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Mike Marks of Indian River Consulting Group says distributors need to break out of the traditional mold of doing business and think differently about how to stand out in an increasingly busy market. In today’s business climate, distributors must do more to maintain their edge.
This is an exclusive summary of the recent MDM Webcast, What Distributor Innovation Looks Like in 2013: Rethinking Your Business Model. The program is available on-demand or on DVD at www.mdm.com/innovation.
Market share incumbents held hostage to the old ways of doing things are losing ground to “rule-breakers,” innovative market share challengers with a fresh perspective, according to Indian River Consulting Group’s Mike Marks in the recent MDM Webcast, What Distributor Innovation Looks Like in 2013: Rethinking Your Business Model.
History shows us that incremental improvements to the same business model can lead to success. The successful automotive company Porsche, for example, has focused on continuous product development along the same platform for years. And Marks says …
This report was formerly called the Inflation by Commodity Group Report.
This report is researched and produced by MDM editors. View the Third Quarter 2012 pricing trends report here.
These product groups provide a snapshot of inflation trends based on the Producer Price Index from the U.S. Bureau of Labor Statistics. Fourth quarter 2011 pricing levels are compared with fourth quarter 2012, and third quarter 2012 with third quarter 2012. Full-year 2011 pricing levels are compared with full-year 2012.
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Industrial
Construction
Electrical
Other Related Electrical
Power Transmission/Bearing
Fluid Power
Plastics
Fasteners
Hardware
Tools
Gases/Welding
Paper
HVACR/Plumbing
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Ferguson has acquired Grif-Fab Corporation, a distributor and fabricator of fire protection systems with three locations in Colorado, Arizona and New Mexico. In the year ended Nov. 30, 2006, Grif-Fab had revenue of $28.3 million.
UK-based Wolseley plc, Ferguson's parent company, has recently made three other bolt-on acquisitions in addition to the Grif-Fab buy. The four in total will add 29 million pounds, or $37.7 million, to annual revenues.
Since Aug. 1, 2006, Wolseley has made 33 acquisitions in Europe and North America totaling 342 million pounds, or $458 million.
According to recent news reports, St. Gobain has put its abrasives unit up for sale. Forbes reported that AFX News carried the news, but St. Gobain would not comment on the possible sale.
St. Gobain's abrasives unit had 2005 sales of 1.4 billion euro, 4% of the Group's total.
Competitive pressures, a history of operating losses, limited stock liquidity and trading volume, and the cost of complying with Sarbanes-Oxley all played a part in leading Strategic Distribution to give up the public life and agree to sell to Platinum Equity for $10 a share, or $30 million, last month.
A  ; Purdue University research project by Steve Epner is trying to understand key reasons why distributors adopt technology. Please take this brief survey now -- less than five minutes to complete. Your participation is completely confidential and makes a difference in the quality of the results. Only summary data will be published. Watch MDM for results in June! Please invite other distributors you know to participate by using the “Forward this e-mail link above. The more responses we have, the more we can learn. Thank you!
Take the survey ...
SKF has acquired the Preventive Maintenance Company Inc., Elk Grove Village, IL. PMCI has 70 employees with annual sales of about $10 million.
PMCI is in Predictive Maintenance services for industrial customers in the pulp and paper, metals, food, automotive and other industries. The PMCI acquisition strengthens SKF in reliability services, condition monitoring products and maintenance strategies.
The integration of PMCI into the SKF Group has just started.
Related Links:
SKF Group Sales Grow 8.3% in First Half
SKF to Buy Austrian Industrial Seals Co.
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Ferguson has acquired Cal-Steam Supply Inc., a distributor of plumbing products with 10 locations in the San Francisco Bay area. Cal-Steam had sales of $148.6 million in the year ended Dec. 31, 2005.
Ferguson's parent company, Wolseley, says the acquisition will benefit from its new Stockton, CA, distribution center to be completed later this year.
Ferguson has also acquired Guntersville Fabrication and Sprinkler Co. Inc. and Guntersville Pipe and Supply. Guntersville distributors and fabricates fire protection systems with three locations in the Southeast. It serves Ohio, Florida, Georgia and Louisiana.
Guntersville had sales of $31.5 million in the year ended Oct. 31, 2006.
Related Links:
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Harvard Business School Professor John Kotter recently spoke with MDM Editor Lindsay Young about his new book, A Sense of Urgency. Kotter has researched and written a series of leading books on change management including Our Iceberg is Melting, a tale of business change told in fable form. Kotter says one of the biggest mistakes organizations make when pursuing change is not creating a high enough sense of urgency among employees to spark the needed shift in direction. The current economic situation has exasperated change efforts in many companies.
As Kotter says in his latest book, A Sense of Urgency: At the beginning of any effort to make changes of any magnitude, if a sense of urgency is not high enough, and complacency is not low enough, ...
Distributors can improve shipping predictability and decrease costs by reevaluating how they receive product from their suppliers. This article looks at how LTL is a little-considered option but can cost half that of parcel delivery and a third of overnight air deliveries.
Beyond renegotiating existing contracts, many wholesale distribution executives don't consider changes that can be made to shipping procedures to save money and improve cash flow.
It's like this is the way we've been doing it for so long, we don't think that there is another way, says Doug Savage, president of Bearing Service Inc., Livonia, MI.
But reevaluating shipping options and processes to get product from the manufacturer to the distributor can lead ...
One commentator on the Harvard Biz Twitter feed recently wrote: Downturns are as much about psychology as about GNP, about withering confidence as about shrinking employment. (See the feed here.) It may be hard to grasp the idea that some of what is happening may be controllable in the current market - especially with today's unemployment jumping to 7.2%. But there is certainly no shortage of advice on managing through a downturn out there - and every author says there are ways to seize on opportunities despite the tough times.
Another article on the topic popped up this week in BusinessWeek, titled
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