Distributors Gain from Streamlining

By Chris Ilcin, Account Superintendent, Sonnhalter

For their January/February issue, Industrial Supply Magazine asked Spencer Maheu, Director at Osborn Industries what advice he had for industrial distributors in the New Year. His answer? Streamline your product selection to reward end users, your organization and your bottom line. Here’s the article:

Streamlining is the Word of 2017

In a flat or slow growth year, the best way to increase the bottom line is to look at your own processes and product portfolios, and eliminate redundancy to consolidate volume with vendors that offer lucrative programs and/or have broad product offerings. This is especially important in the abrasives category, a notoriously crowded space in the consumables market.

Multiple vendors, similar products and customer requests over the years have left most distributors with a selection full of redundancies and low sales per SKU. Looking at your offering and streamlining it offers rewards for customers, distributors and manufacturers.

Rewards for End Users

Having a streamlined, rationalized abrasives offering delivers purchase clarity and confidence, especially for distributors with showrooms and/or walk-in business. Have a brand strategy and product offering that clearly communicates to the user the best value proposition for their applications and needs. Fewer options also mean less out-of-stock risk, so you improve delivery and service to them, keeping them working.

Rewards for Your Organization

A rationalized abrasive product range will result in improved effectiveness of your sales and counter team members. It is much easier to have a deep understanding of the product you sell – the value proposition, the user applications – when you have fewer items to sell.

This deeper understanding of the product and usage will position you as the expert and make you an even more indispensable partner for your customers. Additionally, inventory management and other administrative, non-value-adding activities will take up less staff time.

Rewards for Your Bottom Line

Lastly, your consolidated volume will mean that your chosen manufacturers will be more responsive to the training and technical support needed to drive conversions and growth, and will give you more negotiating power for the best pricing. Rebates can be maximized through consolidation of suppliers as well, further adding to profitability.

Read the entire Supplier Roundtable article here.

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