Know who you are
Distributors must sharpen the focus on what they are and what they do
By Daniel Matis -- Industrial Distribution, 3/1/1998
Matis Inc. has been a specialty distributor to the tool, die and mold industry in Chicago since 1955. Surviving and thriving as a specialty house has never been easy, but today it is more challenging than ever.With consolidation sweeping the distribution community and the trend toward integrated supply and single-sourcing, we must work harder than ever to expand our customer base and grow our business. But it can be done. Small specialty houses can prosper in today's economy and the global environment we work in. The key is to know who you are and what you do, and to impress that identity upon your customers.
There has always been a movement towards bigger companies that provide more and more to their customers. Likewise there have always been niche players who focus on specific markets. Today, it's important for all channel members to realize that there is room for both kinds of companies. Simply put, there are products that lend themselves to each type of distribution.
Therefore, a successful manufacturer-distributor-customer relationship happens when you find the proper mix of suppliers to fill those needs. When that mix requires technical knowledge and product expertise, companies like ours work. If you're dealing with commodities, a larger, more broad-based company may be the answer.
Therein lies the whole issue. Customers must determine their needs. And as distributors, we must help them meet those needs. We fail to do that when we promise something we really can't deliver, or try to be all things to all people.
A case in point: We've had customers ask us to supply products that are not in our core area -- and sometimes we do it. But we find it's usually better when you don't handle something to refer the order to the proper channel -- fewer mistakes are made that way. With our long-term customers we don't have those kinds of problems because they understand our business well -- they know who we are and what we do. But as we look to expand our customer base and continue to grow our business, we must constantly impress our indentity upon those new customers.
One advantage customers stand to gain from companies like ours is the introduction of new technologies and methodologies to the marketplace. We're willing to take the time to go through the educational steps necessary to make that kind of a sale. Bigger companies aren't always likely to do that. Therefore, customers who limit themselves to one or two vendors are potentially walling themselves off from new ideas and technical advances in their field. We must impress this idea upon new and existing customers if we are to continue to prosper.
While dealing with a broad supplier base can be good for customers, cost reduction is a real issue that cannot be ignored. That's why small companies must demonstrate to customers the value of doing business with them. One way they can do that is by helping customers run their businesses more efficiently. We feel that our job is to convince people that we are efficient. If we can do that, they will continue to work with us. Believe me, local companies can hold on to local sources of supply if they want to fight hard enough.
At Matis, Inc. we want to continue to be part of the channel. And we can do that because there's purchasing room to recognize the value in what companies like ours provide.
The key rests in the customer's hand. It is the customer who must recognize that rather than limit themselves to one or two suppliers who do everything, they should develop a mix of suppliers to meet their requirements. And that may mean the customer has to cut five checks a month instead of one. Likewise, distributors must concentrate on what they do best, perfect it, and then capitalize on it.
In our constantly changing business climate all of this gets harder and harder. But if we all work together -- distributors, customers and manufacturers -- we can establish plans and strategies that work to all of our benefit.
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