Progressive Distributor

What's next?

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Was it easier to predict the future in the old days? Or is change occurring at such a fast pace today that its 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 industrys 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.coms launch of a new home improvement store that targets not only do-it-yourselfers and hobbyists, but contractors, too.

Were not limiting ourselves to the DIYers, says Eric Broussard, Amazon.coms general manager for home improvement. Were 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 were 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, its exciting to witness an organization thats not afraid to redefine itself, if thats what it is going to take to survive.