Distribution value

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Douglas Neilson, managing director of Photonic Solutions, says distributors must work hard to add value for customers

Despite the current difficult economic climate, online sales will increase substantially this year, as they have done year on year. The resilience of this purchasing channel is a testament to the value and convenience most customers find when shopping online. I was recently asked if a distributor company has a future, given this ongoing dramatic growth in web-based purchasing. The simple answer is ‘yes and no’.

Conventional distribution is most certainly under threat from global purchasing. But, in the photonics market, a distributor is not simply just a re-sale company. The best of them will add value throughout the customer purchasing process and, beyond this, to the supply, installation and long-term maintenance of the products. Many distribution companies will make these claims, but what qualities should customers look for in a distributor?

Customer understanding

The distributor should start by understanding what the customer, needs before even talking about products. If the distributor truly understands what the application requires, then the customer stands a much better chance of getting the product(s) they need – of course, the distributor needs to have the right product! Indeed, linked to this, look for a distributor that represents a solid portfolio of established principals. Principals (and indeed distributors) that have been around for a while are more likely to offer high-quality, well-researched and fit-for-purpose optoelectronics products.

The experience of the individuals working for the distributor also counts for a great deal. While the temptation for the more ruthless operators will be to suggest you purchase the most expensive solution, an experienced team will bring together the application with the most appropriate AND cost-effective technical solution, whether you are a university or an industrial OEM. Finding the most appropriate solution requires deep understanding and knowledge of both products and applications – and comes from many years of experience. This goes a long way to providing that key customer interface for new applications and solutions.

Technical support

One of the most important criteria for continued customer satisfaction is to be able to provide excellent technical support. If you’re confident enough that your product will be ‘fit and forget’, then by all means go for the cheapest distributor you can find. The majority of photonics installations are of a level of complexity that they rely upon technical support – not just at the point of installation, but throughout the lifetime of that installation. And, it is beneficial to deal with a stable company that has a low staff turnover, meaning you won’t have to explain the same things again and again each time you call up. Moreover, a good technical support team will also be able to offer advice on legacy systems not even supplied via that distributor, so ensure there is a level of technical expertise for you to tap into when you need it.

Stock availability

Making the purchase of photonics easier has been a long-held goal of mine. Some distributors will not hold any products in stock, and lead times might be up to 12 weeks or more if they then have to order from their supplier. If you are on a quick turnaround, you should find a distributor that holds a significant number of lines in stock. If you do, you could even have the product in your hands within a day or two of your order – and, referring back to my opening statement, some distributors will even allow you to do this via a web shop.

Cost benefits

Potential customers may perceive a distributor as a middle-man adding cost, but little value, to their purchasing process. Reputable distributors work hard to dispel this myth. By capitalising on volume/order discounts, some are able to consolidate multiple customer orders together to reduce project cost. Similarly, distributors can often afford to buy certain items in bulk, saving costs directly and by having lower import costs. Often, this means a distributor can actually be cheaper than buying direct from a manufacturer, as many of the transit costs are already subsumed.

Effective marketing

Lastly, the visibility of a distributor can be a good indicator of the robustness of their business. A reputable operator will support its partner companies to promote their products effectively in the market place to maximise sales and ultimately revenue for these partner companies. Very often companies tend to reduce marketing spend, especially in a downturn, as they rationalise where money is best spent. I believe that if you hide away, and stop marketing, you stand the risk of losing potential customers to your competitors.

Needless to say, at Photonic Solutions we undertake all of these best practices outlined above, and strive to offer that all important bridge between suppliers and customers – with plenty of added value.