Let’s start by making a baseline assumption that I think everyone in the room can agree with: For an industrial distributor, owning the shop floor means having a deep understanding of a customer’s operations and supply chain needs. It means being the go-to source for all industrial supplies, parts and equipment necessary for the manufacturing process to run smoothly.
3 Benefits of Owning the Shop Floor
1. Owning the shop provides clear visibility for the distributor.
By owning the shop floor, the distributor becomes a critical partner to the customer, providing not just the necessary products but also expertise in their use, maintenance and replacement. It means having a presence and visibility on the shop floor, working closely with the customer’s maintenance, operations and procurement teams, and providing personalized service and support to ensure that the customer’s operations run efficiently and with minimal downtime.
2. Distributors get a holistic view of customer needs.
Owning the shop floor also means being proactive in identifying opportunities for improvement and cost savings. The distributor should be able to:
- Analyze the customer’s procurement
- Maintenance and operational data
- Track spending
- Identify areas where the customer could benefit from a different product, improved inventory management or more efficient procurement practices.
By taking a holistic approach to the customer’s operations, the distributor becomes an invaluable partner and helps the customer achieve their business goals.
3. A true, long-term partnership is formed between distributor and customer.
Ultimately, “owning the shop floor” means being more than just a vendor or supplier. It means building a long-term relationship with the customer, understanding their unique needs and challenges, and providing customized solutions that go beyond just selling products. By doing so, the distributor can become an invaluable partner to the customer, driving business growth and success for both parties.
Owning the Shop Floor Also Means Sharing Technology
Every customer is different; there is no cookie-cutter solution. Wherever your customers are positioned on the spectrum of small to large, a scalable software solution that helps easily manage spare parts procurement, including CMMS (Computerized Maintenance Management System) and MRO tracking, and is affordable will bring significant benefits to both the distributor and their customers.
This type of solution can help distributors improve customer satisfaction, increase sales and reduce costs. And lest we forget, if the solution integrates with your vending solution, so much the better.
Optimally, what we’re looking for is a blended solution that is equally focused on facilitating distributor sales, as well as helping customers streamline their procurement, maintenance and operational excellence processes.
This can lead to improved efficiency, reduced downtime and increased productivity, all of which will improve customer satisfaction and distributor stickiness.
I keep returning to increased sales. Increasing sales and capturing market share is why any distributor engages with a customer-facing software solution. By offering a branded suite of software solutions, distributors can differentiate themselves from competitors and provide a unique value proposition to their customers. This can help them win new business and retain existing customers, ensuring increased sales.
By helping streamline procurement, maintenance and operational processes, a distributor becomes an embedded partner in reducing manual errors, delays and inefficiencies. Distributors can also help their customers identify areas for improvement and make informed decisions about their procurement and maintenance strategies by
- Providing tools for tracking spending
- Monitoring procurement data
- Analyzing maintenance activities on a role-by-role basis
This can lead to better inventory management, reduced downtime and improved productivity — and let’s not forget, stickiness for the distributor.
Finally, an integrated software solution can be among the ultimate in value-added services. For example, distributors can offer any or all the functional modules, technical support and training to help their customers optimize their operations and get the most out of the software solution. This can help distributors improve customer satisfaction, increase sales and differentiate themselves from competitors.
The Bottom Line
Providing value-add solutions that manage indirect spend and spare parts procurement, CMMS, and MRO tracking to an end-user customer will bring tangible benefits to an industrial supply distributor.
By improving customer satisfaction, increasing sales, reducing costs, improving data analytics and offering value-added services, distributors can improve their profitability, grow their business and stay competitive and differentiated in the space. However, it is important to have the right tools and capabilities in place, including value-added services and a robust software platform with tools for managing procurement and maintenance data and analytics.
Jeff Pomerantz founded Dalworth Tool & Supply, a leading industrial distribution company, achieving an annual growth rate of 30% and securing a top market-share position. Jeff credits his success to a systemic integration of value-added services focused on process improvement, customer empowerment, driving brand awareness and increasing distributor stickiness.
Tofino was founded with the goal of revolutionizing traditional approaches to storeroom management, procurement and replenishment. Traditional strategies often limit distributors and end-users to confined set-piece relationships. By providing cutting-edge, point-of-use solutions, that include role-based visibility and access to distributor, OEM and punch-out catalogs, Tofino has created a win-win environment, mutually empowering both end-users and their suppliers.