The Distributor Channel

When distributors get together, the most popular question in existence is, “How’s business?” Once unleashed, the conversation gods spin tales of glory, stories of woe and everything in between. It’s interesting talk, a fun icebreaker but it rarely provides any valuable information. I would like to commend Heating, Air Conditioning, Refrigeration Distributors International (HARDI – hardinet.org) for finally putting their information where their idle chat used to be. HARDI publishes a quarterly report on exactly how their members are finding business conditions. While things are not hunky-dory in the housing dependent HVACR world, their members have solid information to steer them through these tough times. Check out the HARDI Trends here .

Fastenal, a leading industrial distributor, continued to post strong growth in their business. Like most companies they have seen a slowdown in the last three months of the year (same store growth), but it would be our guess that while this year will be hard on Fastenal, perhaps it will be even harder on the folks who must compete in this line of trade. Here’s the reason why. Fastenal has mastered the art of bin restocking. They have essentially put together a reliable and efficient system for their customers to outsource a bit of the inventory handling and maintenance. Other distributors should make note and build their own system if they want to compete. Reported from MDM Staff   Fastenal Company, Winona, MN, reported sales for the year end Dec. 31, 2008, were $2.34 billion, an increase of 13.5% from the prior year. Profit was up to $279.7 million, an increase of 20.2%. In 2008, Fastenal opened 161 new stores, an increase of 7.5%. Although the distributor had overall growth,

In a recent article by Jack Keough, Industrial Distribution Magazine reported the results of a reader survey which indicates most industrial distributors are battening down the hatches for a long recession. They are cutting travel, clearing inventory and instituting hiring freezes. In a recession, preserving cash is important, but distributors can also put the recession to good use. Now is the time to drive change in your organization. When it comes to implementing new processes , such as Account Targeting, Planning or CRM reporting, Distributor Sales Managers always find their “old-hand journeyman sellers” to be the most resistant. The new guys are compliant, but the very people who could have the largest impact drag their feet and think of a million reasons to not follow procedures. Often, because of their relationships and skill sets they still manage to perform, but this does not take away from the significance of their inflexibility. These kinds of headlines cause even