Canadian Electrical Wholesaler

Jan 11, 2019

David GordonBy David Gordon

As we turn the page into 2019, welcome to new opportunities, new challenges, new initiatives and perhaps some new ways of doing business or serving your customers to ensure a record 2019… whatever your goals may be.

While we thought about making predictions, we decided to leave those to others and share some channel dynamics that we’ve been observing that we feel are significantly impacting the electrical distribution channel.

These include:

1. Whose brand is valuable?

In an age of eCommerce, price comparisons, channel convergence and fragmentation, as well as sourcing and more, whose brand is important to customers, and why? Does the manufacturer brand matter to the end-user? To the contractor? To the electrician in the field? To the distributor principal? To their salespeople? Or does the distributor brand matter to a contractor? To their staff? To maintenance staff or engineers? Understanding and “living” your value proposition as well as adequately funding the communication of it will be critical to revenue goal achievement moving forward… and if you don’t, prepare to compete on price and defer margin growth.

2. Size matters

Size influences strategy. It impacts the ability to negotiate (leverage). It determines the flexibility to spend on people, technology, training, infrastructure, and more. But it doesn’t mean that “small(er)” can’t compete. Fitting your strategy and execution abilities into your resources can require creativity. Much depends on “what do you want to be?”

3. Manufacturers support channels, but you?

Manufacturers are supporting more sales and distribution channels than ever before in the pursuit of sales growth. They consider where is the customer buying and then have a fiduciary responsibility to consider being available to wherever the end-customer decides to purchase. At the same time, more distributors (in other channels) seek to identify how to increase their share of spend of their customers, hence they diversify their product offerings (especially those serving industrial and MRO environments). And they support many electrical distributors in your marketplace (in most cases). So the question becomes, why should they support you? What is your value proposition to them that justifies why they/their sales force should support you disproportionately? Or perhaps you don’t really need additional or incremental support from them other than access to material at a competitive price? Manufacturers will chase revenue; distributors should consider their needs beyond material.

4. Products or customer? What do you sell? What is your focus?

Many companies in the pursuit of “sell something” become product focused and consider that every account has opportunities. And, quite honestly, there are companies who produce or source products with the sole strategy being “sell to earn share (sales) at distribution.” These companies are affectionately called commodities… their products are interchangeable with competitors; they compete on price, ease of doing business or relationships; and are challenged with thinking of, or spending money on, marketing and creating demand. A few live on their brand legacy. And then there are companies that consider who their customer is and seek to develop products and offerings and then create a reason for customers to want to prefer, or purchase, their products. Some are successful, many are “talk.” Distributors also have the same challenge and differentiators become their ability or willingness to market (to differentiate themselves as well as their suppliers or offerings), the various services they offer (value-added, fee-based and expected) and the quality of their sales resources. Both parties should evaluate themselves as well as their customers and suppliers… and a healthy mix, by market, of product-focused and customer-focused suppliers and distributors is needed. The questions become, “What do you want to be (and then, are you willing to resource/manage it?)” and “What is your partner?”

5. Reaching/driving influencers

This is about demand generation. Who is responsible for creating preference for a product as well as for where the product is purchased. Manufacturer? Distributor? Marketing? Sales? And then the more challenging question of “How”? Consummating the order isn’t too difficult. The customer knows where the product can be procured and has their decision criteria. They can call, fax, email, visit a branch or order online. The key questions are what to order and why order from you. Manufacturers, are you investing to influence or leaving it to a distributor to sell? To accept an order (or “pull you from the shelf”)? Distributors, are you dependent on your sales organization to wait for “your” contractor to place the order with you? How you consider this can impact 2019 and beyond sales.

6. Digital divide from the top, through the channel

Much talk, growing investment in eCommerce as well as the broader eBusiness arena. In discussions with manufacturers we’re seeing more considering strategies (sometimes pilot initiatives) with distributors on targeted eBusiness / eCommerce initiatives. Creativity counts here, and manufacturers are testing models to determine how they can differentiate (partner?) with distributors. Adoption of “e” as an organizational mindset as well as a sales/marketing imperative may create more of a distribution divide than solely revenues. Ability to share ideas with senior manufacturing management can be key to gaining visibility… and then sharing results. The creative or open-minded can wind as manufacturers seek differentiation and revenue.

7. Defining service(s)

Distributors, and some manufacturers, offer many services. Unfortunately, they’ve done a poor job of cataloguing their services, and determining what is chargeable and what should be communicated. Every distributor can outperform Amazon, and for free, but customers take it for granted. Few charge for services due to sales conviction and defined pricing models. Some are changing this. Some have unrealistic goals of services being 10-25% of sales (feasible in rare cases). Distribution can compete with eCommerce players for many reasons, but defining your services leads to differentiation… for distributors and manufacturers (as, if manufacturers don’t determine “why them”, then share will continue to shift to lower priced manufacturers as most products are commodities).

8. Easy to do business with… more than omnichannel

There are many choices within the market… for anything. A key differentiator for customers is who is easier to do business with, especially if all else is equally or relatively equal. So, the question is, “How easy are you to do business with?” Ask your salespeople 1) how they view your company, and 2) how they think their customers view the company. And then ask your customers. Take away unnecessary barriers, become easier, and communicate the differences. Companies who achieve this gain customer preference, loyalty and advocacy.

9. Metric management

With growth tightening and gross margins eroding, metric management is becoming more important. As a friend once said, “People respect what is inspected.” Scorecards are nice but you need the right KPIs to drive each department and your company. Not too many so that they become watered down and your staff/salespeople become confused and therefore indifferent. Every department/role can be measured. Identify what are the keys to each area’s success to drive performance… and the performance of your trading partners. Metrics can drive sales and profits. Consider the steps to success, not solely the end goal.

10. Sales management drives culture

For distributors, sales (and hence salespeople) have been the thing. Many aspired to be in these roles as they are the marquee roles — the people who are respected, listened to or have the ability to break the rules. In essence, your sales organization and your sales management team, as well as the drive for sales, have defined the culture of most distributorships. While this can infer “customer focused”, the question becomes, “is the culture of yesteryear the culture you want to evolve to for tomorrow?” There may be elements to retain, perhaps many qualities should be timeliness, but people change, companies change and business models are unfolding that may make you consider a more inclusive approach. A culture to follow sales or a culture to generate sales?

And some marketing concepts that we believe will enable companies to accelerate growth:

    • Distributors who offer frequent buyer, loyalty, or customer retention programs and evolve these programs into value-based initiatives will outperform those who think that offering points solely for merchandise makes a difference.

    • Customer and contact segmentation and messaging will add value.

    • Integrative messaging adds value. Not everyone wants or reads everything on email. Breaking through the clutter is important.

    • CRM is gaining adoption as companies recognize that they need more contacts per account.

    • Sales is a team sport… but many salespeople haven’t realized this. As this cultural evolution occurs, compensation models will evolve (starting with new hires as well as new or enhanced sales models). eCommerce is only a minor element of this. Changing customer behaviours as well as generational issues, employment longevity, product training and more are redefining sales models.

    • Distributors need at least 3 levels of marketing interaction: key customers, growers who are underperforming assigned accounts and “overachieving” unassigned accounts, and branding and differentiation initiatives

    • Develop exception marketing reporting tools

    • Implementation of eCommerce / eMarketing initiatives that not only serve existing accounts and be of service to those who are “disconnected” from your company but companies with creative eCommerce staff can create alternative channels if their company is strong operationally.

Just some thoughts to stimulate discussion to get your year started. Perhaps for your management meetings; perhaps topics for your sales meetings.

What are you seeing as additional channel dynamics (beyond product-driven issues) that will impact your 2019?

David Gordon is President of Channel Marketing Group. Channel Marketing Group develops market share and growth strategies for manufacturers and distributors and develops market research. CMG’s specialty is the electrical industry. He also authors an electrical industry blog, He can be reached at 919-488-8635 or This email address is being protected from spambots. You need JavaScript enabled to view it..


OlsonBy Katrina Olson

A recent CEW article by David Gordon caught my eye. The headline was, Are Your Sales and Marketing Teams Inhibiting Growth?

As a marketing consultant, writer, and trainer, I recognized the challenges and barriers that David was writing about. We agree on many issues (and their causes) facing electrical distributors and marketers. But I also hear from marketing people all the time that the C-Suite is hindering their efforts which, in turn, hinders the company’s growth.  

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2018 Electrical North American MeetingOn October 29-31, 2018, the AD Electrical North American Meeting drew over 1,000 attendees. This event attracted 151 first time attendees and representatives from over 362 companies in the United States, Canada and Mexico.

Attendees benefited from a variety of agenda topics, including: Network Meetings, Emerging Leaders Session, and Country-specific Business Meetings. New to this year’s agenda was a SPA Optimization Workshop led by industry veteran Mo Barsema. In addition, members and suppliers also attended a panel discussion on managing and measuring your digital success.

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CEW 6 HR 400People with low levels of coping skills are at higher risk for mental health issues and mental illness than those with high levels. Gaps in coping skills inhibit the ability to solve problems and to make healthy and effective decisions.

To examine how coping skills can predict health outcomes, Dr. Bill Howatt facilitated a doctoral research study that examined the question: “What role does an individual’s coping skills have in predicting psychological and physical health outcomes?” The study found that coping skills mattered and were, in fact, a moderator that partially explains why some individuals had better physical and psychological health outcomes than others. The study concluded that when combining a person’s coping skills with their perceived stress levels, coping skills were significant in predicting which employees were at more or less risk for health issues.

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Changing Scene

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Desdowd Inc. has been chosen to serve as Thermon’s manufacturer's agent for the province of Quebec ...
Gerrie Electric Wholesale Limited’s website has a fresh new look but continues to offer the same ...
Following a record 2018, Westburne continues its investment in its British Columbia team with two ...
Cree, Inc. has signed an agreement to sell its Lighting Products business unit, which includes the ...
On March 1 Eaton announced intentions to spin off its lighting business, creating an independent, ...
John Wade’s tenure of over 25 years working in the electrical industry in various capacities were ...
At least 17 privately-owned companies in Canada’s electrical industry continue to earn Canada’s ...
From February 25 to 27, 2019, AD welcomed more than 280 AD independent distributors and service ...
Liteline Corporation has named Eric Teacher as Liteline's newest Regional Sales Manager — ...
  The Canadian Electrical industry is at the forefront of innovation. Our products help ...


 EFC Announces 2018 Marketing Awards Winners

2018 Marketing Awards WinnersElectro-Federation Canada (EFC)’s Marketing Awards program recognizes member organizations that demonstrate marketing excellence and innovation within the Canadian electrical manufacturing and distribution industry. Winners of this year’s awards were recognized at EFC’s 8th Annual Future Forum, held earlier this month. (Shown in photo: EFC President and CEO Carole McGlogan with representatives from Bartle & Gibson, winners of the Integrated Marketing Award — distributor under $50 million.)Electro-Federation Canada (EFC)’s Marketing Awards program recognizes member organizations that demonstrate marketing excellence...

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CEW 6 ShowReport 400Leaders and innovators from business, government and the education sector gathered for this ABB premier collaboration event. More than 11,000 delegates attended the bi-annual ABB Customer World Houston 2019 from March 4 to 7 in Houston, Texas. ABB’s latest pioneering technologies were displayed over 150,000 sq ft of a colourful, buzzy display of futuristic conveyor belts and robots, an ABB Formula E Generation 2 car, and much more groundbreaking technology. ACW attendees also took part in keynote sessions and seminars focused on realizing the tremendous productivity and performance improvements that digitalization delivers for companies of any size and from any industry.

In his keynote address at the event, ABB CEO Ulrich Spiesshofer explained how ABB was shaping its business for leadership in digital industries to support its customers in a time of unprecedented technological change and digitalization. He was joined by Hewlett Packard Enterprise CEO Antonio Neri. 

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Changing Scene: 

Cree logo 2 400Cree, Inc. has signed an agreement to sell its Lighting Products business unit, which includes the LED lighting fixtures, lamps and corporate lighting solutions business for commercial, industrial and consumer applications, to Ideal Industries, Inc. for approximately US$310 million before tax impacts, including up-front and contingent consideration and the assumption of certain liabilities. Cree expects to receive an initial cash payment of US$225 million, subject to purchase price adjustments, and has the potential to receive a targeted earn-out payment of approximately US$85 million based on an adjusted EBITDA metric for Cree Lighting over a 12-month period beginning two years after the transaction closes.

The agreement continues Cree’s strategy, announced in February 2018, to create a more focused, powerhouse semiconductor company, providing growth capital for Wolfspeed, its core Power and RF business, and equips Cree with additional resources to expand its semiconductor operations. The deal also enables Cree Lighting to gain additional global focus, channel support and investment as it becomes a growth engine for the IDEAL team.

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Peers & Profiles

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On a regular basis, our publications profile members of our industry through their responses to a ...
First and foremost, sitting down with Susan Uthayakumar feels more like sitting down and conversing ...
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Laura Dempsey has been working as an outside sales representative for E.B. Horsman & Son for ...
Michael Gentile, President and CEO of Philips Lighting Canada, has had a long and distinguished ...


 Young Leaders: Taylor Gerrie

Taylor GerrieOn a regular basis, our publications profile members of our industry through their responses to a Q&A. It’s a way of recognizing industry movers and shakers, and helping our readers get to know them better. 

Recently we launched an initiative with Electro-Federation Canada's Young Professionals Network to include profiles of up-and-coming leaders. We provided the list of questions below to Taylor Gerrie, Automation Account Specialist at Gerrie Electric Wholesale Ltd. in Burlington, Ontario. Here are Taylor’s responses.

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Susan Uthayakumar, President of Schneider Electric Canada: Driving Success

Susan UthayakumarBy Owen Hurst

First and foremost, sitting down with Susan Uthayakumar feels more like sitting down and conversing with a friend than conducting an interview with the Canadian president of one of the world’s largest electrical manufacturers. Of course, she exudes the confidence and knowledge her position demands, but equally identifiable are an open and engaging nature.

In a recent sit-down, we learned a little about Susan’s history and what drives her to succeed.

To begin, Susan was born in Sri Lanka and immigrated to Canada at a young age. She went to high school in Canada and attended the University of Waterloo where she earned undergraduate and graduate degrees.

Upon completing university Susan began her working career with Deloitte, which she describes as a great starting point as she was surrounded by highly driven and intelligent individuals. She welcomed being in a position that was demanding and helped nurture a strong work ethic. Her work with Deloitte also instilled a great interest in acquisitions, which would serve her well as her career unfolded.

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CEW 3 Perspective 400

We often learn how to look forward by first looking back, or at the very least we realize that despite our best efforts we have not truly advanced quite so much as we had thought. Sure, technology is rapidly advancing. That’s beyond question. But what about our approach to selling it? Have we changed that much in the last 20, 40, 60 years? Inevitably there have been advances and changes in marketing, the Internet causing the biggest shift, but many of the concerns and directives that have driven the distribution and marketing of industrial electrical products remain, or at least planted the roots of the concerns of manufacturers and distributors today. 

To gain perspective of the perceptions and directions of electrical product distribution in 1960, we turn to Edwin H. Lewis. In 1960 Lewis published “The Distribution of Industrial Electrical Products” in the Journal of Marketing.

To fully define electrical product distribution in 1960, Lewis broke his study into several categories. We will follow his direction and provide his insights on the industry in each of the categories he identified.

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Looking Back

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The best memory I keep from CEDA is the way that they accepted me when I came into the business. ...
In the 1930s to 1940s, CEDA’s Western Canada membership was very stable with old line independent ...
Prior to the late 1950s there was little if any involvement in CEDA by the so-called “national ...
  As 2017 marks the 150th anniversary of Confederation, we take a look back at an aspect of ...

Looking BackThe best memory I keep from CEDA is the way that they accepted me when I came into the business. The welcome they gave to me, all of them men. (In those days there were not many women in business.) This welcome I will always remember. CEDA has played a very important role in my success.

One year our conference was in Hamilton, Ontario. Mr. Caouillette, our speaker, got lost and instead of going to Hamilton went to Toronto. I think that that was the longest cocktail hour that CEDA ever had… waiting for him to arrive. Certainly that night the head table and everyone were in good spirits.

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Looking BackLooking BackIn the 1930s to 1940s, CEDA’s Western Canada membership was very stable with old line independent companies like Horsman, Ashdowns, Brettell, Marshall Wells, Electrical Supplies Ltd., etc.

Small electrical distributors just were not acceptable for membership as they did not carry the main-line manufacturers’ goods, publish a wiring device catalogue, or employ four to five salesmen as CEDA requested.

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