In Material Handling, It’s About Partnership

The challenging economy of the recent past has caused many to re-think the distributor/manufacturer relationship.

By Bill Hawthorne

Some material handling relationships, tenuous during the last decade of the 90s, when all we touched turned to gold, quickly dissolved at the first inkling of tougher times ahead. Others have focused their efforts on working more closely as partners, relying on each other to insure future prosperity.

It's About Technology
Yes, the economy is different. But I believe the relationship between the distributor and his customer and the distributor and the manufacturer has been more influenced by the advances of technology than by economic conditions. The more frequent use of e-mail has created a customer who takes an instantaneous response for granted. Solutions are expected as quickly as one can hit the send button on a computer keyboard. The unprecedented speed of communications which we all take for granted is putting increased pressure on the manufacturer and the distributor to work more closely as a team, sharing information in order to rapidly respond to the demands of a savvy consumer. And together they must make better use of the technology that has created the situation in the first place.

In order to rise above the clutter and build more profitable and long-lasting consumer relationships, the successful distributor/manufacturer partnership must differentiate itself from a competitor by utilizing every resource in its combined arsenal. That arsenal must include a variety of tools which include e-mail, the Internet, e-commerce, and distance training. Each tool is a prerequisite to demonstrating the value that will separate us from our competitors.

As customers collect information regarding a particular distributor, they are searching the Internet for information detailing that particular distributor, as well as the manufacturers he represents. It is to the manufacturers' advantage that we equip our distributors with the Internet tools and a Web site that helps the distributor to achieve his and his customers' goals.

Technology must be utilized more efficiently. It will only make us more efficient and more cost-competitive.

It's About Communication
Just as technology is a boon to industry and enables us to do more with less, it has impacted the relationship between the manufacturer and the distributor and the distributor and his customer during the past decade. In some cases, relationships have taken a back seat to the computer keyboard that figures so prominently in the sales process. While e-mail has enabled more responsive communications, computers do not form relationships nor do they have feelings. We did not necessarily rely on an e-mail ten years ago. Ten years ago, all manufacturers relied on the sales force who routinely visited the distributor. Together they called on the end-user providing not only face-time, but the solutions that helped to win a sale.

The only way a distributor and a manufacturer will truly understand each other is by listening and communicating. By understanding the distributors' capabilities, objectives and expertise in his specific market, we can create win/win situations for everyone, including the end-user. We must ask ourselves how we can help the distributor to develop his market. Only then can we determine the information that we need to provide each distributor in order to help him to help his customer. Only then can we properly utilize the technology and information that we as a manufacturer possess, which can make the distributor more valuable to his customer.

By listening, we can create better and faster resolutions. We can provide the information regarding applications that the end-user requires and help the distributor to teach his customer what the product does and, just as important, what the product doesn't do.

It's the ongoing communication between a distributor and manufacturer that will enhance the winning of a sale. The trust that is achieved between distributor and manufacturer will enhance the likelihood of working together at the onset of a large project. By being aware of the entire project and not just pieces of it, the manufacturer can provide overall assistance that could just make the difference.

Better communication between distributors and manufactures is not rocket science. It begins by picking up the telephone. The second step in getting to know the distributor is joining MHEDA and participating in the various MHEDA programs. The potential benefit which will result from networking is far greater than the costs associated with membership. You get out of it what you put into it.

It's About Training and Education
Prior to the rapid advance of technology, the manufacturer relied on more frequent face-to-face contact with the distributor and a part of that face-to-face contact, without fail, included a measure of education and training. The manufacturer was expected to join a distributor's salesperson when calling on a customer, providing the necessary assistance in creating the solution that would clinch the sale.

Yet today, current technology affords us unprecedented opportunities for increased training and increased sharing of knowledge. To succeed in the future, we must make better use of those tools in order to equip our sales force with the knowledge they need in order to succeed. Management must step up to the plate and enforce a policy which requires workforce training.

As we take short-cuts in training, we run the risk of insuring that our sales force is trained to sell a commodity. It's easy to stop short, teaching a salesperson about the length, width and depth of a certain product or the capacity of that product. We must still equip the salesperson with the knowledge needed in order to integrate all of the various parts required. Does the salesperson know what questions to ask when he visits a customer who has a problem? Does the salesperson recognize the red flags that are visible to the more experienced veteran when walking through a customer's facility?

We must arm the salesperson with the ability to not only discuss features and benefits and solutions, but also how to illustrate the importance of downtime when the less expensive solution isn't working.

If that salesperson is capable of pointing out the components that will not function in a 24/7 environment or can ask the correct questions to determine the sequence of operation, the relationship with the end-user can be protected. It is the responsibility of the manufacturer to step up to the plate and help the distributor (because that's what we are supposed to do). We must eliminate the fear of selling value while illustrating the importance of each item involved in the sale. We must together teach the customer the importance of each item as opposed to the importance of the bottom line number.

It's About Securing Our Future
We cannot rest on what we did in the past. We've got to figure out new ways of securing business through not only existing customers, but through new customers as well. How do we go after new customers? There are a lot of different ways. Each time the phone rings, we must pick it up and respond quickly.

If we are to succeed, we must become closer. We must, through loyalty to each other, create brand awareness. Above all, we must continue to talk with each other. By communicating and retaining the idea that people buy from people, we create a new loyalty between the manufacturer and distributor, therefore creating and developing better Customer Relationship Management (CRM).

There are new frontiers that we must navigate. Changes in how we communicate, how we handle technology, and how we address change can be successfully managed by continuing to work together as material handling  partners.

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The MHEDA Journal • Fourth Quarter 2003 • Volume 32, No. 4 • Contents are Copyright © Data Key Communications, Inc.
All rights reserved. • Nothing may be reproduced in whole or part without written permission of the publisher.