Contractors depend on distributors for myriad materials and supplies. But as construction projects become increasingly complex, progressive distributors offer more than shelves stocked with products.
“Contractors today need their distributors to be providers of solutions that help reduce the overall cost of doing business,” said Arnold R. Kelly, Graybar director of construction.
To get the most from distributors, contractors must be aware of all the ways they can be of service; maintain open, two-way communications with distributor personnel; appraise value-added services; and take advantage of those that fit their needs.
Value-added solutions come in many forms, including keeping contractors updated about product developments and training employees in their use, consulting, assisting with bid preparation and design services, accessing product information, placing and tracking orders and shipments, and accessing records and other information over the Internet.
Many distributors provide 24/7 service, and some offer financing and leasing. And logistic support from distributors has become one of the most valuable and frequently used value-added distributor services.
“As an expert in material management,” said Kelly, “Graybar in a prime position to help contractors address an area that can consume up to 45 percent of their labor on a project. Efficiencies gained in better material management will directly affect a contracting company’s bottom line and enable it to better compete in the marketplace. Logistical support also enables contractors to focus on their core competencies.”
Kelly said many value-added services have become more technology-oriented as newer solutions are available via EDI, Web sites, e-mail and other sources that improve operational efficiencies.
“Distributors, contractors, suppliers and others are using technology to improve collaboration and drive costs through the entire supply chain,” he said.
Distributors primary support areas are product knowledge, continuing education, logistics and flexible credit terms, said Stephen Matthew Chew, director of business support for Accu-Tech.
“Product knowledge is crucial in providing customers with the correct solutions,” said Chew. “This entails understanding the current standards as well as how products function as solutions. Distribution-sales representatives know what peripheral components to recommend as well as what products can be substituted.”
Distributors provide valuable information about new technologies, upgrades and product mix, he added.
“In recent years, supplier-sponsored Web-based home training has become available. We make our customers aware of all these options and sponsor training. As technology advances, online access will continue to grow, providing pertinent account, product and standards knowledge,” Chew said, adding that some distributors offer flexible, tailored credit that enables contractors to bid on projects beyond their normal financial capabilities.
Value-added services have evolved from keeping product in stock and preparing it to contractor specs to providing customer inventory programs, logistics and deployment services and developing and implementing e-business services and financial programs, said Greg Hansen, Anixter marketing business manager.
According to Hansen: “Our customers benefit from working with a consultative sales force, a warehouse team that’s used to shipping over 7,000 orders a day, an IT staff that knows how to build applications electrical contractors use, and a technical staff, which has detailed knowledge of the products and technologies that electrical contractors use every day.”
Not all customers take advantage of added-value services. Hansen said the most underused include product and technical expertise of salespeople, multisite rollout services, integrated supply, technological capabilities and supply chain solutions.
Steve Bellwoar, president, Colonial Electrical Supply, said in the past five years distributors have added more high-tech services.
“We have brought many services online for customers’ convenience,” he said. “Through a password-protected Web page, customers can view signed delivery receipts, invoices, statements and even product availability. It is easier than ever to track shipments over the Web. Also, electronic payment is now available.
“We help customers from project inception through completion. Specialists can help customers to better understand the scope, specifications and lead times on equipment. Our lighting and switch-gear departments often identify contradictory and unusual specifications that may lead to bidding errors. Design services, which can minimize engineering costs on any size project. Also, distributors know the problems with lead times on various items. This tends to change depending on raw material availability. Commodity prices also can drive a project one way or another.”
Bellwoar also emphasized product knowledge and education.
“Every day electrical vendors are coming out with new products designed to save labor or help meet new code changes,” he said. “Good distributors provide seminars for contractors identifying new products and explaining code changes. Many distributors have dedicated project management people who work hand in hand with contractor project managers to prevent and solve glitches that may occur. Also, if a vendor is having trouble shipping, the distributor can forewarn the contractor, and perhaps an alternative solution can be found.” EC
GRIFFIN, a construction and tools writer from Oklahoma City, can be reached at 405.748.5256 or firstname.lastname@example.org.