Quality content equals happy customers

In the words of Paul Griffin, vice-president of sales and marketing for Asbis, a $500m-plus international IT distributor of Intel, Seagate, Maxtor and Hitachi products, you have to be ‘something of a masochist who suffers amnesia once a quarter’ to be in channel distribution today. Indeed, distribution in almost all industry sectors is tough, and the internet is exacerbating these pressures. Margins continue to slide to almost unsustainable levels. Asbis, however, has managed to buck the trend for the last three years.

In 2002, Asbis grew its revenues 40 per cent from $380m to $540m , and remained profitable while many others saw their revenues and profitability decline.

‘Part of our success is that we continue to expand into new territories that have been less affected by the economic downturn,’ says Paul Griffin. ‘But a major contributing factor to our success is that three years ago we were forward thinking in embracing e-business and getting the proactive support of our suppliers in implementing our e-business solutions. Today, we are reaping the rewards.’

The problem is that the distribution model is changing fast, and few suppliers and fewer distributors are aware of the acceleration of change. An example is inventory turns.

A few years ago some distributors were content with 15 inventory turns per year. Today they may have to do as many as 25, and it is likely that they may have to do over 50 in three of four years’ time. They can only achieve this if they implement an e-business strategy quickly.

CIO Agenda Volume Two – Content (.PDF, 704KВ)