facing the forces of change survey results segmented by total sales_october 2011

1 © Copyright IBM Corporation 2006

IBM Global Business Services

© 2011 IBM Corporation

Facing the Forces of Change Segmentation by Self-Reported Total SalesSegmentation by Self-Reported Total Sales

$500 millionand above

$250 millionto < $500

million


million

$20 millionto < $50million

Less than$20 million

Online Survey ResultsSegmented by SelfSegmented by Self--Reported Total SalesReported Total Sales

388 total responses







million


million



Guy BlissettWholesale Distribution [email protected](917) 224-9868

Guy BlissettWholesale Distribution [email protected](917) 224-9868

Leading distributors are taking decisive actions and investing toposition themselves for a complex future

Decisive Actions for an Uncertain EconomyDecisive Actions for an Uncertain EconomyLatest iteration ofFacing the Forces of ChangeFacing the Forces of Change®

Available via the N.A.W. website:http://www.naw.org/







million


million



Total Sales segmentations



million


million



Notes:

• Number of respondents to each question varies… see Sample Size figure oneach chart for specifics

• Y-axis scale differs from chart to chart… avoid using visual comparisons

• Each chart is an embedded Excel file

Notes:

• Number of respondents to each question varies… see Sample Size figure oneach chart for specifics

• Y-axis scale differs from chart to chart… avoid using visual comparisons

• Each chart is an embedded Excel file







million


million



Online survey participantTitle

67%

17%

8% 8%

55%

32%

6% 7%

58%

29%

7% 6%

38% 38%

5%

19%

37%

43%

11%9%

0%

10%

20%

30%

40%

50%

60%

70%

Chief Executive Off icer /Chief Operating Off icer /Other C-suite / President

Director / Vice President Regional / Branch / SalesManager

Other (describe incomments box)

Col

umn

%

Less than $20 million $20 milllion to < $50 million $50 million to < $250 million

$250 million to < $500 million $500 million to over $1 billion

Sample Size = 365







million


million



Online survey participantPrimary responsibility

72%

19%

2% 1% 2% 3%0% 1%

75%

15%

0% 0% 1%6%

0%3%

63%

20%

1% 2% 0%

12%

0% 2%

70%

10%5%

10%

0% 0% 0%5%

46%

23%

0%

9%

0% 0%3%

20%

0%

10%

20%

30%

40%

50%

60%

70%

80%

Executive /M anagement

Sales /M arketing /

DemandFulfillment

Custo merService

Supply Chain /Lo gistics

P ro curement Finance /A cco unting

Info rmatio nTechno lo gy

Other(describe inco mments

bo x)

Col

umn

%



Sample Size = 363







million


million



Online survey participantOrganization size (Total Annual Sales)

100%

0% 0% 0% 0% 0%0%

100%

0% 0% 0% 0%0% 0%

100%

0% 0% 0%0% 0% 0%

100%

0% 0%0% 0% 0% 0%

43%

57%

0%

20%

40%

60%

80%

100%

120%

Less than $20million

$20 million to$50 million



$500 million to$1 billion

$1 billion or more

Col

umn

%



Sample Size = 367







million


million



Online survey participantOwnership structure

99%

1%

100%

0%

95%

5%

85%

15%

53%47%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Privately Held Publicly Traded

Col

umn

%



Sample Size = 360







million


million



Online survey participantGeographic sales coverage

25%

37%

18%21%

16%

51%

19%14%

4%

44%41%

10%

0%

30%

45%

25%

0%

9%

42%

48%

0%

10%

20%

30%

40%

50%

60%

Local: We servecustomers w ithin a single,

local geographic market

Regional: We servecustomers w ithin multiplegeographic markets in a

single region of NorthAmerica

Multi-Regional / National:We serve customers inmultiple regions of North

America

Multi-National: We servecustomers both inside

and outside NorthAmerica

Col

umn

%



Sample Size = 355







million


million



Online survey participantOrganization’s majority customer type

28%

34%

7%4%

1% 2% 2%

20%

36%

29%

18%

0%3% 3% 2%

9%

33%31%

24%

0%2% 1% 0%

9%11%

47%

21%

0%

5%

0% 0%

16%

39%

18%

24%

0%3%

0% 0%

15%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

Co ntracto rs Industrialmanufacturing

facilit ies

Retail sto res Co mmercialfacilit ies

Health carepro vider

Independentand chain

restaurants,cafeterias

No n-pro fit andGo vernmentinstitutio ns

Otherwho lesaler-distributo rs

Col

umn

%



Sample Size = 347







million


million



Online survey participantOrganization’s type of sales

48%

39%

14%

40%

46%

15%

56%

34%

11%

41%

29% 29%

63%

30%

7%

0%

10%

20%

30%

40%

50%

60%

70%

General Line Firm: 90% of salesfrom more than f ive lines of trade

Specialty Firm: 90% of sales f romtw o to f ive lines of trade

Limited Firm: 90% of sales f rom asingle line of trade

Col

umn

%



Sample Size = 342







million


million



Online survey participantOrganization’s primary products

20% 19%

5%

15%

21%19%18%

22%

3%

19%

30%

7%

18% 19%

4%

21%

26%

12%

28% 28%

0%

17% 17%

11%

23%

13%

0%

20%

27%

17%

0%

5%

10%

15%

20%

25%

30%

35%

MRO:maintenance,

repair, andoperations of

customer facilities

OEM: Componentsincorporated intoanother product

Equipment: Capitalequipmentproducts

Resale for retail:Finished products

for resale toconsumers

Resale forservice: Finished

products toservice

customer’scustomer

Other (describe incomments box)

Col

umn

%



Sample Size = 340







million


million



35%

46%

19%

38%

52%

10%

37%

53%

10%7%

79%

14%

33%

54%

13%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Our company has no plans to dothis

Our company does this today Our company does not do thistoday, but w ill by 2015

Company Strategy:Sell product and offer fee-based services

Sample Size = 285







million


million



Company Strategy:Services available to customers even if no product is purchased

46% 44%

10%

45%49%

5%

53%

32%

15%21%

64%

14%

54%

42%

4%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%



Sample Size = 278







million


million



Company Strategy:Offer third-party logistics to customers as a fee-based service

65%

23%

12%

62%

25%

13%

60%

27%

13%

29%

43%

29%33%

42%

25%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%



Sample Size = 276







million


million



Company Strategy:Optimize network design (i.e., #, size, location of branches, DCs)

49%

36%

15%

24%

51%

25%27%

55%

19%21%

71%

7%13%

78%

9%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%



Sample Size = 271







million


million



Company Strategy:Outsource warehouse operations to a third-party

89%

10%

1%

89%

9%2%

87%

4%9%

93%

0%7%

86%

9%5%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%



Col

umn

%



Sample Size = 270







million


million



Company Strategy:Outsource additional non-core administrative activities

63%

24%

13%

55%

34%

11%

66%

28%

5%

71%

21%

7%

71%

24%

5%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%



Sample Size = 272







million


million



Company Strategy:Outsource elements of IT infrastructure (e.g., applications, server)

36%

49%

15%

45%40%

15%

47%

32%

20%

36%

50%

14%

55%

36%

9%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%



Sample Size = 272







million


million



Company Strategy:Create and/or grow presence in geographic markets outside U.S.

56%

29%

16%

65%

20%15%

61%

27%

12%

38%

54%

8%

25%

63%

13%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%



Sample Size = 273







million


million



Company Strategy:Stop doing business with highly unprofitable customers

7%

82%

11%9%

70%

21%

8%

71%

21%

7%

79%

14%9%

78%

13%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%



Sample Size = 278







million


million



Company Strategy:Manufacture our own private-label products in an overseas plant

76%

15%9%

75%

15%11%

64%

22%

13%

71%

21%

7%

55%

36%

9%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%



Sample Size = 272







million


million



Company Strategy:Market our own private label products

46%39%

15%

39%46%

14%

33%

49%

17%

29%

50%

21%18%

68%

14%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%



Sample Size = 275







million


million



Company Strategy:Participate in distributor buying group/ marketing alliance

29%

56%

15%

25%

69%

5%

29%

60%

12%

64%

29%

7%

41%

55%

5%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%



Sample Size = 282







million


million



Company Strategy:Create strategy for current and future human capital requirements

24%

48%

28%

13%

55%

33%

10%

70%

19%

7%

86%

7%8%

79%

13%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%



Sample Size = 276







million


million



Factors Impacting - Today:Increased product traceability

49%

23%

29%

48%

34%

17%

45%

29%25%

57%

21% 21%

29%

33%

38%

0%

10%

20%

30%

40%

50%

60%

Less signif icant Moderately signif icant More signif icant

Sample Size = 273







million


million



Factors Impacting - Future:Increased product traceability

36% 35%

30%

38%

25%

37%

30%

38%

32%

50%

33%

17%

26%

21%

53%

0%

10%

20%

30%

40%

50%

60%


Sample Size = 230







million


million



Factors Impacting - Today:Growth of green business segments

25%

48%

27%24%

40%36%

21%

49%

29%29%

57%

14%14%

24%

62%

0%

10%

20%

30%

40%

50%

60%

70%


Col

umn

%



Sample Size = 274







million


million



Factors Impacting - Future:Growth of green business segments

16%

46%

38%

14%

43% 43%

16%

32%

52%

17%

58%

25%

5%

37%

58%

0%

10%

20%

30%

40%

50%

60%


Sample Size = 232







million


million



Factors Impacting - Today:Disintermediation

25% 24%24%

34%

41%

28%

39%

33%

43%

21%

36%

15%

45%

40%

0%

10%

20%

30%

40%

50%


Col

umn

%



Sample Size = 270







million


million



Factors Impacting - Future:Disintermediation

16%

38%

46%

15%

48%

37%

32%35% 33%

25%

33%

42%

11%

58%

32%

0%

10%

20%

30%

40%

50%

60%


Col

umn

%



Sample Size = 231







million


million



Factors Impacting - Today:Private label products

33%

41%

26%

33%

38%

29%28%

40%

32%

43%

14%

43%

15%

40%

45%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%


Col

umn

%Less than $20 million $20 milllion to < $50 million $50 million to < $250 million


Sample Size = 271







million


million



Factors Impacting - Future:Private label products

25%

39%36%

29%31%

40%

24%

41%

35%

25% 25%

50%

5%

42%

53%

0%

10%

20%

30%

40%

50%

60%


Col

umn

%



Sample Size = 231







million


million



Factors Impacting - Today:End customer consolidation

21%

50%

29%

19%

43%

38%

16%

56%

28%

7%

50%

43%

25%

35%

40%

0%

10%

20%

30%

40%

50%

60%


Col

umn

%



Sample Size = 271







million


million



Factors Impacting - Future:End customer consolidation

17%

42% 42%

8%

44%48%

14%

49%

37%

17%

25%

58%

5%

47% 47%

0%

10%

20%

30%

40%

50%

60%


Col

umn

%



Sample Size = 230







million


million



Factors Impacting - Today:Supplier consolidation

21%

50%

29%

12%

55%

33%

16%

57%

27%

14%

50%

36%

19%

43%

38%

0%

10%

20%

30%

40%

50%

60%


Col

umn

%



Sample Size = 272







million


million



Factors Impacting - Future:Supplier consolidation

6%

52%

42%

10%

42%

48%

13%

51%

37%

25% 25%

50%

5%

32%

63%

0%

10%

20%

30%

40%

50%

60%

70%


Col

umn

%



Sample Size = 229







million


million



Factors Impacting - Today:Industry consolidation

14%

41%

46%

10%

45% 45%

15%

45%

40%

14%

43% 43%

15%

40%

45%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%


Col

umn

%



Sample Size = 270







million


million



Factors Impacting - Future:Industry consolidation

6%

37%

57%

4%

52%

44%

5%

44%

51%

0%

42%

58%

5%

26%

68%

0%

10%

20%

30%

40%

50%

60%

70%


Col

umn

%



Sample Size = 230







million


million



Factors Impacting - Today:Overseas competitor expansion

36% 35%

30%33%

41%

26%

43% 42%

15%

58%

25%

17%

37%

47%

16%

0%

10%

20%

30%

40%

50%

60%


Col

umn

%



Sample Size = 267







million


million



Factors Impacting - Future:Overseas competitor expansion

24%

37%39%

23%

52%

25%

37%

41%

22%25%

50%

25%

37%

21%

42%

0%

10%

20%

30%

40%

50%

60%


Col

umn

%



Sample Size = 230







million


million



Factors Impacting - Today:Macro-economic impact of crisis

7%

26%

67%

3%

28%

69%

7%

27%

67%

15%

23%

62%

5%

20%

75%

0%

10%

20%

30%

40%

50%

60%

70%

80%


Col

umn

%



Sample Size = 269







million


million



Factors Impacting - Future:Macro-economic impact of crisis

16%

51%

34%

15%

38%

46%

25%

43%

32%

25%

42%

33%37%

21%

42%

0%

10%

20%

30%

40%

50%

60%


Col

umn

%Less than $20 million $20 milllion to < $50 million $50 million to < $250 million


Sample Size = 229







million


million



Factors Impacting - Today:U.S. economy structural shift

12%

34%

55%

7%

41%

52%

11%

45% 44%

23%

31%

46%

25%

30%

45%

0%

10%

20%

30%

40%

50%

60%


Col

umn

%



Sample Size = 270







million


million



Factors Impacting - Future:U.S. economy structural shift

6%

49%

45%

4%

54%

42%

14%

48%

38%

17%

42% 42%

16%

37%

47%

0%

10%

20%

30%

40%

50%

60%


Col

umn

%



Sample Size = 229







million


million



Factors Impacting - Today:Government regulation

10%

39%

51%

9%

40%

52%

5%

41%

53%

38%

15%

46%

10%

30%

60%

0%

10%

20%

30%

40%

50%

60%


Col

umn

%



Sample Size = 270







million


million



Factors Impacting - Future:Government regulation

6%

34%

60%

8%

29%

63%

6%

32%

62%

8%

42%

50%

5%

32%

63%

0%

10%

20%

30%

40%

50%

60%

70%


Col

umn

%



Sample Size = 229







million


million



Factors Impacting - Today:Product complexity

70%

22%

8%

62%

28%

10%

65%

29%

5%

57%

36%

7%

70%

25%

5%

0%

10%

20%

30%

40%

50%

60%

70%

80%


Col

umn

%



Sample Size = 271







million


million



Factors Impacting - Future:Product Complexity

60%

27%

13%

42%38%

19%

43% 41%

16%

33%

58%

8%

33%

61%

6%

0%

10%

20%

30%

40%

50%

60%

70%


Col

umn

%



Sample Size = 229







million


million



Headcount Today

1,880.482.235.115.95.5Administration /Management

2,081.0154.968.618.57.0Warehouse /Transportation

1,954.189.149.315.27.0Outside sales force

1,933.2374.557.921.17.2Customer service andinside sales force

$500 millionand over




Less than $20millionHeadcount







million


million



Headcount Trend:Customer service and inside sales force

25%

49%

25%26%

42%

32%36%

19%

46%

17%

42% 42%

32% 32%37%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Decreasing Flat Increasing

Sample Size = 231







million


million



Headcount Trend:Outside sales force

24%

36%40%

20%14%

66%

25%29%

46%

8%

50%

42%

28% 28%

44%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


Sample Size = 230







million


million



Headcount Trend:Warehouse / transportation

38%

50%

12%

33%

51%

16%

37% 39%

24%25%

50%

25%26%

53%

21%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


Sample Size = 229







million


million



Headcount Trend:Administration / Management

30%

67%

3%

36%

50%

14%

40% 40%

20%

50%

17%

33%37%

58%

5%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


Sample Size = 231







million


million



Incremental Business Needed…to increase Customer Service & Inside Sales Force

11%

47%42%

25%

58%

17%

34%

52%

13%

33%

58%

8%

47% 47%

5%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

0-10% sales increase 10-25%sales increase Over 25% sales increase

Sample Size = 231







million


million



Incremental Business Needed…… to increase Outside Sales Force

16%

43% 41%

23%

63%

15%

30%

54%

16%

42% 42%

17%

53%

42%

5%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


Sample Size = 231







million


million



Incremental Business Needed…… to increase Warehouse / Transportation

18%

41% 41%

23%

53%

23%

35%

57%

8%

17%

58%

25%

47%53%

0%0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


Sample Size = 228







million


million



Incremental Business Needed…… to increase Administration / Management

5%11%

84%

13%

29%

58%

8%

33%

59%

17%

25%

58%

21%

32%

47%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


Sample Size = 231







million


million



8%

20%

72%

0%

23%

77%

5%

25%

70%

0%

9%

91%

0%5%

95%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Less important Moderately important More important

Col

umn

%



Sample Size = 222

IMPORTANCE:Assessing sales force productivity







million


million



17%

47%

36%

2%

55%

43%

12%

51%

37%

0%

80%

20%

7%

64%

29%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


Col

umn

%



Sample Size = 202

PERFORMANCE:Assessing sales force productivity







million


million



22%

41%37%

9%

38%

53%

15%

36%

49%

0%

36%

64%

11%

32%

58%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


Col

umn

%



Sample Size = 221

IMPORTANCE:Assessing warehouse / transportation personnel productivity







million


million



18%

53%

29%

14%

64%

23%

12%

47%40%

0%

70%

30%

14%

36%

50%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


Col

umn

%



Sample Size = 201

PERFORMANCE:Assessing warehouse / transportation personnel productivity







million


million



7%

33%

60%

2%

32%

66%

2%

34%

64%

0%

36%

64%

5%

26%

68%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


Col

umn

%



Sample Size = 222

IMPORTANCE:Assessing customer service personnel productivity







million


million



14%

58%

27%

5%

61%

34%

9%

61%

30%

20%

70%

10%14%

50%

36%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


Col

umn

%



Sample Size = 202

PERFORMANCE:Assessing customer service personnel productivity







million


million



5%

25%

71%

2%

26%

72%

7%

31%

62%

0%

18%

82%

0%5%

95%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


Col

umn

%



Sample Size = 222

IMPORTANCE:Assessing product profitability







million


million



4%

47% 49%

5%

57%

39%

5%

65%

30%

10%

40%

50%

0%

50% 50%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


Col

umn

%



Sample Size = 201

PERFORMANCE:Assessing product profitability







million


million



22%29%

49%

6%

38%

55%

18%

44%38%

9%

27%

64%

16%

53%

32%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


Col

umn

%



Sample Size = 224

IMPORTANCE:Assessing service offering profitability







million


million



25%

55%

21%18%

57%

25%28%

53%

19%

40% 40%

20%

29%

43%

29%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


Col

umn

%



Sample Size = 202

PERFORMANCE:Assessing service offering profitability







million


million



8%

36%

56%

4%

32%

64%

8%

38%

54%

0%

27%

73%

0%

26%

74%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


Col

umn

%



Sample Size = 224

IMPORTANCE:Assessing customer profitability







million


million



12%

57%

31%

16%

59%

25%

12%

53%

35%

20%

60%

20%14%

57%

29%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


Col

umn

%



Sample Size = 202

PERFORMANCE:Assessing customer profitability







million


million



4%

35%

61%

0%

19%

81%

7%

20%

74%

0%

18%

82%

0%

21%

79%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


Col

umn

%



Sample Size = 223

IMPORTANCE:Optimizing prices







million


million



12%

53%

36%

20%

41% 39%

12%

58%

30%

0%

90%

10%7%

71%

21%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


Col

umn

%



Sample Size = 201

PERFORMANCE:Optimizing prices







million


million



17%23%

61%

2%

21%

77%

5%

21%

74%

0%

18%

82%

0%

32%

68%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


Col

umn

%



Sample Size = 222

IMPORTANCE:Optimizing inventory







million


million



12%

46%42%

9%

50%

41%

9%

53%

39%

20%

50%

30%

7%

36%

57%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


Col

umn

%



Sample Size = 201

PERFORMANCE:Optimizing inventory







million


million



17%

38%

45%

9%

40%

51%

13%

43% 44%

9%

45% 45%

5%

37%

58%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


Col

umn

%



Sample Size = 222

IMPORTANCE:Sensing end product/ service demand







million


million



23%

56%

21%18%

68%

14%

30%

40%

30%30%

50%

20%21%

36%43%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


Col

umn

%



Sample Size = 202

PERFORMANCE:Sensing end product/ service demand







million


million



45%

24%

32%

45%

21%

34%

44%

26%30%

45%

18%

36%32% 32%

37%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


Col

umn

%



Sample Size = 223

IMPORTANCE:Building own brand recognition







million


million



37% 39%

24%

48%

34%

18%

39%

46%

15%

56%

33%

11%

21%

50%

29%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


Col

umn

%



Sample Size = 196

PERFORMANCE:Building own brand recognition







million


million



6%

27%

67%

2%

26%

72%

3%

33%

64%

9%

27%

64%

11%

26%

63%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


Sample Size = 224

IMPORTANCE:Building company brand/name recognition







million


million



12%

60%

29%

2%

45%52%

4%

61%

35%

20%

50%

30%

7%

64%

29%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


Sample Size = 202

PERFORMANCE:Building company brand/name recognition







million


million



9% 6%

85%

4%

18%

78%

14% 15%

71%

18%

0%

82%

25%31%

44%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


Sample Size = 209

Importance to Gross Profit (TODAY):Purchase at a wholesale discount







million


million



12%8%

80%

5%

16%

80%

11% 13%

76%

0% 0%

100%

38%

13%

50%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


Sample Size = 199

Importance to Gross Profit (FUTURE):Purchase at a wholesale discount







million


million



27% 27%

45%

22%18%

60%

22%19%

59%

0%

36%

64%

25%

6%

69%

0%

10%

20%

30%

40%

50%

60%

70%


Sample Size = 208

Importance to Gross Profit (TODAY):Supplier rebates based on total purchases in a time period







million


million



23%

30%

47%

16%

23%

61%

24% 25%

51%

0%

30%

70%

31%

6%

63%

0%

10%

20%

30%

40%

50%

60%

70%


Sample Size = 198

Importance to Gross Profit (FUTURE):Supplier rebates based on total purchases in a time period







million


million



12%

31%

58%

11%

24%

64%

8%

29%

63%

9%

18%

73%

13%

31%

56%

0%

10%

20%

30%

40%

50%

60%

70%

80%


Sample Size = 209

Importance to Gross Profit (TODAY):Supplier discounts based on volume







million


million



16%

23%

61%

7%

23%

70%

13%

25%

62%

0%

30%

70%

6%

25%

69%

0%

10%

20%

30%

40%

50%

60%

70%

80%


Sample Size = 199

Importance to Gross Profit (FUTURE):Supplier discounts based on volume







million


million



32%

42%

26%29%

36% 36%32%

42%

25%27%

9%

64%

13%

56%

31%

0%

10%

20%

30%

40%

50%

60%

70%


Sample Size = 209

Importance to Gross Profit (TODAY):Supplier discounts based on the performance of activities







million


million



20%

34%

46%

23%

30%

48%

25%

40%

35%

20%

30%

50%

19%

31%

50%

0%

10%

20%

30%

40%

50%

60%

70%


Sample Size = 199

Importance to Gross Profit (FUTURE):Supplier discounts based on the performance of activities







million


million



33%

37%

29%

20%

31%

49%

39%36%

25%

18%

36%

45%

31% 31%

38%

0%

10%

20%

30%

40%

50%


Sample Size = 209

Importance to Gross Profit (TODAY):Co-op marketing funds from suppliers







million


million



36%

31% 32%

23%

34%

43%

33%

40%

27%

20%

40% 40%

31% 31%

38%

0%

10%

20%

30%

40%

50%


Sample Size = 199

Importance to Gross Profit (FUTURE):Co-op marketing funds from suppliers







million


million



27%

36% 37%

20%

42%38%

29%

47%

24%18%

55%

27%

6%

75%

19%

0%

10%

20%

30%

40%

50%

60%

70%

80%


Sample Size = 209

Importance to Gross Profit (TODAY):Purchasing extra product in advance of price increase







million


million



26%

36% 38%

27%

39%34%

24%

44%

33%

10%

70%

20%19%

44%

38%

0%

10%

20%

30%

40%

50%

60%

70%

80%


Sample Size = 199

Importance to Gross Profit (FUTURE):Purchasing extra product in advance of price increase







million


million



5%

12%

83%

4%

16%

80%

3%

19%

78%

0%

27%

73%

6%

38%

56%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%


Sample Size = 209

Importance to Gross Profit (TODAY):Product mark-ups to customers







million


million



4%

16%

80%

5%

14%

82%

4%

24%

73%

10% 10%

80%

6%

50%

44%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%


Sample Size = 199

Importance to Gross Profit (FUTURE):\Product mark-ups to customers







million


million



37%41%

22%

38%

42%

20%

56%

29%

15%

45% 45%

9%

44%

31%

25%

0%

10%

20%

30%

40%

50%

60%


Sample Size = 209

Importance to Gross Profit - (TODAY):Fee-for-service payments from customers







million


million



23%

38% 39%

18%

32%

50%

36%35%

29%

10%

60%

30%

44%

25%

31%

0%

10%

20%

30%

40%

50%

60%


Sample Size = 199

Importance to Gross Profit - FUTURE:Fee-for-service payments from customers







million


million



60%

28%

12%

56%

36%

9%

71%

20%

8%

36%

27%

36%

50%

44%

6%

0%

10%

20%

30%

40%

50%

60%

70%

80%


Sample Size = 209

Importance to Gross Profit (TODAY):Fee-for-service payments from suppliers







million


million



41%

34%

25%

30%

50%

20%

51%

35%

15%

40%

10%

50%

38% 38%

25%

0%

10%

20%

30%

40%

50%

60%


Col

umn

%



Sample Size = 198

Importance to Gross Profit (FUTURE):Fee-for-service payments from suppliers







million


million



68%

15% 16%

67%

19%14%

70%

11%

20%

50%

20%

30%

62%

15%

23%

0%

10%

20%

30%

40%

50%

60%

70%

Do not expect 3PL to be acompetitive threat

3PL are a competitive threat today 3PL are not currently a competitivethreat… w ill be by 2015

Col

umn

%



Sample Size = 194

3PL ACTIVITY: Warehousing







million


million



51%

21%

29%

58%

19%23%

70%

11%

20%

67%

0%

33%

46%

31%

23%

0%

10%

20%

30%

40%

50%

60%

70%



Col

umn

%



Sample Size = 194

3PL ACTIVITY : Order fulfillment to Customers







million


million



70%

16%14%

70%

19%

12%

75%

11%15%

56%

0%

44%

54%

23% 23%

0%

10%

20%

30%

40%

50%

60%

70%

80%



Col

umn

%



Sample Size = 193

3PL ACTIVITY : Kitting/Assembling/Packaging







million


million



64%

18% 18%

44%

33%

23%

56%

24%20%

44%

11%

44%

62%

23%

15%

0%

10%

20%

30%

40%

50%

60%

70%



Col

umn

%



Sample Size = 193

3PL ACTIVITY : Transportation







million


million



71%

8%

21%

77%

16%

7%

76%

5%

18%

100%

0% 0%

69%

15% 15%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%



Col

umn

%



Sample Size = 193

3PL ACTIVITY : After-sales service and support







million


million



30%

47%

23%

14%

68%

19%

26%

60%

13%

33%

67%

0%

23%

69%

8%

0%

10%

20%

30%

40%

50%

60%

70%

Our largest supplier has no plansto do this

Our largest supplier does thistoday

Our largest supplier does not dothis now , but w ill by 2015

Col

umn

%



Sample Size = 178

CHANNEL STRATEGY: Work with our company to develop jointservice to sell to end users







million


million



48%

27% 24%

33% 36%31%

45%

36%

19%22%

56%

22%

31%

62%

8%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%




Col

umn

%

Sample Size = 177

CHANNEL STRATEGY : Reduce the number of distributors thatthis supplier sells through







million


million



29%

52%

18%

11%

61%

28%

15%

70%

15%

0%

89%

11%15%

62%

23%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%




Col

umn

%



Sample Size = 176

CHANNEL STRATEGY : Ask our company to share inventoryand/or point of sale information







million


million



36%

52%

12%

25%

64%

11%

28%

60%

11%

0%

89%

11%

23%

69%

8%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%




Col

umn

%



Sample Size = 177

CHANNEL STRATEGY : Market directly to our customers







million


million



55%

36%

9%

42%

31%28%

62%

27%

12%

44%

56%

0%

62%

38%

0%0%

10%

20%

30%

40%

50%

60%

70%




Col

umn

%



Sample Size = 176

CHANNEL STRATEGY : Performs some or all wholesaler-distributor functions themselves







million


million



Estimated % of SalesToday vs. Future

19%14%15%9%19%15%9%4%9%4%Electronic DataInterchange (EDI)

9%14%10%9%20%23%22%24%21%24%Face to face withoutside sales rep

43%46%40%56%43%50%42%52%47%56%Mail, email, phone,and/or fax

6%

20%

8%

Today


15%

25%

8%

Future

16%

13%

6%

Today

$250 million to<$500 million

13%

23%

7%

Future

2%

6%

11%

Today


2%

14%

11%

Future

0%

7%

15%

Today


0%

20%

14%

Future

4%

7%

9%

Today


8%

14%

8%

Future

Other

Online via companyor 3rd party website

Walk-in and countersales







million


million



Estimated % of Sales: online

55%50%50%60%90%High

95%35%34%40%90%High

Mean

Mean

25%23%14%20%14%2015

20%13%6%7%7%Today


$250 million to< $500 million










million


million



48%

32%

21%

31%

50%

19%

60%

35%

6%

56%

33%

11%

36%

45%

18%

0%

10%

20%

30%

40%

50%

60%

70%

Never Majority Majority Today Majority by 2015

Col

umn

%



Sample Size = 171

WAY CUSTOMERS WORK: Require our company to provide newservices without additional margin or fee







million


million



63%

25%

13%

53%

28%

19%

67%

15% 17%

11%

22%

67%

40%

20%

40%

0%

10%

20%

30%

40%

50%

60%

70%


Col

umn

%



Sample Size = 171

WAY CUSTOMERS WORK : Ask for detailed data about theirpurchases from our company







million


million



81%

8%11%

83%

8% 8%

96%

0%4%

89%

0%

11%

82%

0%

18%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


Col

umn

%



Sample Size = 172

WAY CUSTOMERS WORK : Eliminate in-person sales calls from ourcompany’s sales force







million


million



77%

11% 13%

83%

3%

14%

87%

4%10%

89%

0%

11%

82%

9% 9%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%


Col

umn

%



Sample Size = 172

WAY CUSTOMERS WORK : Reduce purchases from us because weare not a preferred supplier







million


million



92%

5% 3%

94%

0%6%

98%

0% 2%

89%

0%

11%

91%

0%

9%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


Col

umn

%



Sample Size = 171

WAY CUSTOMERS WORK : Conduct a reverse auction to selectsuppliers for products from our company







million


million



44%

25%

30%

44%

31%

25%

40%37%

23%22%

56%

22%

36%

45%

18%

0%

10%

20%

30%

40%

50%

60%


Col

umn

%



Sample Size = 171

WAY CUSTOMERS WORK : Centralize purchasing authority forbuyers of our products within their organization







million


million



Way Customers Work:Standardize brands purchased by different buyers within organization

59%

19%22%

53%

25%22%

54%

27%

19%

33% 33% 33%

45%

27% 27%

0%

10%

20%

30%

40%

50%

60%


Col

umn

%



Sample Size = 171







million


million



Method to Generate New Sales (TODAY):Advertising in a printed industry magazine

59%

32%

10%

77%

19%

3%

67%

23%

9%

63%

38%

0%

82%

9% 9%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%


Sample Size = 156







million


million



Method to Generate New Sales (2015):Advertising in a printed industry magazine

72%

22%

7%

77%

19%

3%

83%

12%

5%

50%

38%

13%

90%

0%

10%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%


Sample Size = 150







million


million



Method to Generate New Sales (TODAY):Direct mail solicitation

51%

30%

19%

35%

48%

16%

63%

28%

9%

75%

0%

25%

45%

27% 27%

0%

10%

20%

30%

40%

50%

60%

70%

80%


Sample Size = 156







million


million



Method to Generate New Sales (2015):Direct mail solicitation

62%

30%

8%

58%

39%

3%

68%

22%

10%

38%

50%

13%

70%

10%

20%

0%

10%

20%

30%

40%

50%

60%

70%

80%


Sample Size = 150







million


million



Method to Generate New Sales (TODAY):Fax or other telemarketing

56%

30%

14%

65%

29%

6%

59%

36%

5%

63%

25%

13%

64%

27%

9%

0%

10%

20%

30%

40%

50%

60%

70%

80%


Sample Size = 157







million


million



Method to Generate New Sales (2015):Fax or other telemarketing

50%

42%

8%

68%

23%

10%

66%

29%

5%

50%

38%

13%

70%

10%

20%

0%

10%

20%

30%

40%

50%

60%

70%

80%


Sample Size = 150







million


million



Method to Generate New Sales (TODAY):E-mail marketing

25%

48%

27%26%

52%

23%

49%

33%

19%

25%

38% 38%36%

45%

18%

0%

10%

20%

30%

40%

50%

60%

70%


Sample Size = 156







million


million



Method to Generate New Sales (2015):E-mail marketing

8%

49%

43%

6%

32%

61%

27%

49%

24%

0%

63%

38%

20%

50%

30%

0%

10%

20%

30%

40%

50%

60%

70%


Sample Size = 151







million


million



Method to Generate New Sales (TODAY):In-person sales call

5%

17%

78%

0%

10%

90%

0%

25%

75%

0% 0%

100%

0%

27%

73%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


Sample Size = 157







million


million



Method to Generate New Sales (2015):In-person sales call

3%

28%

68%

6%

29%

65%

0%

44%

56%

0%

50% 50%

0%

50% 50%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%


Sample Size = 150







million


million



Method to Generate New Sales (TODAY):Physical presence at trade show

39%36%

25%

45%

35%

19%

43% 43%

14%13%

63%

25%

0%

82%

18%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%


Sample Size = 158







million


million



Method to Generate New Sales (2015):Physical presence at trade show

40%37%

23%

55%

29%

16%

44%49%

7%

38%

63%

0%

30%

70%

0%0%

10%

20%

30%

40%

50%

60%

70%

80%

90%


Sample Size = 150







million


million



Method to Generate New Sales (TODAY):In-person event or seminar

26%

42%

32%

13%

58%

29%

23%

48%

30%

13%

63%

25%

9%

55%

36%

0%

10%

20%

30%

40%

50%

60%

70%


Sample Size = 156







million


million



Method to Generate New Sales (2015):In-person event or seminar

32%35% 33%

29%

55%

16%

29%

54%

17%

38%

63%

0%

20%

40% 40%

0%

10%

20%

30%

40%

50%

60%

70%


Sample Size = 150







million


million



Method to Generate New Sales (TODAY):Our company’s web site

21%

40% 40%

10%

55%

35%

16%

61%

23%

0%

25%

75%

18%

9%

73%

0%

10%

20%

30%

40%

50%

60%

70%

80%


Sample Size = 157







million


million



Method to Generate New Sales (2015):Our company’s web site

5%

31%

64%

6%

29%

65%

7%

54%

39%

0%

25%

75%

10%

20%

70%

0%

10%

20%

30%

40%

50%

60%

70%

80%


Sample Size = 151







million


million



Method to Generate New Sales (TODAY):Advertising on an industry website

56%

34%

10%

58%

32%

10%

70%

26%

5%

38%

50%

13%

64%

18% 18%

0%

10%

20%

30%

40%

50%

60%

70%


Sample Size = 155







million


million



Method to Generate New Sales (2015):Advertising on an industry website

37%

53%

10%

42%

35%

23%

59%

34%

7%

38%

0%

63%

40% 40%

20%

0%

10%

20%

30%

40%

50%

60%

70%


Sample Size = 150







million


million



Method to Generate New Sales (TODAY):Search engine marketing

29%

42%

29%

42%

29% 29%

42%40%

19%

38%

50%

13%

45% 45%

9%

0%

10%

20%

30%

40%

50%

60%

70%


Sample Size = 155







million


million



Method to Generate New Sales (2015):Search engine marketing

23%

32%

45%

16%

39%

45%

29%

22%

49%

25%

13%

63%

40%

20%

40%

0%

10%

20%

30%

40%

50%

60%

70%


Sample Size = 150







million


million



Method to Generate New Sales (TODAY):Webinars

66%

24%

10%

45%

39%

16%

67%

21%

12%

50% 50%

0%

55%

36%

9%

0%

10%

20%

30%

40%

50%

60%

70%

80%


Sample Size = 155







million


million



Method to Generate New Sales (2015):Webinars

37%40%

23%

29%

35% 35%37% 37%

27%

0%

75%

25%

40%

30% 30%

0%

10%

20%

30%

40%

50%

60%

70%

80%


Sample Size = 150







million


million



Method to Generate New Sales (TODAY):Participate in online networks

68%

24%

8%

65%

19%16%

81%

14%

5%

63%

25%

13%

73%

27%

0%0%

10%

20%

30%

40%

50%

60%

70%

80%

90%


Sample Size = 156







million


million



Method to Generate New Sales (2015):Participate in online networks

36%

42%

22%16%

32%

52%49%

37%

15%13%

63%

25%

40% 40%

20%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%


Sample Size = 149







million


million



Role of Information TechnologyActual

21%27%

16%

34%

2%3%

16%

26%

42%

13%9%

16% 14%

50%

11%

0%

13% 13%

63%

13%

0%

18%

9%

64%

9%

0%

10%

20%

30%

40%

50%

60%

70%

No clearly def inedrole for IT w ithin

organization

Take a conservativeapproach; use only

proven, maturetechnologies

Stay current on IT;w ithout getting toofar ahead of our

competition

IT is an essentialinvestment area;

invest in leading, butproven,

technologies

Use IT as acompetitive w eapon;

compete at thecutting edge of

innovation

Col

umn

%



Sample Size = 156







million


million



Role of Information TechnologyPreferred

5%

11%

23% 21%

40%

0% 0%

19%

52%

29%

0%5%

11%

52%

32%

0% 0% 0%

50% 50%

0% 0%

9%

64%

27%

0%

10%

20%

30%

40%

50%

60%

70%

No clearly def inedrole for IT w ithin

organization

Take a conservativeapproach; use only

proven, maturetechnologies

Stay current on IT;w ithout getting toofar ahead of our

competition

IT is an essentialinvestment area;

invest in leading, butproven,

technologies

Use IT as acompetitive w eapon;

compete at thecutting edge of

innovatio

Col

umn

%



Sample Size = 156







million


million



Software Usage:ERP System

14%

31%

14%

22%19%17%

20% 20%27%

17%

9%

23%

7%

28%33%

0%

13%

0%

13%

75%

10%

0%

10%

70%

10%

0%

10%

20%

30%

40%

50%

60%

70%

80%

Not familiar w ith thissof tw are application

No plans to use thissof tw are application

Not currently using -w ill start using by

2015

Currently using, butw ill need upgrade/

change to meetneeds in 2015

Currently using andfully meets our

needs now and in2015

Col

umn

%



Sample Size = 149







million


million



Software Usage:Warehouse Management System (WMS)

4%

40%

18%

28%

11%

0%

16%

35%32%

16%

0%

23%

9%

26%

42%

0% 0%

25%

13%

63%

0% 0%

20%

40% 40%

0%

10%

20%

30%

40%

50%

60%

70%

80%




2015





Col

umn

%



Sample Size = 149







million


million



Software Usage:Transportation Management System (TMS)

7%

61%

25%

4% 4%3%

39%

29%

19%

10%

0%

37%

19% 16%

28%

0%

50%

25% 25%

0%0%

40%

20% 20% 20%

0%

10%

20%

30%

40%

50%

60%

70%

80%




2015





Col

umn

%



Sample Size = 148







million


million



Software Usage:Customer Relationship Management (CRM)

5% 5%

41%

33%

16%

3%

13%

32%35%

16%

0%

14%

40%

33%

14%

0% 0%

38%

50%

13%10%

0%

50%

30%

10%

0%

10%

20%

30%

40%

50%

60%

70%

80%




2015





Col

umn

%



Sample Size = 150







million


million



Software Usage:Sales Force Automation (SFA)

12%19%

43%

17%

9%10%

26%

39%

13% 13%7%

33%

23% 23%

14%

0%

13%

25%

63%

0%0%

10%

50%

20% 20%

0%

10%

20%

30%

40%

50%

60%

70%

80%




2015





Col

umn

%



Sample Size = 150







million


million



Software Usage:Price Optimization

18% 19%

37%

14% 12%10%16%

58%

13%

3%2%

21%

36%

17%

24%

0%

13% 13%

63%

13%

0% 0%

44% 44%

11%

0%

10%

20%

30%

40%

50%

60%

70%

80%




2015





Col

umn

%



Sample Size = 147







million


million



Software Usage:Internet storefront for web-based ordering

7%

16%

47%

10%

2%

16%

30%

21%

75%

10%

20%

31%

42%

32%

16%

30%

25%

70%

0%

10%

20%

30%

40%

50%

60%

70%

80%

Not familiar with No plans to use Not currently using- will by 2015

Currently using -upgrade needed

by 2015

Currently using -no upgrade needed

Sample Size = 150







million


million



Software Usage:Inventory Management

10%

26%

7%

29% 28%

6%3%

32%35%

23%

0%

12%

19%

33% 36%

13%

0% 0%

25%

63%

10%

0% 0%

50%

40%

0%

10%

20%

30%

40%

50%

60%

70%

80%




2015





Col

umn

%



Sample Size = 149







million


million



Software Usage:Inventory Optimization

25% 23% 25%19%

9%

16%13%

42%

13%16%14% 12%

21%

30%

23%

13%

0% 0%

38%

50%

11% 11%

56%

0%

22%

0%

10%

20%

30%

40%

50%

60%

70%

80%




2015





Col

umn

%



Sample Size = 148







million


million



Software Usage:Vendor Managed Inventory (VMI)

11%

43%

16%21%

9%10%

35%

26%

16%13%

0%

30%

16%

28% 26%

0%

25%

38%

25%

13%10%

0%

30%

40%

20%

0%

10%

20%

30%

40%

50%

60%

70%

80%




2015





Col

umn

%



Sample Size = 148







million


million



Software Usage:Product Catalog Management

18%

40%

28%

7% 7%3%

35%

19%

35%

6%5%

21% 19%

43%

12%

0%

13%

38%

25% 25%

0% 0%

11%

56%

33%

0%

10%

20%

30%

40%

50%

60%

70%

80%




2015





Col

umn

%



Sample Size = 147







million


million



Software Usage:Master Data Management

29%34%

14%18%

5%

23%26%

29%

19%

3%

16%21% 23% 21% 19%

0% 0%

38% 38%

25%

0% 0%

44%

33%

22%

0%

10%

20%

30%

40%

50%

60%

70%

80%




2015





Col

umn

%



Sample Size = 147







million


million



Software Usage:Barcode Scanning

5%

21%

34%

22%17%

0%6%

42%39%

13%

2%

10%

29% 26%

33%

0% 0%

13%

38%

50%

0% 0%

20%

40% 40%

0%

10%

20%

30%

40%

50%

60%

70%

80%




2015





Col

umn

%



Sample Size = 149







million


million



Software Usage:RFID event capture / EPCIS

21%

47%

18%

5%9%

16%19%

52%

13%

0%

14%

36%31%

7%12%

25%

38%

13% 13% 13%

0%

40%

30%

20%

10%

0%

10%

20%

30%

40%

50%

60%

70%

80%




2015





Col

umn

%



Sample Size = 148







million


million



Software Usage:Activity-Based Costing (A-BC)

16%

33%28%

16%

7%10%

32% 32%

19%

6%0%

37%

23% 21% 19%

0%

13%

38% 38%

13%

0%

30%

20%

30%

20%

0%

10%

20%

30%

40%

50%

60%

70%

80%




2015


change to meet needsin 2015

Currently using andfully meets our needs

now and in 2015

Col

umn

%



Sample Size = 149