It wasn’t so many years ago that the talk around the industry was if you were a distributor your days were numbered. The entire species was supposed to go extinct before too much longer. Well, if you attended the 2011 NAFCD convention in Nashville you know the news of the sector’s demise was a gross exaggeration.
Yes the ranks at the convention were off somewhat and have been diminishing over the past several years. That however doesn’t really accurately reflect the health of the sector. There has indeed been a reduction in the number of viable distributors, but that has been due more to mergers than by attrition. The distributor members I talked with had indeed trimmed their sail like all industry companies, reducing staff, the number of branches and their inventory levels, but they told me they had never taken their eye off the ball – offering service and value to their retail customers and concentrating their efforts with suppliers who have come through with new products, enhanced programs and added support.
Let me also mention one of the seminars at this outing. It was really more a seminar/standup routine courtesy of the always entertaining Jon Trivers. Trivers talked about new and existing distributor opportunities in the marketplace, and offered a host of locally generated ideas on how these wholesalers can get closer to their retailer customers and in the process generate more consumer sales.
He started with what I would call some directional suggestions, pointing out where the best action is by end-user markets in this new, weaker economy (residential replacement, builder, Main Street and others). He also talked about setting priorities from a product category standpoint, calling attention to how product groups have shifted during these tough economic times. He touched on several opportunities that have also presented themselves by the passing of some of the nation’s major retailer players and how market share has shifted among retail segments.
The guts of the seminar came in the form of ideas distributors can use to bump up business, by offering their retailers ideas that rely on the strength of local needs, launching programs and promotions that offer tailored sales-generating ideas. These ideas ranged from forming loyalty programs, arranging special inventory sales or other special sales, private-label programs with easy to print retailer tags and signage, and even initiating a national distributor-networking insurance program.
This convention was a combined affair bringing together the annual the events of not only the NAFCD but the North American Building Material Distribution Association (NBMDA), an association of distributors of specialty building products and woodworking materials. Because the groups share many of the same challenges and needs, they fit logically together and the critical mass they created made for a much bigger and better convention. This was evident in the event’s exceptional line-up of speakers including Dr. Barry Asmus, author and senior economist with the National Center for Policy Analysis; and Stuart Varney, host of Varney & Company at Fox News. Both proved extremely popular.
Winners at the year’s convention: Michelle Miller, NAFCD’s executive vp, as well as the people who put this whole affair together, and of course the best of the nation’s floor covering distributors. These important players have survived this trying economic cycle by relying on their creativity, which has put them in a very good position, poised for a return to better and stronger times. The real bottom line is that the sector as a whole is sharper and in this global economy is facing even more opportunities that it did when the naysayer predicted their doom just less than two decades ago. Of course that makes me wonder where these wet blankets are now, and what they are investing in so we all know what to stay away from.