The topic of material handling distributor/manufacturer relationships has been discussed for decades. The topic is nothing new, but it is one that is manageable. The partnership between distributor and manufacturer is similar to a marriage. No, it’s not like the “throw-away, Hollywood type” of marriage, but it is rather like a bond that we both intend to take to the grave. Because of that, it is necessary to give very careful consideration to the material handling partnerships we form.
It is necessary to study how the product will complement the distributors’ core competencies and strategy of going to market. It’s necessary to consider a manufacturer’s financial strength and their current and future plans to go to market. Study their product.
When manufacturer/distributor relationships are not hitting “peak performance” levels, it is normally a result of one major fundamental shortcoming: communication. When our ability to communicate with each other falters, poor results (and typically hard feelings) are sure to follow. Think about it. If you don’t talk to your spouse, your kids, your friends or anyone else important in your life, your relationship is going to suffer!
Most lift truck distributors have signed exclusive distribution agreements. That said, we have all of our eggs in one-another’s basket. We have to perform together to be successful. Again, it seems very simple. We are constantly discussing our expectations of service, quality, product selection, availability, etc. that we require. We also discuss, on an ongoing basis, what it is that is expected of us. You can really boil it all down to a couple of very simple life rules. Communicate. Communicate. Communicate.
Benchmarks dictating acceptable performance levels are necessary. Most manufacturers now have a set of criteria to meet for achievement of “Dealer of Excellence” or “Dealer of Distinction” type awards that plainly state the expectations necessary to insure success. Many manufacturers host Dealer Councils or advisory boards in order to stimulate the dialog necessary to keep all of us on the same page.
Know, Understand and Appreciate
When it comes to the partnership between the distributor and manufacturer, both parties must know, understand and appreciate each other. Many lift truck manufacturer/distributor relationships were tested in the business boom of the decade of the ’90’s. Everyone was experiencing success (often in spite of themselves), and it seemed apparent that controlling the entire supply chain, all the way through distribution, was an easy next step for manufacturers. That line of thinking was very costly for many who thought that way. We all provide a necessary link in the chain and having mutual respect for our positions is imperative for our mutual success. Distributors know their locale and its pulse far better than a far-off factory. We must, therefore, cultivate and use that knowledge to both manufacturer’s and distributor’s benefit.
Perhaps most important, both the distributor and the manufacturer must remember the Golden Rule. As business partners, we must treat each other as we ourselves wish to be treated. We must be honest. We must do what we say we are going to do.
We are all in this together. By working together, we can make material handling a better industry.