Canadian Electrical Wholesaler

Mar 25, 2021

Frank HurtteBy Frank Hurtte

Earlier, we talked about the impact of distributors and their customers working remotely and how the changes impact distributors. In the eyes of many, the story would end here. However, a distributor is a middleman, the entity positioned between those consuming and those creating products. Distributors are a critical part of what could officially be called the supply chain.

A bit about the supply chain 

A supply chain is a network between a company and its suppliers to produce and distribute a specific product to the final buyer. The companies providing raw materials to supply-partners are part of their supply chain. The distributor and supply-partners are steps in our customer’s supply chain.

If the distributor’s supply-partner experiences delivery issues and the distributor cannot deliver, the customer’s supply chain is impacted. If the distributor mishandles an order, once again the customer’s supply chain feels the pain.

Another portion of supply chain management involves forecasts and feedback from sellers in the field back to the factory making a product. To illustrate, let’s look at a product like a programmable controller (PLC). The product is produced using a wide range of “raw materials” ranging from printed circuit boards to electronic components, along with less high-tech things like plastic housings. If there is a shortage of any of these products, no PLCs can be made or shipped. If a company fails to predict dramatic upturns in the economy, they cannot anticipate the need for the raw materials going into their product. They suffer two ways: 

• poor delivery to their customers

• higher costs for materials that must be purchased outside normal supply contracts

How does this impact the distributor/manufacturer relationship?

Returning to the topic at hand, we are talking about the impact of COVID-19 on people. Nearly all supply-partner field sales teams have been under very strict lockdowns; definitely more stringent than their distributor counterparts. Reports are these lockdowns will be in force for longer, perhaps significantly longer, than those of their distributor counterparts. Exacerbating this fact, most supply-partner salespeople lack the deep customer intimacy enjoyed by distributors. This translates into fewer customer interactions during the pandemic. Manufacturers are starving for the kind of information needed to build solid forecasts. Hence, our first point.

Distributors should expect questions and provide answers tied to opportunities being tracked with customers, the chances of success with those opportunities, and competitive activities focused on specific customers. Supply partner managers are leaning heavily on their teams to gather and report the information on a monthly (or more frequent) basis.

Many have cut their salesforce

Reports from the field indicate many supply-partners cut their salesforce during the pandemic. This points to manufacturer-based sellers being stretched even thinner than before. One could surmise distributors will be asked to provide even more opportunity/order tracking in the new normal.

Distributor salespeople, who are often tight-lipped about opportunities, must understand the reason for the calls and sometimes seemingly extraneous reporting required. Providing this information will serve to stress the importance of their distributor partners. Pushing further, distributor managers should have candid conversations with key supplier sales management to set ground rules on how the information will be used and eliminate potential outside interference from manufacturer salespeople who are not intimately involved in the process (and may not fully understand the customer dynamics).

Expect more responsibilities to fall on distributors

Historically, manufacturers typically find the need to reorganize their teams during or immediately following recessions and economic disruptions. The tea leaves point to a similar story as we move into the new normal. In fact, several manufacturers have already started laying out these changes.

These changes have fallen into three categories:

• elimination of field-based technical or support people. In order to maintain the same level of customer support, distributors will need to rely on product specialists and others to field customer application questions. While manufacturers will funnel calls to technical hotlines or customer support numbers, experience indicates customers demand faster response time than is often available through these channels.

• consolidation of inside sales help into regional or national centers. Once again looking at previous moves of this nature, distributors will need to work on developing advanced skills on the distributor portal to solve routine problems as well as develop tools for getting to the right person at the manufacturer’s regional center.

• larger territories for the remaining sellers. Supply-partner sellers will be pressed for time. In the crunch, they will be more hesitant to invest time in distributor training. Internal training will fall more heavily on the distributor’s team which has been a trend since the Recession of 2008-2009.

Expect more supplier people in flex worker status

Following the 2008-2009 recession, supplier outside sales teams were relocated to home office environments. The move created a few ripples among sellers with young families, but for the most part the transition was without distributor-related issues. A few distributors took advantage of the situation, however, to create even closer bonds with key suppliers. Here is a short list of steps taken:

• a special workspace for select suppliers in the distributor facility. Sometimes a person needs a workspace to maximize their time between customer visits. A dedicated workspace equipped with a computer connection, printer, fax machine, and scanner makes for better productivity than a coffee shop or working in the car. Providing this improves both the interactions between the distributor and the supplier as well as productivity.

• use of the distributor conference room for customer meetings. There will be times when there is a need for a working customer meeting. Rather than meet at the local Starbucks, the supplier salesperson is allowed the use of a conference room for such meetings. Since the meeting is being held at the distributor’s facility, the customer better appreciates the connection between the companies.

• use of storage for large demos and other equipment. Many supplier salespeople have a large assortment of demos and samples. Some report large sections of their garages full of this type of equipment. Assigning a spot for them to store at the distributor does two things. First, it encourages them to share with your team. Second, it provides easier access for joint calls and serving customers.

• access to a literature storage area. If suppliers have access to your literature area, they can be charged with maintaining an adequate supply and keeping things organized. This provides more and better-maintained tools for the distributor team too.

• Shipping/receiving of incoming literature, demos, and other things. Why not create a special account for supplier partner sales teams who need to ship equipment to customers or back to the factory? The extra productivity frees them from waiting in lines at the local UPS store.

A few parting thoughts

The areas covered in this article focused on the selling side of the business. There will be similar issues faced with marketing, accounting, and dozens of other interactions between distributors and their supply-partners. Time and readability hampered us from touching on each one; however, your comments and suggestions on the topic are always appreciated. If you have discovered something that works exceedingly well for your organization, please shoot me an email or just comment below.

Frank Hurtte is the Founding Partner of River Heights Consulting. He combines the battle scars of 28 years of front line "in the trenches" experience with over 13 years of service to knowledge-based distributors and their manufacturer partners. Email or call today to make these virus-driven times work for you: www.RiverHeightsConsulting.com.

Jean-Pascal TricoireBy Jean-Pascal Tricoire

The challenges facing industry at the moment are tough: supply chain disruptions, recurring lockdowns and lingering travel restrictions, to name just a few. We’re all trying to find the balance between overcoming these challenges while working to a future where we are more resilient, sustainable and efficient.

But today’s efforts are not enough. We’re being too conservative. More of our collective energy needs to be spent on the practical “how” — the “how can we get there with immediate actions.” 

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RittalIt is April 1, 1961, when an international success story begins in a small weaving mill in central Hesse — the standardization of enclosures. Rudolf Loh founds the Rittal company and changes the industry with one idea. The standard enclosure is used in millions of product solutions in over 90% of all industries worldwide. Rittal is the innovation and world market leader for enclosure technology and IT infrastructure.

10,000 employees worldwide work on new innovations, industry solutions and business models. A small steel manufacturing company has become a global digital enterprise. 

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David GordonBy David Gordon

Electrical distributors are at a unique moment in time where they have an opportunity to leverage technology to utilize the data it can unleash to accelerate profitability and sales cost-effectively.

Being in an information age is only beneficial if the information is utilized. Enhanced sales models, sales opportunities and servicing systems are combining to help differentiate distributors. Aside from a distribution divide being created by digital and supplier selection, analytics can either widen or tighten the divide.

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GDP - January 2021Real gross domestic product (GDP) rose 0.7% in January, following 0.1% growth in December. This ninth consecutive monthly increase continued to offset the steepest drops on record in Canadian economic activity observed in March and April 2020. However, total economic activity was about 3% below the February level before the COVID-19 pandemic.

Both goods-producing (+1.5%) and services-producing (+0.4%) industries were up in January as the 20 industrial sectors were nearly evenly split between expansions and contractions.

 

 

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Swati Vora-PatelBy Swati Vora-Patel

April has been a flagship month for new milestones: it has been one full year since many of us began working from home; Zoom and other such virtual platforms have been in play for a year to keep us connected – and the reliance on digital systems has heightened over the past year to populate the influx of online catalogues and eCommerce sites.

April also marks one year since I took over the reins of EFC’s Supply Chain Network to support the electrical industry’s digital transformation journey. 

 

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Changing Scene

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Leviton

The Atlantic & Ontario YPN regions have joined forces to present YPNs with this professional development webinar. 

Date : May 5, 2021
Time : 2:00 pm to 3:30 pm EST
Location Zoom meeting
Cost : $20 (plus taxes)

More than ever, interpersonal relationships are a crucial factor in the success or the failure of an organization but also in the fulfillment of its individuals. Far away from being an easy competence to develop, soft skills might be the determining factor that will make the difference in your professional career. This webinar will give you tools to help boost your motivation and your performance in order to reach your goals, both professionally and personally.

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With his vast knowledge and experience from the PAC world and his engineering background, Bogdan will lead the ISG team in continuing to provide value-added services such as proof of concept design support, MCP design, training, and other technical services and support for our customers.

 

 

 

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Over the quarter, changes in market prices led to a $345.3 billion increase in Canada's net foreign asset position. Major foreign stock markets outperformed the Canadian stock market in the fourth quarter. 

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The process of selecting the correct fixture is easy. Select a housing and trim that include a few customized features to create the fixture Product Code. Orders can be placed at orders@verozza.com or by phone at 833.VEROZZA.

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BridgeportBridgeport Fittings’ patented Mighty-Align® Steel Slip EMT Couplings eliminate the need for additional components when installing Prefab EMT racks. The couplings can also be used to join two lengths of conduit in tight, limited space applications.

Bridgeport Fittings’ center set screw feature provides the UL-required conduit stop while a convenient sight window allows for visual inspection of proper assembly. The steel slip couplings’ ability to back out the center screw allows the coupling to be temporarily placed on one conduit end while the other conduit is moved into position. The slip coupling can then be slid into place, joining both conduits.

 

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Peers & Profiles

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My first question to David was, what has happened in those six years? “Everything,” he said, and he started to laugh. “Obviously, we faced a lot of disruption from LED technology. 

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Rob DewarBy Line Goyette

Rob Dewar is President of AD Canada as of this past January, when AD announced it had made the strategic decision to establish AD Canada as a distinct business unit, serving the more than 150 members of its three Canada-based divisions. I recently had the chance to virtually meet Rob. I met a passionate leader about his new challenges.

“There are many projects in progress and specific to the Canadian industry and industry players. Interesting initiatives for the fall of 2021 will be announced shortly”. As Rob Dewar confirmed...

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