Welcome to ElectricalTrends.
ElectricalTrends is a communications vehicle, offered to the electrical distribution industry, by Allen Ray Associates and Channel Marketing Group. The purpose of ElectricalTrends is to share Allen Ray Associates’ and Channel Marketing Group’s insights on industry trends, observations on industry activities and issues and ideas that may benefit industry participants in their endeavor to improve their businesses in the areas of growth and profitability.
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Monday, April 6, 2009
- Distributors cutting people, branches and inventory.
- As distributors lean their inventories, their commitment to C & D items are waning.
- More distributors are "waiting" for the order, with some being more aggressive and sensing opportunities to take share from more complacent competitors.
- Margins are being squeezed as distributors respond to those who are struggling to maintain cash flow through capturing any sales.
- Manufacturers have cut personnel, changed sales strategies and are editing their marketing strategies to be more end-user focused while changing their co-op marketing funds and questioning their rebate strategies.
- Some manufacturers have spoken about reviewing their distribution portfolios and better understanding their selling propositions. At the same time they are questioning distribution's commitment to helping create demand for products.
- And everyone anticipates accelerated consolidation as well as possibly distribution closings. As a distributor, what are you positioned for? As a manufacturer, how could this affect you?
In the words of one executive, "this is the time for bold moves." Additionally, research from prior recessions has shown that sales and marketing investments made during downturns enable companies to grow at faster rates than competition and accelerate growth during recoveries. Today's Wall Street Journal article on R&D shows that investing for the future does payoff.
So what does this mean?
We see opportunities for companies to:
- Better understand their unique selling proposition and their perception within the marketplace to enable them to better position themselves to take share.
- Gain end-user / customer insight.
- Re-evaluate their distribution strategies to strengthen themselves within their marketplaces.
- Identify and develop opportunities within niche markets.
- Look forward and develop their plans for growth for today and tomorrow.
As mentioned, we will be at the NAED meeting in May, and yes, this is a solicitation! If you, or your company, is attending the conference, perhaps we should talk?
Give us a call or email David or Allen.
Additionally, if you are a manufacturer interested in the LED market, we have some new distributor and end-user research we can share.