What makes a good distributor?

17th of September 2012

ECJ asks a group of  manufacturers and contract cleaner end users: what defines a good cleaning products distributor, and how have your expectations of distributors changed in recent years?

The view from manufacturers

"We expect the distributor to have a deep knowledge about the local market he is serving and fully understand what challenges his customers are faced with in their everyday business lives. It is important that the distributor is proactive in his market approach and are able to adapt to shifts in demands from the market and are able to communicate these changes back to Nilfisk-Advance so that we can adapt our products and services to these changes fast.

"A good relationship between supplier and distributor is based on frequent communication, an open and constructive dialogue and the ability to benefit from the strength of both parties in the relationship.

Anders Terkildsen, executive vice president, Nilfisk-Advance

"First and foremost a good potential distributor needs to be well introduced into the professional cleaning industry with an organisation that has the ability to service his customers in commercial and technical matters.

"Being in the business, so to speak, is one thing but for us it is vitally important to make certain our product line is complementary to products within the distributor’s existing sales programme.

"Having determined the above, it is necessary to develop a clear understanding of the sales and marketing concept to be sure that the sales route coincides with the distributor’s existing outlets and market segments and further to provide full product training to establish a high level of competence between the distributor and the final customers.

"It goes without saying that prices, terms and margins all play an important part in ensuring the relationship has the potential to be profitable and, consequently, being able to reinvest in growing the business which is an essential element."

Chris Duncan, managing director, Numatic

"A good distributor is hard working, understands its market, finds opportunities, is self-motivated - the next step towards an excellent distributor is to have somebody that offers suggestions to improve your offer, feeding back into the organisation.

"Moving forward, we can see a stronger cooperation between the distributor and the organisation, from manufacturing versus selling into something more of a constant collaboration: including the distributor in the knowledge chain, whereby they become an essential part of marketing/sales research; challenging the organisation whereby they are pushing the company forward with features, quality and price; therefore pushing the company to change their internal processes to match distributors' recommendations.

John Shields, production director, Brightwell Dispensers

"There are several key characteristics that define a good distributor:

•As a basic prerequisite, the demonstration and adherence to high ethical standards is of paramount importance to 3M in ensuring the way in which business is conducted meets the highest levels of ethical behaviour

•Willingness and ability to embrace broader business development activities - eg, functional discounting schemes which encourage mutual business growth, sharing of POS data to enable joint CRM activity aimed at cross-selling and up-selling, campaign management to promote offers

•Healthy financials and ability to pay - the management of NWCT (Net Working Capital Turns) for both manufacturers and suppliers

•Reach and scale - the ability to offer broad solutions to our target markets

•Innovation mindset - willingness to embrace and support new product initiatives

•High calibre sales and marketing organisation - ability to work jointly on training and joint selling initiatives at the local level

"Our expectations of distributors have developed over recently years:

•End user customers are always demanding more value - as they should - and so working together to develop new added value services is desirable

•IT capability - leaner business models which offer great service with lean cost-to-serve models are important."

Max Walker, business manager Europe, 3M

"We continue to need our distributors to be both innovative and proactive within the market. A good understanding of our product range is important - as is having multiple points of sale spanning trade counter to online and direct sales teams.

 "The internet marks the single greatest factor for change over recent years. Its increasing sophistication and importance as a marketing medium and sales channel is being noted and optimised by a growing number of our distributors."

Paul Robinson, UK and international sales manager, Prochem Europe

"Focus and commitment to the line must be the two most important elements of defining a good distributor. Each of these qualities must be supported by a distributor’s clear understanding of the manufacturer’s marketing plan, business strategy and route map of the goals and objectives.

"Clear, precise communication of sales messages are a prerequisite of the manufacturer and a demonstrable understanding of these objectives is a major factor.

"Over recent years the partnership between a good distributor and one that is less successful has been largely influenced by the economic climate, and we believe, by the commitment made from each party. An imbalance between the two leads to frustration and usually one or other, or both, being unhappy through lack of business.

"At Vectair we have worked to gain a greater understanding of the distributor’s market and tried to be empathetic to change by adopting a more flexible approach to business. Our expectations have not changed: in reality, what we have found is that where we had committed partners originally these relationships have flourished and both parties have seen tangible benefits."

Paul Wonnacott, managing director, Vectair Systems

"The distributor is an increasingly sophisticated business partner in line with the needs of the changing cleaning market. It plays a prominent role both in the logistics  - which must be handled in the shortest time -  and in after-sales and training.

"Together with the producer, the distributor shares important goals to respond as quickly as possible to growing market demand for product innovation and constant training on the proper and most efficient procedure for cleaning.

"And in the current economic climate the greatest change we have seen is in payment terms, which have inevitably lengthened ."

Sergio Cervellin, president, IPC Euromop

“We see our distributors as business partners. We’d like to think that they see us in the same light. Certainly the more progressive distributors are constantly pushing us to work more closely with them. There’s more strategic thinking and working together today than in the past.

 “We need them to work with us as equal partners or we can’t achieve everything we’d like to achieve for our business. Increasingly, our distributors are our prime source of end customer insight. They bring the package together for their customers – product aggregation is only a part of what they do for their customers. The name of the game is service. Some of our business partners are now very slick at serving their customers."

Stephen Kerr, regional sales leader UK, Ireland and Benelux, Kimberly-Clark Professional

The view from contract cleaners

"Ultimately, cleaning companies are reliant on janitorial suppliers to keep them abreast of any advancement that may be of benefit. Janitorial supply houses that do not manufacture their own chemicals and hardware are better focused on introducing innovations from all sector manufacturers and not those that will necessarily afford them the best return.

“Just in time stock management is essential for most product suppliers needing to gauge stock levels to satisfy regular orders, but flexibility is critical in ensuring suppliers keep adequate stock levels to be able to satisfy emergency orders.

"Added value is also important. Helping cleaning companies open up opportunities to add to the range of products they supply clients is also critical in times such as these where margins on core cleaning are under significant pressure.

“Online ordering, invoicing and budgetary control helps make ordering and processing more efficient and less reliant on manual processing as well as helping produce meaningful information for budgetary control.”

Jonathan King, joint managing director, Regent Cleaning

"We expect complete accuracy from our distributor, with the right order delivered in full every time. The distributor needs to know what the customer is doing now, next month and in the short, medium and long term. That way they can work with us to understand changing requirements, processes, restrictions on chemicals, new customer/growth, better use of green chemicals if appropriate.

"Product knowledge is essential, as is a 'can-do' attitude. We also appreciate different ordering options, such as website shopping basket, bulk orders, budget control built in and limits on product lines that can be ordered.

"Cost isn’t everything but value is, so pricing needs to be keen but not such that the overall service is adversely affected.

"We also appreciate useful and flexible reporting against products, volumes, dates, customer delivery destinations and any other permutation of information deemed relevant - ideally all managed by the customer through the website."

Paul Sambrook, group commercial director, Servest Multi Service Group

"A good cleaning products distributor should be flexible and able to cope with rapid rises in demand, for example during the Olympics and other sporting events.

"An understanding of green cleaning technology is a must, together with the natural ability to innovate and be proactive with ideas. All too often we have to approach them for innovation whereas the distributors should be ‘bombarding’ us instead. They must combine a service focus with strong relationship management attributes through a one point of contact account manager.

"And they should be willing to really understand our business, to the extent that they become involved in our business development. On larger contracts having the flexibility and trust to deal direct with the supplier (and cut out the ‘middle man - distributor’) is preferred, allowing direct delivery and one-to-one contact with suppliers for training.

Paul Thrupp, director of cleaning, OCS

"The relationship cleaning businesses have with distributors is a working partnership for the future. The choice of distributor can make or break the financial security of a business so it is vital to pick the right one. Whatever is being bought, price is not the only factor. The value of the product is bound up with the end to end services that the distributor provides. As expectations of distributors have risen over the years, the entry level for being deemed a good supplier has gone up too.

"The culture of a distributor is increasingly important. Contractors are looking for a supplier that offers honesty, integrity and credibility, as well as a professional service.

"Cleaning is a people business and the quality of staff that interact with the client is growing in importance. A supplier should offer an account manager, who reports to the client at least quarterly. The account manager should operate a continuous improvement process, including the proper training of all staff that service the account to eliminate problems caused by lack of knowledge. Where problems do arise, it is vital that they are resolved promptly and professionally.

"Financial support is also important to a successful partnership. No one is going to ask their distributor to make a loss on their behalf, but reasonable support for large tender submissions is a key element in the development of the long term partnership. The financial support also means that the distributor should carry sufficient stock to ensure timely deliveries, including emergency cover if and when required. Distributors should also carry adequate insurance cover to manage any risks that their products and services might cause.

"Product knowledge is also important. Clients now expect their distributors to have a deep understanding of the products they sell and offer those products that support the client’s cleaning operation and long term plans. Moreover, the distributor should be the eyes and ears of the contractor when it comes to innovations and new products. Training programmes for both chemical and machinery products should be available where required. The product range should be wide and offer both choice and value. The distributor should be able to offer a one stop shop.

"One area where clients are expecting more from their distributors is that of technological support. Not only must suppliers be able to offer a telephone help desk, including an out of hours service, but they should also provide an online ordering and management system that enables recording against budgets so that performance can be tracked. Accurate data on product usage is essential."

Andrew Large, chief executive, Cleaning and Support Services Association

Read ECJ Distributor Focus supplement here

 

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