Distribution is dead (and what you can do about it)

factory workers bottling production

April 6, 2020

The distribution industry has been in a state of metamorphosis for years, with disruptors changing the paradigm of operations within the space so vastly, that the industry we once knew is effectively dead. This creates a massive problem for distributors stuck in traditional patterns of operation, with the threat of irrelevance looming ahead. Those who fail to evolve with the industry will struggle to survive in this new era. Adapting to the new distribution model is an indelible objective that can be reached by embracing the possibility of present and future, while forgoing the methods of the past.

One way to do this is by embracing technology. Industry disruptors have been leveraging technology for years, using it to expand and shift customer expectations. Netflix began as a mail-to-order service that evolved into the streaming giant we all rely on, squashing brick and mortars like Blockbuster in the process. Blockbuster’s stagnation is a cautionary tale to all resistant to change. Embrace the digital era – there’s very little to lose that isn’t already threatened by competitive disruptors.

One group attending the Unleash Innovation Summit synopsized the issue, saying: “The value we provide is no longer what our customers are looking for.”

It’s time to strategize and augment your operations to meet the needs of the modern distribution customer. You can form an innovation team dedicated to transformation. You can redefine the mission of your organization to enhance efficiencies. Or, you can be like Midwest Wheel, the large truck parts distributor that focused on customer experience – and found empowerment through operational excellence using Infor CloudSuite Distribution. By gaining real-time access to data and refining their processes, Midwest Wheel has significantly improved productivity and strengthened relationships with its customers.

While there is a roadmap to success, only you can decide how to transform and innovate. In a recent webinar, Dirk Beveridge, founder of UnleashWD, developed a three-step approach to reshaping the structure of a distributor to help adopters find their footing:

Step 1 - Embrace change. The best way to regaining a competitive edge is to remember that the goal is to innovate, not stagnate. Technology is changing too quickly for most distributors to keep up, so it’s important to embrace change and get others to follow suit. The faster you can gain support and identify gaps, the sooner you can begin implementing transformative changes.

Step 2 - Understand innovation starts with your customer. Customers are framing the way distributors innovate. Distributors work to serve customers, who in turn reward distributors with increased business, referrals, and the gift of longevity. Figure out how to lead your customers, and by extension, your organization, to a more robust future.

Step 3 - Build your case. Innovation is a process. It’s integral to your continued success that you work through key thought exercises to find long-term alignment within your organization on how to innovate and support the “Lift and Shift™” process. Lift and Shift™ refers to the act of identifying and “lifting” concepts or technologies that exists outside of your space and shifting them into your business. This exercise forces you to think beyond self-imposed boundaries and stimulates disruptive thought. This step is great for strategic planning and can be used to plot individual projects.

The next step is to get started. For a detailed guide on the current state of distribution and what you can do to revive your distribution business, download UnleashWD’s exclusive eBook, Distribution As We Know It Is Dead – Here’s What To Do About It.

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