Material handling is a tough business to be in right now for everybody: for the manufacturer, for the distributor, even for the warehouse equipment end-user, who continues to look for the lowest-priced product with little regard for quality.
“Quality,” however, refers to more than the actual, physical product. It also refers to the quality of the company itself: its philosophy, service offerings, sales presentations, warranties and ability to handle problems quickly. Manufacturers and distributors each invest a lot into the relationship, so it is important that both sides offer quality to each other, as well as to the end-user.
How do we, as manufacturers, make the process go smoothly for the distributor and his or her customers? Well, first of all, manufacturers must provide a quality product at a very fair, marketable price that a distributor can make a profit on. Yes, it is all about profit-making. Manufacturers should understand that it is in the distributor’s best long-term interest to move away from us if we’re not providing a profitable product rated high on the quality scale. Without the quality, a low price just transfers problems to the end-user and back to the distributor. If manufacturers can’t justify that their product generates long-term value for the price, then the distributor should go find another supplier.
We must make our product hassle-free to distributors so they remain the primary vehicle to get it to the customers who need it. If there ever is a breakdown, provide very quick service, so the distributor is free from having to touch the product. Keep this philosophy for distributors: less touching and more selling.
That philosophy is important because manufacturers are not salespeople. Not too many manufacturers are good at selling. We should focus on manufacturing and let the dealers we’ve chosen be our sales professionals. While distributors have had to take on the marketing of our products, we should be providing national advertising, Web-friendly brochures, sales leads, sales training and well-trained technical support. A good, central warehouse location to provide regional service also is a major manufacturer’s responsibility and commitment to the distribution.
Another thing a manufacturer can do is personalize the product (i.e., metallic calling cards on the equipment, unique colors, etc.) to make it easier for the distributor to sell. Personalization gives distributors recognition, and that boosts all products within the organization, not necessarily just one brand. Manufacturers who actually differentiate for the distributor make the distributor’s sales process easier, and it gives the manufacturer an entry point that leads to other products.
We’re always looking for long-term value to pass on to our distributors, but at the same time, we’re expecting the distributor to pass long-term value on to us. Most manufacturers do not want to sell direct. It’s a very expensive business venture. Very expensive. We’d much rather spend our monies on manufacturing, logistics, research and development, and improving our products. We want distributors to help us develop new products for them to sell. We need their opinions, we want their ideas, and we look for their help. On the other hand, manufacturers should not be oblivious to end-user customers. We must have open, fair communication, and it must be trustworthy.
The goal of material handling manufacturers and distributors in a supply relationship should be to develop long-term relationships that establish several qualities. Those qualities are openness, honesty, mutual support and personal relationships with key individuals in each organization. Such qualities are important to obtain long-term value from the products made by the material handling manufacturer and sold by the distributor. Problems inevitably will occur, but a very good personal relationship between the parties will go a long way to a quick and fair solution to any challenge.
|Meet the Author
Mel Griffin is president of Lift Rite Inc., located in Brampton, Ontario, Canada, and on the Web at www.liftrite.com.