Since 1952, Lawson Products has supplied high-performance maintenance and repair products to their customers. With more than 300,000 products at every price point and performance level, their goal is that their customers will have exactly what they need to make every job, a job well done.
From setting industry standards for excellence with their proprietary brands to offering nationally recognized brands, they have built their product offering with their customer preferences and expectations in mind. For customers, that means one company, zero headaches.
Last week, SAP Customer, Michael DeCata, President and CEO of Lawson Products presented on the Industrial Supply webinar: Driving Profitable Growth with Technology in Wholesale Distribution.
In the presentation, Mr. DeCata discusses how Lawson Products, a leading wholesale distributor is transforming its business through technology. To hear more about how Lawson Products business transformation to increase profits, drive revenue growth and reduce operational costs, I invite you to listen to an on-demand version of the webinar at http://www.industrialsupplymagazine.com/pages/IS-Video-Library—Driving-Profitable-Growth-with-Technology-in-Wholesale-Distribution.php.
There are many factors to consider as wholesale distributors evaluate their technology strategy for the coming year. I encourage you to think about the following trends as you plan for your own future business transformation.
Wholesale Distribution Industry Trends
Changing Role of Distributors
Distribution is becoming more demand driven, and buyers are going directly to manufacturers for information. Distributors need to adapt their role to
prove continued value and relevance to secure their position within the supply chain. To do this, they are developing comprehensive offerings, including decision support systems, consulting and outsourcing, computer systems, and software.
Consolidation means fewer competitors; it’s also driving changes in technology adoption, product offerings and customer relationships.
Diversification of Sales Channels
Online retailers have grown rapidly and continue to grow. Omni-channel is continuing to gain a strong foothold in the distribution industry.
Manufacturers as Distributors
Manufacturers are moving directly into the distribution function rather than working through distributors. Group Purchasing Organizations (GPOs) are
negotiating bulk sales direct from manufacturers.
Drastically Changing Healthcare Environment
There is pressure to contain costs along with increasing government regulations, changing consumer demands, increasingly aggressive competition
and a growing and aging population. An aging U.S. population combined with global population growth is leading to an increase in healthcare spending. 20% of total U.S. spending is anticipated to go to health care by 2020.
Strategies to Address Wholesale Distribution Trends
As you evaluate the platform for growth of your company, let’s review some strategies that can help set you apart from the completion.
Leverage Mobile Technology
Mobile technology is a game changer and can:
- Support sales growth by increasing and simplifying sales channel for customers
- Integrate the supply chain – make distributors more integrated with customers
- Affect many supply chain touch points – warehousing, transportation, CRM, etc.
- Improve process efficiency in inventory management and delivery systems and help address industry trends of stagnant/reducing margins
Mobile technologies in the wholesale distribution industry were ranked as the highest technology priority in Gartner’s 2012 EXP CIO Survey
Millennials will be 50% of the workforce in 2020 and 75% of the global workforce by 2030. They prefer to use mobile and social technologies and innovative technology platforms
Integrate On A Single Platform
- A solid foundation to seamlessly integrate acquired companies
- A way to achieve growth goals and combat margin stagnation
- An opportunity to harmonize processes and pursue shared services
- One face to the customer, which ensures consistency of customer experience
- Flexibility to add new products to respond to changing customer demands in this rapidly changing environment
Optimize Your Supply Chain
- New technologies enable a more demand drive supply chain – customer pull vs. push
- Increase supply chain visibility to:
- Gain insights to reduce costs and improve process efficiency
- Achieve better demand forecasting , allowing for reduced backlog
- Improve inventory management
- Maintain competitive edge
As we close out the last few weeks of 2014, the SAP Wholesale Distribution team would like to thank our customers for their industry leadership and partnership. We truly value your business and your feedback about how we can help your organization succeed. We look forward to working with each of you in 2015 to assist with your business transformation, help you fuel profitable growth, better serve your customers and rise above your competition. Happy Holidays!