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Top 200 Distributors Sound Off on AmazonSupply

Most of the respondents who commented said that while AmazonSupply will take some market share, customers will still go first to distributors of electrical supplies for their purchases.

Electrical Wholesaling asked Top 200 survey respondents about the chances of AmazonSupply taking significant market share away from electrical distributors and their responses were mixed. While some executives said AmazonSupply is or will be a big threat to their business, generally speaking, most of the respondents who commented said that while AmazonSupply will take some market share, customers will still go first to distributors of electrical supplies for their purchases.

Rick Kerman, CEO, Steiner Electric Co., Elk Grove Village, Ill., is not taking AmazonSupply lightly. “They are a significant concern,” he says. “We are hopeful the top suppliers realize Amazon does not spec product, (and) only sells it when requested. Distributors provide all the product knowledge, local inventory, technical support and after-hour services and delivery that is more costly and much more valuable to the supplier/distributor relationship. We hope the supplier continues to hold this in high regard.”

Other Top 200 electrical distributors think AmazonSupply may be a tough competitor for commodity items or for distributors that don’t offer a full package of value-added services that their customers want, but that they won’t be much of a factor in switchgear, lighting packages, wire and cable or highly engineered project business. Said Fromm Electric Supply’s Michael Fromm, “Amazon’s fulfillment and pricing models will be a challenge for distributors in all industry segments. In electrical, they may capture commodity business, but complex automation or lighting and control systems design will be difficult.”

Rock Kuchenmeister, president, K/E Electric Supply, Mt. Clemens, Mich., said some of his company’s facilities management and MRO customers are price shopping at AmazonSupply, but they still come back to his company and other electrical distributors to order. “Essentially, the customer searches the internet for products and pricing, instead of seeking information from sales reps,” he said. “Some of these customers are comfortable ordering from the internet sites, others just want the distributor to match the price.”

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