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What happens when an American, a Turk, an Indian, a Japanese and two German Wholesale Distributors sit down to share dinner? Sounds like the beginning of a joke, but it’s not! Instead, it’s a recent and personal example of the fact that despite significant cultural and geographical differences, the topic of Digital Transformation is top of mind for Wholesale Distributors, regardless of where they may reside in the world.

It’s become quite clear that the traditional model of simply breaking bulk and excelling at great relationships with trading partners, be they suppliers or customers, will no longer be enough for Wholesale Distributors to survive in our Digital Age. Instead, Wholesale Distributors must reimagine their business models, business processes and the way in which they work.

Below, we’ll take a look at three compelling ideas for business model transformation:

Value Added Services Distributor

Distributors have been providing services to customers for many years, largely free of charge. In this new business model, value-added services will create new revenue sources –everything from light manufacturing and kitting, to ad hoc virtual training, to automated tracking of sensors for maintenance, to predicting future demand patterns based on long-term weather forecasts.

Real-Time Distributor

Customers have been “trained” to order in their personal lives: meaning, they expect to be able to order anything and everything and have it within 24 hours. Distributors can meet these new expectations by using drones to monitor job-site conditions or Uber-like drivers to deliver within hours. Predictive analytics can be used to track demand patterns and recommend order items/ quantity. Social media feeds can be incorporated into your sales reps and customers’ apps for immediate feedback.

Infinite Inventory Distributor

Because customers expect to be able to order anything and everything from a single “store” in their personal lives, the same holds true in their business transactions. Distributors can Provide infinite inventory by using 3D printing in-house or at a customer’s location. The art of spot buying can be mastered to provide an infinite catalog of products, yet ensure that the products you provide are of high quality at a price that still ensures profitability for you. Distributors can make full use of the business network to become a “master” distributor, a’ la Amazon or Alibaba.

Whether your organization chooses to fully embrace one of these models, or take a piece of the best from each of them is irrelevant. The point is, change is in the air. And, in order to remain competitive and provide unique customer experiences, change is relevant and very necessary. This fact holds true wherever you may be located in this wonderful world of ours.

Are you ready?


Karen S. Lynch

Global Head of Wholesale Distribution Industry Business Unit SAP

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