The industrial distributor has been a marketing mainstay in many business-to-business market segments. The industrial distributor is the company that buys and stocks products from manufacturers and markets it to customers large and small.

There are almost 300,000 industrial distributors in the United State , which represent approximately $2.3 trillion in sales. A recent survey shows the typical distributor averages sales of around $11 million, is family-owned, and has been in business around 38 years.

Putting aside the demographics, the typical industrial distributor is facing far more challenges than in the past. Let’s consider just a few:

Customer consolidation. Customers are getting bigger as a result of growth, mergers, and consolidation. These bigger customers are demanding, and getting, more services and better prices. These bigger customers are in some cases seeking to bypass the distributor altogether and buy direct from the manufacturer.

More information. There is more product information available — information that in the past would have been available only from the distributor. A good example are the configurators that are available from many manufacturers. With these, a customer can develop their specifications rather than relying on the distributor representative.

Manufacturer expectations. Manufacturers have volume purchasing requirements. These requirements force distributors to stock up so the best prices can be had and contracts can be satisfied.

New technology and new techniques. Information technology makes customer transaction details available to manufacturers. Integrated supply chain management techniques and just-in-time inventory ...

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