Manufacturer-Distributor Disconnect

A few months ago, I met with the president of a large bearing manufacturer and his data manager. We were discussing their sales through large distributors, and how they support them with product information. We had gotten some insight from one of their distributors about the struggles of receiving and maintaining supplier data in all of the distributor’s different sales systems.

The data manager assured us that this was not a problem. The manufacturer had been providing complete data sets for years to all of their distributors. She was right. She had been providing complete catalog data and pricing files to their distributors. What she did not realize was that the format and structure of the data did not match that of their distributor’s systems and needed manual adjustment. As a result, only 20% of the bearing manufacturer’s products were actually loaded.

I watched the blood drain from the data manager’s face as she realized that for all of these years, their product line was incomplete, and inaccurately represented by their distributor.

Unfortunately, this scenario happens every day with manufacturers and distributors in the industrial market.

For manufacturers in particular, this situation is not only delaying market representation and sales growth, it is reducing their efficiencies, for example:

• Manufacturers who sell most of their products through distributors are losing an untold number of sales opportunities because their partners do not have all of their product data
• Manufacturers are unknowingly creating extra work for themselves in the form of customer service requests because the end customers and distributors need additional product information
• Providing product information in a format that distributors can use is a big challenge. While a manufacturer might provide the data electronically, it needs to be in a format that can be seamlessly integrated into distributors’ sales systems
• Each distributor has its own unique data and structure requirements; it is a huge effort to manually adjust the data sets to fit; most distributors are not staffed to handle the work; the result is much of the manufacturer’s product data never gets loaded and the manufacturer’s products never get offered
• Maintaining and providing dimensional product information is a challenge for the distributors; this includes drawings and models critical to describe, accurately, the product for maintenance, engineering and sourcing professionals

Manufacturers who can centralize and share complete information on every product, including attributes (e.g. hp, rpms, torque), dimensions (e.g. length, width), pricing, part numbers, and drawings, have an advantage over their competitors. These companies are in the best position to improve sales revenues, streamline processes, and increase efficiency of their channel partners.

Increased sales from full representation of a product line are the most obvious advantage, but another huge benefit is the savings due to increased efficiencies. Consider the value of the time saved, and the improved process of extracting and sharing data.

The issues creating this “manufacturer-distributor disconnect” affect manufacturers and distributors in every industry, large and small alike. It is well worth an exercise to ask yourself the following questions…

If you are a manufacturer…

• Are you aware of how much of your product data is actually loaded and represented by your distributors?
• Are you tired of spending time and money to get your product data into your distributor’s hands only to find that a small percent of your products being represented?
• Are you providing your product information in the distributor’s required format? Do you know what that format is?
• Are you frustrated that your distributor cannot find the correct product among your line to solve a customer’s need?
• Do you feel like you are missing out on sales opportunities because of incomplete product representation by your distributors?
• If you are a distributor…
• Are you frustrated that your manufacturer is not providing their product information to you in the structured data files you require for your systems?
• Are you tired of having to re-format and manually edit your manufacturer’s data whether it is from an electronic file or even worse, product spec sheets and catalogs?
• Are you concerned that you are missing out on sales opportunities when customers come to you for products and you cannot find them because the manufacturer’s data was never delivered properly?

If you answered yes to any of the questions above, it may be worth taking a closer look at your manufacturer-distributor relationship and the strategies you currently employ to share product information. I will be happy to join you in a conversation. Feel free to contact me at msprague@thomasnet.com.