The changing role of the distributor has had a dramatic effect on the role of the supplier. "With continued competitive pressure, the role of the distributor to be a problem-solver and resource center is increasingly important," says Megan Mazur, manager of market development for Franklin International. "This is achieved by proper training by manufacturers and open lines of communication to the manufacturer."
William Byrne, vice president of marketing and sales for BHK of America, says that distributors' customers are looking for more than a place to buy products. "They are looking to the distributor as a source of information and education in helping them run their business more efficiently and profitably," says Byrne. "Many of the smaller custom shops can no longer afford to make time to go to trade shows or seminars; they are looking to the distributors, manufacturers, trade magazines and associations to provide them with the information they need to run their business."
Although the Internet has been helpful in providing service, the personal touch can't be underestimated, says Byrne. "We are constantly looking to develop more products that can be sold through distribution that allow the smaller shop to produce more and participate in larger bids without having to invest in more equipment and allowing the distributor to participate more in the value-added manufacturing process to their accounts that they have been unable up to now to participate in, making them even more important to their accounts."
Most suppliers primarily rely on distributors to promote and sell their products. Key to making the supply chain work is for the supplier and distributor to maintain very good relationships with each other.
"We see our distributors as customers, partners and channels - we make a special effort to support them and help them remain differentiated in a competitive marketplace," says Jenn Downes, director of marketing and sales for Westech Aerosol. "In that light, selective distribution is very important, along with constantly innovating to bring new products to our customers."
In the hardwood plywood distribution channel, the focus used to be on 'pushing' available materials through the marketplace, says Todd Vogelsinger, director of marketing for Columbia Forest Products. "The trend is changing to one of a 'pull' strategy, in which the visible and invisible benefits of the material itself must be communicated to the wood-use shops (yield and put-through rates, true 'out the door' cost, panel optimization, green compliance)," says Vogelsinger. "There's a tremendous opportunity to reach further and communicate to these wood-using shops' customers (homeowners, contractors, specifiers). These are the people who, through their buying power, keep us all in business."
Distributors continue to supply and promote products, as well as credit and other general services, says Rick Liddell, senior vice president of sales and marketing for VT Industries. "Today, distributors are becoming more of our product consultants at the local level. They work with builders and architects to address specification and application needs, as well as supporting the retailers and K&B dealers to position our premium products, including premium laminates to compete with stone and solid surface countertops."
Putting products forward
"It is more critical than ever for distributors to differentiate themselves," says Bill Arscott, marketing and product development manager of ITW TACC, "and our products give them an opportunity to add value through educating end-user customers."
Before, companies such as Wood Technology relied on distributors to sell and support its functional and decorative hardware. "As the majority of these items have become commodities, we have further developed our range to include very specialized electric height adjustable systems which provide dynamic movement in furniture and cabinetry," says Mark Fink, president of Wood Technology Inc.
The cabinet lighting is another example of a product that has evolved and grown in the past 15 years, says Brad Stewart, director of sales for Hera Lighting LP. "When we first started, woodworkers wanted nothing to do with anything electrical or anything with a plug and cord. One by one, our distributors helped us to educate customers. Once their customers saw the added value and profit lighting can add to their offering, we were able to break through and become a leader in the industry."
When VT Industries introduced three new edge profiles to its laminate countertop line in late 2007, Liddell says that its distributors were instrumental in the success of the product. "As a result, sales of the new products are now approximately 10 percent of total sales," he says. "They have assisted with cabinet shop sales, K&B dealer sales and builder acceptance."
QuickScrews executive vice president Rick Gentry says, "We are constantly evaluating new products that are being introduced by major hardware companies and determining the best screws that should be used to attach these products to wood. Our goal is to stay ahead of the game, which we have achieved through our field work and constant training program.
Connecting to people
The distributor definitely provides added value to the customers, says Fink. "They also provide the local connection which allows people to do business with people and not just a company."
And that local connection is a big part of the distributors' job. "The distributor is our direct line to the customer," says Tom Phillips, president and COO of The Kerfkore Co. "They are able to provide materials at a location that is accessible to the customer and in a quantity that will work for the customer. Our business focus has gotten much higher for sales going through the distributor network instead of direct sales."
Supplying a great product and excellent customer service are not enough anymore, says Stewart. "We had to have knowledgeable feet on the street. Our distributors filled that void then, they do now and they're even more important as technology continues to evolve."
Distributors have always been the way that Blum Inc. has reached the cabinet shops and small-to-medium-sized manufacturers, says Dennis Poteat, marketing communication at Blum. "Our sales representatives travel with distributor reps all the time to promote new products, help customers solve problems and suggest new solutions," says Poteat.
"We are seeing more and more requests from our distributors for additional products in order for them to deal with fewer companies, so they can keep their costs down," says Bob Reesor, sales and marketing for Rockford Process Control Inc. "Distributors are also not as enamored with products from China as they were four or five years ago. We are starting to see a movement away from off-shore products and staying more with domestic options. The cost advantage once available in China is beginning to erode due to higher production costs, along with the increases in transportation costs."
Another way suppliers help the distributors is by selling in smaller quantities. "We are noticing now that distributors are typically stocking much less product than ever before. With that in mind, we have made it possible for them to buy in smaller quantities rather than requiring them to purchase via case quantity only," says Nicole Kosheba with Century Hardware. "We ensure the distributor has access to our inventory and the ability to order free samples for their customers."
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