The Four Pillars of ‘Distribution’

Travel back in time for a moment, and recall what a distributors job looked like a quarter-century ago, you might find some aspects vaguely familiar, others would be largely unrecognizable. A host of things have changed in the intervening years, processes and technology as prime examples, even the demands of customers have changed, from what they want to how and when they want it: Personalization, instant information and blinding speed of delivery are all expected.

With so many companies pushing hard to satisfy their customers, differentiation has never been more important than it is right now for wholesale distributors.

That’s the subject in the crosshairs of supply chain/wholesale differentiation expert William McCleave in his eBook “Stand Out from the Competition! Four Pathways to Differentiate Your Wholesale Distribution Company.” McCleave pulls out four principles that can be the difference-makers between your wholesale distribution company and the rest of the competition.

But there’s more to differentiation than just reciting these principles. The implementation of these principles is the real pattern breaker that can set your firm apart within the industry. Let’s take a deeper dive into McCleave’s Four Pathways and how you can leverage them best.

Position

If you’ve got an idea that you believe will turn some portion of the wholesale distribution market on its ear, that’s your position. It means finding the market space where you believe your company can deliver something unique, desirable and profitable. This can be something as small as providing the same product as the market leader for 5 cents less per unit to a complete takeover of a niche in a particular marketplace. Plenty of people have great ideas about what could be a profitable business, but transforming those ideas into reality is a horse of a different color. Testing the market you plan to enter takes an extreme look into the analytics of your company versus the current market environment. Upgrading your business’s infrastructure to a cloud-based ERP can deliver these analytics internally, turning the data you already have from your own operations to quantify what you can deliver to the marketplace in terms of delivery speed, price, volume, and more. Using analytics before investing precious capital into a new business venture is a great way to save time and money.

Pitch

No matter how great you might think your idea is, what the customer thinks is what really matters. Putting together what you’re offering with what they want can be like putting together one of those 1,000-piece jigsaw puzzles. Unless everything fits together perfectly, you don’t have a winning solution. The insight offered by an ERP again are a huge part of the solution to this problem. You can track different marketing campaigns and see how customers are progressing down your sales funnel. Is there a point where they are disconnecting from the sales process? Is there a particular marketing campaign that is bringing in new business faster than the others? Once you grasp what they require, your focus shifts to ensuring your processes can deliver the goods. The data you gain can be used to pinpoint specific areas where extra efficiency needs to occur to deliver the product on time with custom requirements met.

Performance

Possibly the biggest of the four Ps is the one that puts your company’s reputation to the test. Can you deliver on what you’ve advertised to customers? Can you ship the amount of goods you guaranteed, ensuring that they arrive on time for the promised price? Being able to succeed in the performance arena means knowing the capacity and current performance of every one of your current systems and how they are working together. Is merchandise sitting in your warehouse for days because they aren’t enough trucks available? Are out-of-state clients not getting their deliveries on time because of roadwork delays? Using an ERP’s ability to pin down things like the time sink, man-hour spent and the cost per process can allow you to drill deep and figure out what parts of your company must improve to keep profitability in line with expectations.

Proof

Customers need to see value to believe you can deliver what you’ve promised. They need to see that their investment in your products and services can be validated. Being able to generate and showcase results to potential customers is a perfect fit for the sales performance aspect of an ERP, which is able to give both quick views and extended looks as your firm’s sales performance for a certain period of time, a certain product, a certain area or all of the above. What can be almost as impressive for customers as the numbers themselves is the way they are presented. A cloud-based ERP can afford you the opportunity to supplement the slick brochures, slideshows and present customers and potential customers with objective data to reaffirm your capabilities.

William McCleave’s 4 Ps are a fantastic insight into cutting your own door into the wholesale distribution industry. When you take the 4 Ps and leverage them with powerful ERP business tools, you give yourself the opportunity to not only differentiate yourself in that market, but to begin taking command of it as well.