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.

Carolina GalloAmong the recipients of the 2021 Clean50 Awards announced last month is Carolina Gallo, Vice President Government and Institutional Relations Canada, for Hitachi ABB Power Grids Canada. CEW reached out to Gallo, about the experience. But first, a little about the Clean50 Awards.

These annual awards recognize Canadian leaders in sustainability for their contributions over the prior two years. Created by Delta Management, Canada’s leading sustainability, ESG and clean tech focused search firm, the awards recognize remarkable and inspiring leaders and try to connect these leaders in order to bridge those gaps...

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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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Wayne Long and Jim BenderIdeal Supply is proud to announce that as of January 1, 2021 they have appointed a new Sales Manager for both the Electrical and Industrial divisions.

Wayne Long (left) will serve as thier Electrical Division Sales Manager. Wayne spent 11 years with Ideal Supply in the early years of his career, and was with Benshaw Canada for 20 years in senior sales management roles in Canada and the USA before re-joining Ideal in 2017, as thier Industrial Division Sales Manager. Long is a seasoned executive and has a proven track record of building strong relationships with customers and suppliers, and as a coach to sales teams to grow businesses.

 

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OmnicableOmni Cable located in Brampton, ON, is proud to announce it received IMARK’s 2020 Order of the Golden Maple Leaf Award in its first year eligible for the award.

The Order of the Golden Maple Leaf Award is an annual award that is presented to all IMARK suppliers who meet the set requirements, including supporting members and participating in IMARK Canada’s marketing programs.

 

 

 

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POW-R-Line CS Switchboards by EatonThe Solution to Your Switchboard Needs Now and for the Future.

Introducing Eaton’s Pow-R-Line CS switchboard, the most compact, expandable, service entrance and distribution solution in Canada. This versatile design allows for top or bottom service entrance cables, and expansion sections to the main structure to suit any design requirement.

Eaton’s Pow-R-Line CS switchboard provides a space-saving design advantage with a smaller footprint than any comparable switchboard in the market.

 

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LitelineLiteline has announced they will be establishing a Western Canada Regional Office and Distribution Center. Currently under construction in Langley, British Columbia, the new facility will service British Columbia to Saskatchewan in Canada, as well as the Pacific Northwest and California in the United States.

"As we lightly refer to the facility as “BC/DC”, the new operation will relieve some load for our 160,000 sq ft HQ in Richmond Hill, Ontario, and our other distribution points in Montreal, QC, and Dallas, TX," said the company via press release. 

 

 

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Eaton AR AppAdd or remove switchboard structures according to your construction needs, such as the main incoming with or without Canadian metering requirements, distribution loads, and submain sections. Verify your assembly footprint with thermal magnetic devices such as breakers and fusible switches (with or without meter sockets). Check for clearances and cable landing locations.

No need to guess what configuration will best suit your needs or wonder how the Pow-R-Line CS switchboard will fit in your location.

 

 

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Peers & Profiles

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Marcos has been with WESCO since 2015. We remember that in 2020, WESCO proposed a merger with Anixter...

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