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Aug. 1, 2003
Determining distributors' most pressing concerns proves difficult at best.What business issues worry distributors these days, or maybe even keep them

Determining distributors' most pressing concerns proves difficult at best.

What business issues worry distributors these days, or maybe even keep them up at night? We posed that question to executives of large electrical distributorships recently, and we got some surprising results.

We asked the distributors to rate a variety of business challenges facing them today, assessing which they thought would have the most impact on their companies in the next two years. Using a scale of 1-10 (1 being of most concern), the respondents evaluated issues ranging from contractor consolidation to tight labor markets. Topics ranged from concerns distributors discuss with Electrical Wholesaling's editors to issues they hear about in reports like NAW/Arthur Andersen's Facing the Forces of Change: Four Trends Reshaping Wholesale Distribution.

In many cases, respondents added their own critical concerns to the list such as "integrity loss by competitors and the electrical industry in general (poor ethics)." K.D. Kennedy, Jr., CEO, Electric Supply Co. of North Carolina, Inc., Raleigh, N.C., had these thoughts for industry colleagues: "Let's encourage the return of morals, good conscience, friendship, ethics and mutual understanding amongst all competitors, customers and vendors."

Overall, what seems to be of most concern to electrical distributors as 2000 looms ahead is slowing economic growth. After toiling through one of the longest expansions in post-World War II history, distributors don't believe their lives will get any easier as business becomes scarcer. Neither would they bet that recession has been eradicated. Next on their list of concerns were tight labor markets and increased marketplace competition.

The surprise was that while the 154 survey respondents did place one issue on top of the list, even that top concern rated only a 5 on a scale of 1-10. There appears to be no particular burning issue among them.

At first glance, the results may lead to consider electrical distributors blase. Or, one might think them "shell-shocked" from so many challenges to deal with, simply tuning out or distancing themselves. One respondent summed it up as, "I don't worry much about the stuff we have no control over." Then there's the difficulty that "this rating is a moving target and can change in short time periods," as another distributor pointed out.

My take on it is this: Distributors have so many challenges facing them today they have to pick their battles carefully. With one respondent's No. 1 concern rating low on the next one's list, they cancelled each other out in our survey. The result was that there appeared to be no single outstanding problem facing electrical distributors today. What did become obvious was that each respondent rated the general discomfort level as high. And for some distributors on some issues, their concern was pretty intense. It's those people who will be moving the industry toward innovative solutions to the problems listed below.

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