 |
The Challenges Impacting The Distributor/Supplier Partnership |
Storage and handling equipment distributors have very few, if any, contractual relationships with manufacturers. Agreements are more or less a statement of a discount structure and market area. Many manufacturers supply multiple distributors in the same market area. That being said, many of the relationships between distributors and manufacturers tend to be somewhat dependent on the question “What have you done for me lately?”
 |
Tim Colston
President
Applied Handling
Equipment Co. |
|
Valued Suppliers
Valued Suppliers are those whose products are actively marketed by the distributor. They are not to be confused with a Resource Supplier, one who can supply a product needed for an end-user's project. The Valued Supplier's products are presented as solutions for the end-user's applications. These Valued Suppliers limit distribution, provide direct field support, share sales leads, and also provide marketing assistance and product training.
The ideal partnership between a Valued Supplier and a distributor is one established over a long period of time. There is an established comfort level when both parties believe the other to conduct business in an honest and ethical manner. The supplier is expected to provide accurate information that can be relied on. Loyalty is a given.
The Distributor as Customer
The challenge for each of us when working with a manufacturer is to help the manufacturer to understand who his customer is. If the distributor is invoiced and the manufacturer expects payment from the distributor, the distributor is the customer. Period. Our partner, the manufacturer, is responsible for helping us to serve our customers, using their products. Many manufacturers are very much aware of whom their customers are. Unfortunately some are not.
Customer Loyalty
Another challenge concerns integrated supply issues. The storage and handling distributor has been shut out by integrated supply at some larger accounts. After having established business with the end-user through the storage and handling distributor, the integrated supplier takes over the repetitive business, effectively shutting out the distributor. Some manufacturers have done little to show loyalty to the distributor and have chosen the easier route of supporting the integrated supplier. This short-term approach does maintain the established business with that end-user, but doesn't bode well for the supplier's partnership with the distributor. In some cases, the manufacturer decides to go to market directly, bypassing the distribution channel. They need to stop being all things to all people. Either they market through distribution or they don't. Either the supplier maintains a measure of loyalty to his customers or he doesn't.
Communication
The relationship between supplier and distributor can be improved by practicing honest and open communication. Establish the rules. Communicate and interact consistently within the established parameters. The partners, together, should decide how the end-user customer will be served in a way that will be a win/win/win situation for all parties. If the business is not beneficial to the end-user, distributor and manufacturer, it is not conducive to a long-term relationship. On the other hand,if we are truly communicating and understanding our respective roles, we are capable of creating win/win/win relationships. |
