Failure to recognize changes in the business landscape can result in systemic failure. Since approximately March 15th, the business climate has changed dramatically. While the length and permanence of the changes can be argued, for now, and likely through the end of 2020, the shift in the business climate is real and exceedingly different from just a couple months ago. It is time for manufacturers and their distribution partners to look at the operating environment and have some frank discussions about the future. Some distributor contracts have been in place for years. Many of them are built around the concepts which are, at least for now, obsolete. Let’s review some of these ideas. Good distributors: Maintain an inventory. Develop year over year growth. Identify new customers in their territory. Assume technical service and post-sale shortfalls tied to the manufacturer. Conduct customer events to promote new products. Participate in and perhaps taking the lead in ...

With the Memorial Day weekend upon us and summer about to officially begin, I have been hit with at least a dozen emails, LinkedIn.com connects and calls from both distributors and students on the topic of Co-op programs in Distribution.   Co-op and Intern projects are good for distribution Back in our father’s day, companies made room for the kids of employees, family and friends in their business.  It was almost like a job benefit, work here and we’ll find a place for your son or daughter during the summer.  There were lots of “make work” projects.  Painting and scrapping, sweeping and shoveling, stacking and unstacking were all on the menu.  Readers who grew up in wholesaling families can probably relate to some of this.  The point is, there were a lot of jobs that nobody wanted and kids often got stuck with them.  It may still be happening… Today, business is different.  Our building is more professional (with fewer dark obscure r...

Over the years I have heard some pretty amazing things said about distributor inventories.   Let me share a few of these: A peddler can’t sell from an empty wagon and a distributor can’t sell without a full warehouse. It’s the distributor’s job to provide local inventory. If the distributor doesn’t stock your product and lots of it, you’ll never get its full commitment. We want distributors to prove their commitment to our company by placing a large stock order up front. The distributor’s stock provides a margin of error for logistics problems at its suppliers. While all of these probably made sense back in the day, those days are finito, over, dead and gone.  Or at least they are for the knowledge-based distributor.  Astonishingly, I still hear most of these words of wisdom bantered about; mostly by the sales teams of distributor supply partners.  What’s really bizarre is most of these folks never took the time to think seriously about their commen...