Key business issues facing wholesale distributors
Reducing operating expenses
Wholesale distribution companies aim to improve workforce productivity. They want to enable shared services and reduce IT costs and complexity to bring down costs.
To increase margins, wholesale distributors also focus on reducing COGS. To do this, they leverage additional sourcing programs, increase vendor cost
recovery, and improve logistics management.
Servicing demanding customers
Customer retention is a major challenge. New business models and new competitors (e.g. Amazon) drive heightened competition. Wholesale distributors need to change focus from transaction focused relationships to a customer focused model.
To increase revenue, they want to improve product & information delivery, and add more value-added-services to increase revenue generating activities.
Attracting and retaining talent
Wholesale distribution workforces are typically aging and create succession planning challenges. Yet attracting talent is difficult because they younger workforce doesn’t find the industry attractive. In addition, business goals are often not aligned with changing company strategies as the global wholesale landscape changes and goes digital.