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What's next?
by Richard Vurva
Was it easier to predict the future in the old days? Or is change occurring at such a fast pace today that it’s hard enough just to
keep up with what has happened, let alone find time to strategize about what might
happen next.
I sympathize with distributors who find themselves in a state of befuddlement concerning how electronic commerce is going to change their businesses. Every day, it seems, a new company surfaces, announcing its intention to nibble away at (or take massive bites out of) the distribution industry’s
traditional customer base.
A recent development that caught my attention was the
acquisition by Amazon.com of
Tool Crib of the North, the
specialty tools catalog company based in Grand Forks, N.D. The acquisition served as the cornerstone for Amazon.com’s launch of a new home improvement store that targets not only do-it-yourselfers and hobbyists, but contractors, too.
“We’re not limiting ourselves to the DIYers,” says Eric Broussard, Amazon.com’s general manager
for home improvement. “We’re
targeting both DIYers and the pro segment of the market.”
The company has already more than tripled the selection of tools available in the Tool Crib catalog, which annually mails to more than 9 million customers. It also expanded the Grand Forks
customer service center and stocked more than 3 million
square feet of warehouse space
at seven U.S. distribution centers with hand and power tools,
fasteners, clamps, belt sanders
and other specialty tools.
What market is next for the
giant Internet retailer? Is it
interested in industrial buyers?
“There are a lot of markets that Amazon.com is interested in
entering,” Broussard says. “We will do what our customers want us to do. We feel we’re not limited in terms of selection or distribution.”
Our cover story this issue (A-D goes e)
explains how one group of
distributors is responding to
electronic commerce companies encroaching on their market
share positions. It explains how Affiliated Distributors examined
the distribution industry, then developed a strategy to prepare
its members to do battle in a
marketplace still being defined.
Will the strategy work? Only time will tell.
But in an industry that is often criticized for being slow to
change, it’s exciting to witness
an organization that’s not afraid to redefine itself, if that’s what it is going to take to survive.
This article originally appeared in the
January/February '00 issue of Progressive Distributor magazine. Copyright 2000.
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