What’s Keeping Distributors Up at Night

March 21, 2019 by NetPlus Alliance

By Dan Judge, Chairman and CFO, NetPlus Alliance

Last year proved to be a profitable one for our members and the overall outlook for 2019 was a good one. As noted in the year-end edition of the member-exclusive NetPlus Industry Outlook, distributors reported sales were up significantly in 2018 over 2017.

While the survey indicated that many are pleased with last year’s results, most remain cautiously optimistic about the future. I couldn’t help but notice that a number of members indicated that they fear what the changing marketplace and political climate has in store. Not surprisingly, Amazon remained a primary concern for many distributors, especially as the giant attempts to gain a political foothold and squeeze out smaller, independent distributors.

But Amazon aside, distributor members offered other worries when asked what’s keeping them up at night. The following are a few responses I found interesting and worth mentioning:

  • Contraction of our core customers’ industry
  • Fear of losing large customer business through no fault of ours
  • The threat of integration
  • Health insurance costs
  • Finding good employees
  • Underperforming ERP

It’s not just sales volume that appears to worry members. Every aspect of their business has a direct impact on their profitability and sustainability, from employee retention and satisfaction to defining effective marketing and sales strategies. These concerns are real and not going away. As the marketplace becomes smaller and more connected, distributors must fight harder to stay top of their game to win. Yesterday’s tactics simply won’t work, but partnership does.

NetPlus offers distributors an opportunity to collaborate with other distributor members and gather valuable insights on the challenges they face and to partner with supplier members and maintain an advantage over their competition through competitive pricing, superior product knowledge and training, and joint sales planning.

Not a member? Learn more about the benefits of joining NetPlus.

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