Issue link: https://www.e-digitaleditions.com/i/919877
6 FEDA News & Views President's Message T he news of Middleby's acquisition of QualServ has created a lot of concern in the channel. Questions loom large about the impact it will have on the traditional model of distribution and how the rest of the manufacturing community will respond. No, it's not consistent with the norms of our channel but it supports the law of perpetual change and creates new opportunities (externally and internally) for every member of FEDA to re-evaluate their go-to- market strategy and consider the role technology and innovation will play in moving the value proposition forward. Now is the time to identify likeminded suppliers that are willing to collaborate and engage in frank conversations about long-term strategic goals. Manufacturers that have acknowledged the value the distributor brings to the channel are critical to the success of FEDA members, just as it is equally important for FEDA members to support those manufacturers. Manufacturers choose to go through the distributor to introduce their products to the market because of the infrastructure, services and support the distributor provides to the end user. In essence, it is best for the customer and it is mutually beneficial, in terms of economics, for the manufacturer. Yes, you can seek a cheaper alternative and eliminate the distributor but you cannot eliminate the work they perform. Distributors and manufacturers that recognize and embrace the opportunity to work in unison to serve the customer can be the next disruptors. Our customers demand the best possible solutions for their individual operational and financial needs and, as distributors, we offer choice and selection. Whether it be brand preference, efficiency-driven, price performance or some other metric they have in mind, our design team, sales force, e-commerce platform or catalog fulfills the role of creating choice for our customers. Granted, consolidation of suppliers has certainly made "single brand" closer to a reality, but we are several years from one brand being able to successfully meet all the needs of a customer. The reality is that there will be more challenges ahead and we need to prepare ourselves for more change, disruption and angst, according to findings by Mike Marks, Tim Horan and Mike Emerson of the Indian River Consulting Group. In their book Working at Cross-Purposes: How Distributors and Manufacturers Can Manage Conf lict Successfully," the trio proposes that the days of win-win for distributors and manufacturers are gone due, in large part, to the fact that the paths to profit and growth for each differs. Gaining ground, they assert, is contingent on mastering two laws. First, is the "Law of Legitimate Cross Purposes." Accepting that channel partners may not always be in lockstep when it comes to what the other party needs to achieve economic success is a critical first step. The challenge is getting over the discomfort of discussing where our paths part. It's much easier to talk about issues where there's alignment. Those parties that begin to have the hard conversations and try to find middle ground sooner rather than later will separate themselves from the pack. It can be done. The second law is the "Law of Perpetual Change." Reflective of the ever- changing economic climate, distributor-manufacturer relationships are always changing. To survive change, distributors and manufacturers not only must learn to identify impending change, they also must learn to work together to manage change by implementing appropriate change initiatives. In other words, that means resisting the urge to work on short-term solutions. On the surface, they may save you from short-term profit hits but, as the book suggests, appeasement is the equivalent of death by 1,000 paper cuts. While it may sound trite, the distributor-manufacturer relationship, much like a marriage, requires some very difficult conversations if it is to endure. My suggestion is that we use the upcoming E&S Industry Summit to continue the dialogue. ■ The Law of Perpetual Change Creates New Opportunities Joe Schmitt PRESIDENT, FEDA President, Rapids Wholesale Equipment jaschmitt@rapidwholesale.com To survive change, distributors and manufacturers must learn to identify impending change.