AmazonSupply is Growing Fast -- Will They Leave Small Players Behind?

(We think not -- if small and mid-sized distributors respond quickly and appropriately.)

In an increasingly competitive distribution market, a mega player like Amazon poses a significant threat to small- and mid-sized distribution companies. As you probably know, Amazon has already dominated the consumer market -- and is quickly making progress in the wholesale distribution market through AmazonSupply, its B2B platform. Amazon’s wide reach covers wholesale distribution software battles Amazondistribution sectors such as irrigation, fasteners, janitorial & sanitation, and power transmission. AmazonSupply sales terms (which apply to its more than 500,000 items) include: free two-day shipping for purchases more than $50 going to a single destination; a 365-day return policy; an extensive customer service call center; and lines of credit.

Amazon’s market power stems largely from its incredible ability to take advantage of the Internet and acquired e-commerce experience. Both of these technologies are considered “disruptive technologies,” and they’ve quickly and drastically changed the way that goods are purchased. Like a savvy large-scale corporation, Amazon has seen a way to leverage its strengths to enter the distribution market, and is reaping the benefits from its advanced e-commerce platform while slower, smaller players fall behind.

 Just because your distribution company isn’t Amazon-sized doesn’t mean it can’t take advantage of disruptive technologies, too. By investing in distribution software that allows you to serve customers like a large market player -- and by playing to your natural strengths as a small market player -- you can find success in these technologically changing times.

Enter the e-commerce arena. If you haven’t already set up an e-commerce platform to sell your products, do so ASAP. The list of reasons why e-commerce makes sense for any small- to mid-sized distributor is too lengthy to illustrate here – so for an exhaustive list and some tactical ideas, download “How to Survive as a Distributor in the Digital Age”.

Boost your online presence. As more and more business to business (B2B) purchases take place over the Internet, your company needs to fight for search engines’ attention. Implement an SEO (search engine optimization) strategy that includes proper meta-tagging, keyword choice, and image tagging. Produce fresh content regularly through a company blog and through social media to ensure your online presence is strong and spans across multiple channels. Make sure your e-commerce interface is modern-looking: an antiquated appearance is a turn-off to visiting browsers and new potential customers.

Retain customers through good customer service and intelligent CRM distribution software. Recent estimates suggest that more than 60% of B2B buyers have purchased at least once from AmazonSupply -- meaning AmazonSupply already has valuable data on the majority of B2B buyers – some of whom are your own customers. Invest in smart wholesale distribution software that manages your consumers’ contact information, purchase history, and preferences, so that you can cater to their needs and segment them into logical groups. Even if you don’t feel you need advanced software features now, invest in quality software for the future -- as your company and client base grow, your customer relationships will become more complex. If you find ERP software you like that does not have stellar CRM, don’t throw the baby out with the bath water. Simply ‘link to’ a 3rd party CRM program of your choice.

Provide efficient service through intelligent ERP distribution software. describe the imageB2B customers’ top priorities, in order of importance, include: availability, on-time delivery, one-stop shopping, technical support, and price. Distribution-specific ERP software allows you to satisfy customers’ needs by ensuring that orders are processed quickly, delivered efficiently, and supported extensively. Note that trends change quickly -- so make sure your software is built on an adaptable, open framework. Though your company might not need complex features now (such as the ability to manage transactions in multiple currencies), it could in the future.

Take advantage of your small size. Though mega players like AmazonSupply do have extensive customer support systems, an Amazon customer service representative likely doesn’t have the extensive industry knowledge that you or your employees do. Show clients the value of your specific industry expertise, and give them individualized, personal attention. A small-sized distribution company can deliver more flexible, personal, and specific customer care than a large-scale company -- which can help make your company stand out in a customer’s eyes.