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You Rely On”
Is finally here!
OHS, he explains, sells to end users as well as resellers
because multi-plant customers want to buy from one entity
nationwide and get delivery fast enough so they can lower
their spare parts inventory. In addition, end users are deliberately bypassing distributors and master distributors to get
better prices, especially on commodities or anything they can
“This is driven by their marching orders that have changed
from holding increases down to no more than two percent a
year to lowering their costs two percent a year — or else.”
The Changing Landscape
Another reason OHS sells to end users is the changed landscape of competition.
“ AmazonSupply.com has no high-end retail stores, skilled
technical salespeople, service centers with skilled labor, geo-
graphical restrictions, or market segment restrictions. They’re
the emerging competition of today,” he says. “Why replicate
the hub-and–spoke model of the 1950s that is now starting
to see a shakeout similar to what happened to the hardware,
video, and book selling segments? Today’s industrial distribu-
tor needs to look at the best in business, not the best in ‘their’
business. Reformation will delay the inevitable; only transfor-
mation will help a distributor navigate these stormy waters.”
Winkel, who was a driving force behind the founding of
the International Sealing Distribution Association, adds he is
still an industrial distributor and understands a distributor’s
sensibilities. “That’s why we offer a private label program so
someone reselling our products doesn’t compete with the
same brand,” he says.
He points out that distributors must either become a high-tech firm that provides engineering products and services,
like Steel Toe, or offer a business model that has uniqueness,
enabling it to compete on the Internet.
“Distributors have responded differently to our model.
Some just can’t get around the fact that OnHandSupply.com
will sell to anyone who pays us. If you offer open e-commerce,
you can’t really control who you sell to,” he says.
In a follow up e-mail with ID, Winkel offers a warning to distributors on the need for change. “We are aware of the potential disruptive ripples or even tsunamis an AmazonSupply.com
or OnHandSupply.com can cause,” he says. “We chose to deal
with change head-on and hope to succeed. Changing course
for an industrial distributor is as difficult a job as turning a
super-tanker. But to avoid their own Exxon Valdez, they must.”
Jack Keough is contributing editor of Industrial Distribution.