Weaving the ‘Amazon Expectation’ into distribution’s future

CEO Study: What three things would you focus your business on to differentiate yourself in the marketplace?”

The “Amazon Effect” has led to considerable growth and evolution in consumer expectations and behaviors over the past five years. Remembering the first law of sales (that purchasers are still humans—even on the job), it is logical to assume that personal experience will lead ‘industrial expectations.’

The last downturn continues to be brutal in its severity. How did you like this year’s first quarter? It is also highly unusual over the last 60 years in the heavy-duty industry and probably a tail event in probability terms. If distributors and suppliers are letting capital and strategy decisions be influenced by an extreme market contraction that is not likely to reoccur, they are probably moving too conservatively and too slowly.

But growing through this flat spot takes vision and execution. Companies have neither the time nor resources for a dartboard approach to growth. For heavy-duty distributors inclined to go the niche, technical sales (value-added services) route, national capabilities through a group affiliation, a highly trained and knowledgeable sales force (with provision for continuous education), and strong bench or service bay capabilities are a must.

Mid-size companies—those just big enough to have lost some nimbleness and added layers of support costs but too small to be generate the cash necessary to sufficiently invest in the business—are at risk.

Companies need to plan how to add sufficient scale, boost their technical bonafides, or exit the business.

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