At the PPAI North American Leadership Conference (NALC) and Tech Summit this year there was a lot of discussion around collaboration. One of the speakers, a futurist, spoke about the difference between cooperating and collaborating.
Cooperation happens as a low level activity with a scarcity mindset focused on protecting the kingdom. Collaboration is done with the goal of increasing the pie. Many distributors have been collaborating as friendly competitors for years. You see this happening on Facebook and LinkedIn groups and on commonsku where distributors help other distributors find products, come up with ideas and generally be more successful.
We are now entering a new era of collaboration on the supplier side as we see extraordinary efforts of competitors working together to achieve greater efficiency in the way we pass data. Special shout out to Bic, Hit and Starline for having initiated this.
Where the next big change in the industry is going to happen is how suppliers and distributors collaborate. In the past, the main method has been the supplier putting up a tradeshow booth and hoping the distributors would come by and see their products. This might be augmented by an office visit by the local sales rep to again present the products to the distributor sales team.
The problem with this is that it is one-way selling, not collaborating. The supplier is telling the distributor about the products without the context of who the distributor works with. The distributor doesn’t have time to share this information at a tradeshow. If the sales rep comes to visit the distributor’s office they might not have anything specific they are working on right at the moment to share with the supplier.
The opportunity comes days or weeks later when the distributor has a project where they need to come up with ideas. At that point they rack their overloaded brain to remember some of the interesting products they saw. They flip through the mental rolodex trying to pull something relevant from the 1 million sku’s that exist in this industry.
As a supplier, don’t you wish you could be having your meeting with the distributor right then? You have the perfect product for what their client is looking for! Sadly another supplier was in after you and due to that memory trick called the recency effect, the distributor thinks of one of their products instead.
Sigh.
Suppliers need to get their products in front of the distributor when it matters, when there is an actual need and your product is going to be the right fit. Distributors want to be able to tap the deep knowledge of the suppliers – you can come up with an idea from your product line way faster than the distributor.
The future of this industry is distributors and suppliers finding a way to work together that is reflective of the digital, real-time world we now live in.