The 4th Quarter Issue of The MHEDA Journal is currently deep into its production cycle and will be shipped early next month. The 4th Quarter issue is typically called “The Sales Success Story” issue and this year is no different. The magazine is filled with MHEDA dealers and suppliers joining forces to save the day for end-users.
However, though it’s not the feature story, the 4th Quarter Issue features arguably the most important information for members of all four issues, MHEDA’s 2015 Critical Impact Factors. MHEDA’s Executive committee met in July and discussed the trends and challenges facing our industry today and going forward. Every year, the Board of Directors develop Critical Impact Factors that are shaping our industry. These CIF’s create the basis for MHEDA’s programing and services. I’ve spoken with members who use MHEDA’s CIF’s in their annual strategic planning.
This year’s Critical Impact Factors can be seen below:
1. Members need to evaluate and potentially modify their business model to address the significant and ongoing growth in automation.
2. There is a long term trend toward more local and regional distribution centers. This is being driven in large part by evolving consumer demands and expectations for same day delivery. Customers are responding by forcusing on Omni Channel Fulfillment. As a result, there are new and emerging opportunities to provide solutions to the customer.
3. Members must be committed to embracing a changing work culture, specifically understanding how the younger generation requires more flexibility and is motivated differently. The workplace culture may impact a younger employee’s willingness to stay in place long term.
4. The industry is facing a shortage of skilled labor and this trend will continue as existing employees retire. Additionally, skill sets for the technician in all industry segments are changing with increasing reliance on systems and software diagnostic tools.
5. Succession planning is critical not only for the dealer principal but also for key managers and senior executives. Companies adopted lean organizational structures during the recession and as a result, internal successors may not currently be in place.
6. More so than ever before, it is critical for an organization to retain their top performers. Processes need to be in place to develop and motivate existing employees.
7. There is a continued trend toward consolidation including factory-owned distributors as well as the acquisition of systems integrators within the industrial truck industry.
8. Consultants and third party management companies are continuing to target and market to end users for equipment acquisition, service, maintenance and fleet management. This is a competitive threat to the traditional distributor.
9. Safety compliance and government regulations are becoming more complex with stricter enforcement. This can be very costly and challenging for the member company but can also provide opportunities for distributors to educate and provide services to the end user.
10. Online sales of material handling equipment has led to commoditization of some distributor offerings. Therefore, distributors need an even deeper understanding of a customer’s business and need to establish a value-added, ROI, service-focused relationship.
11. Members need to be better educated on the benefits of digital marketing in particular, the correlation between social media and search engine ranking.
12. The industry may be facing an inflationary environment within the next 3-5 years and members need to understand and be prepared to operate their businesses during these conditions.
13. Fluctuating costs and regulatory complexities of health care insurance, especially those related to the ACA, continues to impact member companies and must be closely monitored.
What do you think of this year’s Critical Impact Factors? Have you seen any of these challenges first-hand? If so, how have you dealt with them? We would love to hear from you, so tweet us @MHEDA_Journal or post on our Facebook or Google+ pages. Going into 2015 armed with this information will give you a leg up on your competitors and position your company for success next year and moving forward!