes:

  • Abrasives Products
  • Cutting Tools
  • Power Transmission Equipment
  • Fasteners
  • Valves, etc.
  • Power Tools
  • Material Handling Equipment
  • Belting
  • Hand Tools
  • Misc. Metal

Subscribers should log-in below to read this article.

Not a subscriber? Subscribe below or learn more.

lindsay-articleonly

IndustryWeek today offers an endorsement of a distributor's value; the online magazine looks at what it means for a distributor to offer true value, and also offers "nontraditional performance measurements," as provided by SKF's Bill Moore, to judge whether a distributor is effective as a strategic partner.

Moore tells IndustryWeek that engineering assistance supplied by a distributor is one example of a value-add - it can address recurring equipment failure problems, and improve overall performance.

One metric Moore offers in the article - how prepared a distributor is to react in emergencies - anything from an equipment failure to a ...

Hagemeyer North America has launched its 2009-2010 Green Book:Sustainable Solutions. The catalog contains 220 pages with 1,500 products and solutions from more than 60 Hagemeyer supplier partners. This is the second year Hagemeyer has offered a catalog dedicated to sustainable products.

"We take economic, social, ethical and environmental issues very seriously," says Brad Pulver, Hagemeyer North America senior vice president, Product Strategy & Marketing. "We believe it's our responsibility not only to combine common sense with keen business sense for a sustainable approach to business, but to serve as a solutions-provider for our customers who are eager to do the same."

Hagemeyer's Green Book is divided into six sections: Energy Management, Test & Measure, Building Products, Water ...

Online marketing offers a natural extension of a wholesale distributor's business model. And the real beauty of the medium lies in the ability to track response and focus efforts to yield the best results. This article looks at the importance of leveraging the interactive power of the Internet to win and strengthen customer relationships.
This article is excerpted from Outlook 2009: An Executive's Companion to Facing the Forces of Change - Lead the Way in the Supply Chain, published by the National Association of Wholesaler-Distributors.

As the National Association of Wholesaler-Distributors' Facing the Forces of Change® study pointed out, customers are using the Internet to bypass some of the information, education, and sales functions distributors have ...

As publisher of a 40-year-old subscription newsletter reporting on the wholesale distribution industry, I've seen a rapid shift in how our audience of wholesale distribution executives increasingly accesses our online offerings - on the Web, mobile devices and email.

Here are some of the lessons I've learned as we've built out our online information service in the past five years.

Lesson 1: Web site = Marketing Hub

Web sites have tended to grow haphazardly to serve many masters within a company. Marketing has to drive its development and architecture, and integrate transactional functions under the primary objectives of lead generation and customer service.

Combine the current successful marketing mix with e-mail and search engine marketing (SEM) to funnel customers ...

lindsay-articleonly

Recently, the Wall Street Journal ran a best practices article with lessons distributors can apply to their own services businesses: "Beyond Products: More manufacturers are branching out into the service business. Here's how to make the move successfully."

One of the key points made in the article: Many manufacturers who have moved into services have gone without a clear strategy. I'm sure some distributors will relate to the challenges outlined, including trying to sell services that were previously free (See Emerging Model: Fee-for-Service on how Cardinal Health and other drug distributors try ...

lindsay-articleonly

From around the Web today …

A commentary on the relationship between distributors and manufacturers by PVF industry veteran Robert Vick in The Wholesaler: It's an honest rundown of perceptions on both sides of the fence looking at things like the cost of manufacturers' going direct, the substitution of branded with non-branded product, wholesalers' knowledge of their costs, openness to technology, and so on. He says:

"Survival for both the manufacturers and wholesalers depends on the changes we are willing to make for each other before we can make the changes we need to have a better understanding of the role each of us play in the supply chain and which direction we must take to make ...

AmazonBusiness

Amazon Business has replaced AmazonSupply as the Internet retailers B2B website, which hopes to bring businesses a B2C shopping experience to B2B.

This article includes:

  • Why Amazon Business is less threatening to distributors
  • What to expect from Amazon's new B2B marketplace
  • Amazon's goals for Amazon Business

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Not a subscriber? Subscribe below or learn more. Subscribers also have access to the following related articles:

  • Digital Common Sense Versus Amazon
  • Grainger Tackles the Data Challenge
  • 2015 State of E-Commerce in Distribution: E-Commerce on Path to Maturity

Technology continues to introduce new disruptions to the supply chain. Jim Barnes, ISM Services managing director, recently spoke with MDM about the potential these disruptive technologies have for fundamentally changing how the supply chain operates.

This article includes:

  • The current stage of technology adoption
  • How the Internet of Things is being adapted
  • The effect of automation

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  • MDM Interview: Creating a Culture of Innovation
  • Strategic Options for Shipping Efficiency
  • Overcoming the Barriers to Analytics

Distributors must start viewing IT as strategic rather than just tactical.

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  • E-Commerce on Path to Maturity
  • Grainger Tackles the Data Challenge
  • Digital Common Sense Versus Amazon

In this two-page report, available to download in PDF after log-in, we feature data on merger and acquisition trends and financial metrics for the largest publicly traded distributors across diverse sectors in the first quarter of 2015.

In partnership with Houlihan Lokey, an investment banking firm, the report includes data on M&A activity trends across all industries (not just distribution), as well as valuation multiples for deals in all industries.

shopkey-small

The fourth annual MDM distribution e-commerce survey conducted with Real Results Marketing revealed several key trends:

  • The percentage of companies with at least 10 percent of their total revenue from e-commerce grew 14 percent in 2014 from 2013.
  • Barriers to entry for deploying an e-commerce site have dropped significantly, allowing many more mid-market and small distributors to sell online.
  • The primary objectives among distributors for e-commerce remain acquiring new customers, enhancing their company brands and improving the user experience.
  • Distributor satisfaction with mobile enablement on their e-commerce site and mobile applications increased in 2014 from 2013, while satisfaction with mobile optimized websites remained the same.

This article examines the results of the 2015 State of E-Commerce in Distribution Survey and how the industry’s e-commerce offerings are maturing. Part 2 will look at best practices for distributor-integrated marketing approaches to support electronic shopping and buying. 

This article includes:

  • E-commerce top priorities
  • Satisfaction with e-commerce platforms
  • Implications for the future of e-commerce

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  • Overcoming the Barriers to Analytics
  • Grainger Tackles the Data Challenge
  • Historical E-Commerce Trends in Distribution
analytics_abstract

Analytics tools are playing an increasingly important role in distribution. But many distributors recognize that they lack the capabilities to implement an effective analytic strategy in their businesses.

This article includes:

  • Dealing with ERP system problems
  • Hiring people with the right analytics skills
  • Considering software-as-a-service providers

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  • Grainger Tackles the Data Challenge
  • Use & Abuse of Customer Profitability Analytics
  • MDM Interview: Creating a Culture of Innovation
succession-ME

Mayer Electric, Birmingham, AL, has been a family business since its founding in 1930. CEO Nancy Collat Goedecke spoke with MDM about the processes the family developed and the challenges they have overcome to keep the company healthy and thriving.This article is part of a series on succession planning in distribution.

This article includes:

  • Important decisions involved in succession planning
  • Challenges a family business faces
  • Preparing the next generation

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  • MDM Interview: Creating a Culture of Innovation
  • Succession Planning: Executing the Strategy
  • Manufacturing’s Millennial Dilemma
TargetMarket

Improved market access can drive long-term growth in both a distributors profitability and its market share. But it requires an analytical look at customers and opportunities. This article is the final installment in our series on customer profitability analytics.

This article includes:

  • Customer segmentation
  • Growth and profit opportunities
  • Aligning services with customer needs

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  • Grainger Tackles the Data Challenge
  • Tackling the Profitability Yo-Yo
  • 3 Margin Levers of Customer Profitability Analytics
succession_recreading

Even if a company has a vision, strategy and talent for its succession plan, challenges remain for ensuring it will prosper beyond its current leadership. Distributors share their best practices for succession, from identifying talent to forming new C-suite positions to creating employee stock ownership plans.

This article includes:

  • Assessing candidates for C-suite positions
  • Creating positions focused on succession planning
  • Other succession planning options

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  • Manufacturing’s Millennial Dilemma
  • Succession Planning: Positioning for the Future
  • Training, Technology Take Front Seat in Employee Retention Strategies

Customer profitability analytics are an effective way to drive improvements in gross and net margins. This article looks at how distributors can apply the information they have uncovered to improving profitability. Part 1 of this series covered the basic concepts behind customer and transactional cost analysis and presented some key limitations.

This article includes:

  • Profit Improvement Plans
  • Pricing Optimization
  • Services and Channel Alignment

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  • Use & Abuse of Customer Profitability Analytics
  • Tackling the Profitability Yo-Yo
  • Commentary: Analyzing Analytics
Grainger logo on a screen

E-commerce remains a priority for Grainger, as sales through online channels continue to grow. Paul Miller, vice president of global e-commerce, customer information and innovation for Grainger, spoke with Editor Jenel Stelton-Holtmeier at the 2015 Grainger Show, a trade show for Graingers employees, customers and suppliers. Miller discussed how the $10 billion distributor is addressing data challenges that come from having such a broad portfolio and how it is trying to streamline the process for customers.

This article includes:

  • E-commerce challenges
  • Improving search functions
  • Usability across platforms

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  • Use & Abuse of Customer Profitability Analytics
  • Overcoming a Technology Deficit
  • Forecast: Continued Growth in 2015
mdm_premium_extra_RR

To thank you for your business and add value to your MDM Premium subscription, MDM offers bonus content each month exclusively to premium subscribers.

This month we feature a bonus article on United Stationers' decision to reposition to a new brand, Essendant. Associate Editor Eric Smith recently attended Emerge Core Live, the company's trade show and conference for customers and suppliers in Nashville, TN. During the show, CEO Cody Phipps conducted a media roundtable to outline the strategy behind United Stationers' efforts as it adapts to an evolving industry.

This content is exclusively available as bonus content to MDM subscribers. Log-in below to download the PDF of this month's report.

Not a subscriber? Subscribe now starting at $195.

Modern Distribution Management's monthly Industrial Inflation Index measures a cross-section of industrial supplies.

This index includes:

  • Abrasives Products
  • Cutting Tools
  • Power Transmission Equipment
  • Fasteners
  • Valves, etc.
  • Power Tools
  • Material Handling Equipment
  • Belting
  • Hand Tools
  • Misc. Metal

Subscribers should log-in below to read this article.

Not a subscriber? Subscribe below or learn more. Subscribers also have access to the following related articles:

  • MDM Pricing Trends Report: Second Quarter 2016
  • 2016 State of E-Commerce: E-Commerce Journey Continues
  • Market Snapshot: Industrial Hose Market Demand in the United States

The talent gap in distribution is widening as companies struggle to recruit and retain younger employees, but a better training process can help reverse that trend. This article examines why and how companies should remodel their training methods in todays changing marketplace.

This article includes:

  • An overview of what millennials want
  • Why to train even if they leave
  • How to look at training in a new way

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Not a subscriber? Subscribe below or learn more. Subscribers also have access to the following related articles:

  • 2016 Distribution Remodel: Deepen Talent Development
  • Mind the Training Gap for Negotiation
  • 5 Tips to Reduce the Cost of Employment

The distribution landscape has changed, but small businesses, particularly distributors, are still avoiding investment in new technology to adapt. This article examines the hurdles to investing in technology and how to strategically overcome them.

This article includes:

  • How tech investment leads to profitability
  • Mental hurdles of tech adoption
  • First steps to getting started with new technology

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  • Increase ROI from Existing Technology
  • Bring IT Out of the Shadows
  • Listen to Customers or Lose Them

Small manufacturers continue to be focused on using technology for tactical purposes rather than strategic, according to the Small Business Barometer 2016, a new report released by Exact and Pb7 Research.

This article includes:

  • Top challenges for small manufacturers
  • How technology can improve operational efficiencies
  • How changes to supply chain should change tech usage

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  • New Tech Disrupts Supply Chain
  • Bring IT Out of the Shadows
  • IoT Poised to Alter Supply Chain

This article is an overview of the benefits of broadening employee development by teaching multiple facets of the company.

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  • 2016 Distribution Remodel: Deepen Talent Development
  • Mind the Training Gap for Negotiation
  • 5 Tips to Reduce the Cost of Employment
MarketSnapshot-IndustrialHose

The MDM Market Snapshot, based on data from MDM Analytics, includes market demand for Industrial Hose by end user in the U.S., plus the top end users by 6-digit NAICS.

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  • MDM Interview: Skys the Limit at SRS Distribution
  • Market Snapshot: Abrasives Market Demand in the United States
  • MDM Pricing Trends Report: Second Quarter 2016

Rebates play a critical role for the profitability of many distributors. But as the market changes, some manufacturers are rethinking how they incentivize their distributors. This article examines how rebates have shifted and how distributors may need to change their models to adapt.

This article includes:

  • How rebates have been used in the past
  • The future of rebates
  • How to be proactive about these changes

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  • Listen to Customers or Lose Them
  • A Growing Competitive Threat
  • The Evolving Role of Master Distributors

Not enough distributors adequately prioritize their information technology departments, but doing so can give them a competitive advantage. This article shows how moving IT from the server room to the boardroom will help improve efficiencies, cut costs and grow the bottom line.

This article includes:

  • How to elevate IT's presence within a company
  • Benefits of elevating the role of IT
  • Consequences of not valuing IT

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  • Increase ROI from Existing Technology
  • IoT Poised to Alter Supply Chain
  • Internet Redefines Competitive Landscape

Distributors and manufacturers trying to address new challenges with the same set of tools that once worked are at risk of eroding profitability and weaker customer relationships.

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  • Chasing Profitability
  • 2016 Distribution Remodel: Refocus on the Core
  • Work ON Your Business, Not Just IN Your Business

Modern Distribution Management's monthly Industrial Inflation Index measures a cross-section of industrial supplies.

This index includes:

  • Abrasives Products
  • Cutting Tools
  • Power Transmission Equipment
  • Fasteners
  • Valves, etc.
  • Power Tools
  • Material Handling Equipment
  • Belting
  • Hand Tools
  • Misc. Metal

Subscribers should log-in below to read this article.

Not a subscriber? Subscribe below or learn more. Subscribers also have access to the following related articles:

  • MDM Pricing Trends Report: Second Quarter 2016
  • 2016 State of E-Commerce: E-Commerce Journey Continues
  • Market Snapshot: Abrasives Market Demand in the United States

Not enough distributors listen to their customers, and this is a problem in the era of the customer. With the rise of Amazon and other unknown disruptors possibly on the horizon, B2B companies must map their customers experience to uncover deficiencies and then work to solve them.

This article includes:

  • The new model of distribution
  • How to talk to your customers
  • Consequences of inaction

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  • Are You Really Customer-Centric?
  • Customer Engagement: Dont Be Amazon
  • 2015 State of Distributor Marketing: Effective Strategy Solves Challenges

Internet of things is a broad term for a network of connected devices that can automatically communicate with one another. The applications of this new technology are still in the early stages for distribution, but experts expect rapid growth in the next few years. This article examines some of the opportunities and challenges IoT introduces for the supply chain.

This article includes:

  • Connecting the supply chain
  • IoT opportunities for distributors & manufacturers
  • Concerns about IoT

Subscribers should log in below to read this article.

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  • New Tech Disrupts Supply Chain
  • Integrated Supplys Next Phase
  • Supply Chain Sustainability Efforts Grow

Legacy and name recognition arent enough to take home the gold, only distributors that put the necessary work into their business will succeed.

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  • A Growing Competitive Threat
  • 2016 Distribution Remodel: Refocus on the Core
  • Work ON Your Business, Not Just IN Your Business

The MDM Industry Innovator award recognizes an individual who is leading change in a changing industry, rather than letting the change lead them. This years winner is Jay Amstutz, president of Ohio Power Tool, Columbus, OH. Amstutz was selected for his approach of using online tools to help his local distribution company compete with larger players for sales and employees.

Subscribers should log in below to read this article.

Not a subscriber? Subscribe below or learn more. The full 2016 Distribution Trends Special Issue is available to download in PDF format to MDM Premium subscribers.

MA_abrasives

The MDM Market Snapshot, based on data from MDM Analytics, includes market demand for Abrasives by end user in the U.S., plus the top end users by 6-digit NAICS.

Subscribers should log in below to read this article.

Not a subscriber? Subscribe below or learn more. Subscribers also have access to the following related articles:

  • MDM Interview: Skys the Limit at SRS Distribution
  • Market Snapshot: Tool Storage Market Demand in the United States
  • MDM Pricing Trends Report: Second Quarter 2016
Quarterly-MDMBaird

Robert W. Baird & Co., in partnership with Modern Distribution Management, conducted a survey of more than 600 distributors and manufacturers to gauge business trends and the outlook for the distribution industry in diverse sectors. Here is a summary of second-quarter results and distributor and manufacturer expectations for the remainder of 2016.

This article includes:

  • Revenue, inventory and pricing expectations
  • Sector breakdown
  • Analysis of trends affecting sales and operating performance

Subscribers should log-in below to read this article.

Not a subscriber? Subscribe below or learn more. Subscribers also have access to the following related articles:

  • 2016 State of E-Commerce: E-Commerce Races to Maturity
  • 1Q2016 Financial Metrics & Trading Multiples
  • 2016 Distribution Remodel: Refocus on the Core

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Work with a banking partner that knows your business. Get detailed information on investment banks with expertise in the wholesale distribution industry.

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