Distributors: Give Your Manufacturers a Break

Tuesday, December 11, 2012 8:00:00 AM

Categories: Inventory Management

By Mark Tomalonis
Principal, WarehouseTWO, LLC

Distributors: are you a partner with the manufacturers you represent, or are you a
burden to them? While most manufacturers are willing to do just about anything to
support their distributor network's sales efforts, some demands by distributors cause
extra "pain" in their operations: more work, reduced factory floor efficiency, increased
costs. Distributors can help reduce that pain, and get closer to the ultimate goal of
"favorite distributor", with these simple changes in day-to-day operations:

  • Leverage the inventories available from peer distributors: Before you ask your
    manufacturer to change its factory floor work order schedule for your small quantity
    rush demand, search for the item at WarehouseTWO. Our free level 1 membership
    lets you SEARCH the inventory available for up to ten product lines.

  • Find “hidden” inventory with a BROADCAST REQUEST inquiry: Not all
    participants at WarehouseTWO post their inventory data. Find “hidden” inventory,
    owned by participating distributors but not appearing in a SEARCH result, with
    WarehouseTWO’s BROADCAST REQUEST email inquiry tool.

Manufacturers: you can reduce operational pain too, by embracing inventory sharing
and using tools available at WarehouseTWO. Implement these practices to
reduce workload, improve factory floor efficiency and increase overall sales:

  • Enable 24/7 factory stock checks, via WarehouseTWO: Got finished goods in
    stock, but the only way your distributors know what’s in stock is to call or email you?
    Reduce those phone calls and emails by posting your finished goods inventory data
    to WarehouseTWO. Then direct your distributors to perform their own stock checks
    at WarehouseTWO. Your distributors can do this with a free level 1 membership,
    and we will make your inventory data available only to your authorized distributors.

  • Redirect small quantity demands to your distribution channel: Got a request
    for expedited fabrication of a small quantity? Why set up manufacturing equipment
    to make a small quantity of a rarely sold item, when the item already exists on a
    distributor’s shelf? Before you process a potentially unprofitable work order, ask
    your requesting distributor, “Have you checked WarehouseTWO for this item?”

  • “Buy back instead of make”: Got direct end-customers? If so, then do what your
    distributors do: leverage your distributor network’s finished goods inventory to
    provide better customer service to your direct end-customers. That is, buy a rush
    demand item from one of your distributors to fulfill a direct end-customer’s need.
    Improve your performance to your direct end-customers. Avoid clogging up your
    manufacturing operation with a small quantity work order. Eliminate lots of
    expediting and open order management, too.

About the Author
After a successful career in sales and operations management in the wholesale-distribution industry, Mark Tomalonis is now principal of WarehouseTWO, LLC.  He amuses himself by writing articles, such as this one, to help wholesaler-distributors execute their operations better.  Mark’s articles and tips are published in WarehouseTWO’s monthly e-newsletters.  Click here to subscribe.

About WarehouseTWO
WarehouseTWO, LLC is an independent “inventory-sharing” service created exclusively for durable goods manufacturers and their authorized distributors, and for any group of durable goods “peer” wholesaler-distributors, such as members of a buying/marketing group or cooperative.  To learn how inventory-sharing with WarehouseTWO can help your business, visit the WarehouseTWO website, or email info@warehousetwo.com.