Driving Change in Distribution
The wholesale distribution industry is at a watershed moment . Technological advances are creating massive upheavals , with industries converging , new forms of competition surfacing , and new business models emerging as never before . Distributors must navigate these uncharted waters and position their organizations to prosper in this disruptive age — a time when distributors are being bombarded by forces threatening to disrupt the way they conduct daily operations , serve customers , and interact with suppliers .
Disruption can come in different forms and from different directions — and it affects all sizes of distributors in all lines of trade . Just think of how the competitive landscape has changed over the last few years alone as companies such as Amazon have started up in relative obscurity in a specific market and now threaten to encroach on a wide range of industries . As these companies expand to offer products across multiple lines of trade and with low overhead , minimal infrastructure , and a penchant for exploiting the latest and greatest technology , they are setting the stage to disrupt the business-to-business ( B2B ) marketplace .
Although these are challenging times , the level of change occurring in the marketplace now is providing new business opportunities as well . New online businesses continue to reshape service expectations , and as those expectations transition to the B2B world , forward-thinking distributors are finding ways to adopt and adapt those models to meet changing market needs . Perhaps the greatest opportunity in all of this is the chance to become the disrupter — a role both large and small distributors can fill in their respective markets , initiating disruption to the status quo . There are many paths to take on this journey , and many strategies that can be used to combat today ’ s disruptive forces .
And the business landscape is , indeed , changing . Disruptive forces are overtaking more traditional marketplace concerns , further emphasizing the seachange ahead for distribution . Distributors responding to the online survey for the newest iteration of this report , Facing the Forces of Change ®: Navigating the Seas of Disruption , listed the macro economy as having the greatest influence on their business today . That influence is projected to decline by 11 %, but is still expected to have the greatest influence in 2020 . Price-centric competition and price transparency for many products is the second greatest influence today , but is projected to decline by 32 % in 2020 , dropping to the sixth greatest influence on their business .
The Rise of Disruptive Forces
The influence on the business by new electronic competitors entering the marketplace is projected to increase 44 % to the second greatest influence by 2020 . Also rising in importance are
38 essentials | fall 2017