Important Trends in Operational Improvements for Distributors


Invest or Exit!  With the onset of Industrial 4.0, smart manufacturing and other technological advances, many industrial business owners are facing the difficult decision to either invest in growth or sell.  Companies will find it hard to maintain the status quo without improving the customer experience.

Rajesh U. Kothari, CFA, managing director at Cascade Partners shared that companies should consider making operational improvements during the inevitable downtime that most businesses would experience during the Covid-19 shutdown.  (Read more about his points here)

Some of his suggestions included a focus on internal processes, performing preventative maintenance and building dashboards, KPIs and other analytics you have always wanted, but never had the time to analyze or develop.

Many companies are now telling stories about how they have made improvements to operations that will have a positive impact on the customer experience.

Recently, released a blog about how three distributors utilized their downtime to improve their data analytics. (Read their blog here)

“It’s really all about data. If you place an order on our website and the data is clean, that order is going out and nobody is touching it,” said John Janthor, VP Information Technology – Global at Radwell.

“We knew business was going to be down, so we made a strategic decision to use the time to invest in tools, invest in improving our business for the future,” said Rene Savage, VP, Technology Solutions, at Stellar.

Our new Industrials Report discusses why distributors should be considering similar upgrades to be able to compete in the world of Industry 4.0.  Many of the following products and services are essential today for companies that want to grow with ever demanding customers:

  • An e-commerce platform
  • Mobile tools
  • Real-time product availability
  • Delivery tracking
  • Fast, easy omnichannel experience
  • 24/7 customer service

Across many industries, the Covid-19 pandemic has accelerated technology timelines and project initiatives by years.  The industrial sector is no different.  Distributors are experiencing more change and evolution than other industries because they need to counter disintermediation, the impact of Amazon Business and the increase in reshoring. Building scale and sophistication is key to keep pace with customer demands and competitors.  Manufacturers now want to know the location of their products in the supply chain on a real-time basis.    Distributors must have technological tools that provide transparency for their customers regardless of current location.  This type of value-added service is a critical must-have, or manufacturers will find other distributors, or worse yet, go direct.

E-commerce is another area where Covid-19 is forcing distributors to invest in technology.  Companies must build out their product content on their e-commerce sites as sales-related travel has come to a halt.  Thousands of SKUs must be uploaded with the proper analytical tools available to the user.  Such a robust web site requires a significant capital investment to be done right.

Are you leveraging technology to meet the demands of the manufacturing customer in the world of Industry 4.0?  Do you have the scalability to build a robust e-commerce site with large amounts of product content?  A first-class customer experience depends on clean data and strong analytical tools to see activity inside the supply chain.

As author Karen Lamb said, “A year from now you may wish you started today.”

Interested in learning more about the evolutionary changes impacting manufacturers and distributors? You can request our most recent industrials report here.