Few things can derail a productive day more than running from store to store, piecing together everything you need to get the job done.
Imagine how slowly projects would move if electricians and contractors struggled to find the cables, wires, and accessories needed to power an office building. Thankfully, electrical distributors are there to help.
Companies rarely produce everything necessary to complete a job, relying on others for parts. Ford, for example, makes the car, but it doesn’t manufacture the tires, oil, or muffler. You’ll need to visit a dealer or auto shop if you want to buy those items.
The same is true for the electrical supply chain. Kris-Tech makes copper wire, but we don’t make conduits, pipes, or cable trays. However, an electrical distributor likely carries our wire, along with conduits, connectors, and myriad other things.
Distributors are a one-stop shop for electricians and contractors who don’t have time to search for everything. They also fill a critical role in the global supply chain by giving manufacturers like Kris-Tech a place to bring their finished products to market.
Technology is drastically changing how people shop for everything from baby clothes and protein powder to copper wire and building materials.
The internet has been the biggest game-changer for manufacturers, distributors, and consumers. With the right tech stack, distributors can maintain accurate inventories, compete online using e-commerce platforms, and offer personalized customer experiences.
But technology sometimes creates threats. Competition is getting stiffer, leaving distributors fighting battles alongside other distributors and occasionally with the manufacturers they work with.
More manufacturers are experimenting with direct-to-consumer (DTC) sales models, generating additional profits while keeping prices low. However, that move comes with the headaches associated with an entirely separate supply chain model. Even then, the manufacturer likely can’t supply all the products needed for a particular job because they don’t make them.
To maintain a competitive advantage, distributors could lean into their vast amounts of collected data to improve internal operations and expand into new markets. This could boost the supply chain, making it easier for consumers to get products and services quickly. It may also build better relationships between distributors and their manufacturers.
Better data management can improve distributor/manufacturer relationships too. When distributors embrace new forms of technology, they potentially develop better communication lines with their partners while reducing human errors, contract penalties, and other pitfalls.
You may be asking yourself, “what’s an omnichannel?” Simply put, omnichannel means “all channels.”
Distributors can connect with customers across several devices, from the smartphone in your hand to your desktop at work to the laptop you bring on vacation. Thanks to the omnichannel, customers can stay connected with their favorite brands via email, text message, mailers, website, social media, and many other methods!
It seems complicated, but the omnichannel has some benefits. It allows distributors to stay top-of-mind with their customers, prospects, and partners, no matter where on Earth they are. When attention spans are short and everyone is competing for attention, staying in front of your customers on every device is pretty powerful.
The omnichannel also makes it easier for customers to buy from you. Let’s say a contractor learns they need 500 feet of tracer wire to complete a job. They start ordering on their smartphone, then get distracted by lunch. Two hours later, they visit the distributor’s site on their laptop to finish their order.
Thanks to the omnichannel, every device is connected, giving customers the freedom to order how they wish. Simplifying and streamlining the purchasing process helps distributors maintain positive customer relationships while generating opportunities to increase market share.
Sure, you could send an entry-level employee to the warehouse to count everything by hand, but why do that when there are simpler (and more accurate) methods available?
Inventory tracking is more than simply having products in stock. When done well, it opens the door for higher profits, less waste, and fewer poor performers taking space on the shelf. Machine learning and artificial intelligence (AI) simplify the inventory tracking process, allowing real-time access to inventory.
Remember the entry-level employee you sent out to count products? Turns out he’s terrible at math. You know what isn’t? Artificial intelligence.
Machine learning improves as it gains information, producing meaningful insights that make stocking decisions more accurate. It doesn’t miscount either – provided correct data is entered into its system. As the saying goes, “People lie; numbers don’t.”
Another benefit of inventory tracking software is a reduction of first-come, first-served order fulfillments. This is a reactive process dependent on having stock available and does nothing to address critical customers who need materials but have to be put on the backburner.
Machine learning helps distributors go from a first-come fulfillment strategy to a more proactive method of serving the most critical customers first. As a result, distributors can avoid failure-to-fill problems that often result in angry customers and uncomfortable talks.
If you’ve ever eaten fast food, you’ve likely been upsold. It’s an age-old trick that converts, but technology makes it even better.
There is no shortage of software available today that can simplify the online upselling process. In many cases, these programs rely on historical purchase and inventory data to make product recommendations based on a customer’s current cart. If you’ve ever shopped with Amazon, you’ve likely experienced some high-end upselling in action. The retailer relies on advanced machine learning and algorithms to determine products you would like based on what you’ve looked at or added to your cart.
Offering value-added products opens the door for further partnership between distributors and their manufacturing partners. When the two sides work together, they can quickly address issues when they first pop up and anticipate future needs before they become problems. The result is a solutions-oriented approach that puts the customer first.
Value-adds on the service side make sense, too. By focusing on customer service, distributors can defuse situations before they become costly. Customers also benefit from the experience, as it more closely mirrors the service they’re used to receiving from a traditional B2C (business to consumer) outlet. In turn, these customers typically have higher lifetime values than those who receive poor service.
Technology has improved by leaps and bounds since the COVID-19 pandemic began.
Companies are challenged to work together in new and innovative ways, opening the door for better communication and partnerships between manufacturers, distributors, and consumers.
Whether it’s maintaining critical stock levels or ensuring products arrive on time, new technology is helping distributors create seamless purchasing experiences. For the companies that take advantage, the result could be happier customers, new markets, and maybe – just maybe – a better bottom line.