3 Best Practices for Distributors to Increase Sales, Profit & Customer Retention

August 28, 2020 Richard Blatcher

PROS was proud to sponsor the exclusive Margin & Pricing Pre-Conference Workshop at the MDM Sales GPS Conference on August 31st. During this workshop, Bill Dudziak, PROS Lead Strategic Consultant, and John Gunderson, MDM’s VP of Analytics & E-Business, shared practical, simple programs for distributors to improve manual, contract, and system pricing. Highlights and resources from the workshop are outlined below.
 

Distributors are Facing Intense Pressures on Margin and Profitability

In March, COVID-19 changed the rules of the game for distributors – almost overnight.

Many distributors were not prepared, and since then, change has continued to accelerate drastically. In fact, in a survey of 71 B2B buyers who are responsible for purchasing from distributors, Hanover Research found that only three out of ten buyers said most of their vendors were well-prepared. Those buyers also reported that their top challenges of working with distributors are inconsistent and highly variable pricing, slow and inefficient responses, and non-competitive or market-relevant pricing. The study also found that seven out of ten distribution buyers are shifting their wallet share.

This is putting tremendous pressure on distributors — particularly around margin and profitability.

For those reasons and more, PROS and MDM hosted a margin and pricing workshop, highlighting three techniques for distributors to implement: Fight the Fives, The Power of 1%, and Kill the Zero. These three practices for distributors are proven to improve margin and build a culture of getting paid for value.
 

About Fight the Fives, The Power of 1%, and Kill the Zero

Fight the Fives

Too many associates take the natural and easy way to price on the “5s” – 15%, 20%, 25%… – and give away too much margin. Fight the Fives teaches distributors how to check this corrosive manual behavior and help your team get immediate results with small, incremental improvements. Listen to John Gunderson explain “Fight the Fives” in this video. 👇

The Power of 1%

A one-percent improvement to a six-percent EBITDA business has a 15-percent impact! Common sense, but too often it’s easy for associates to slot into behavior that adds up to a big impact. The Power of 1% gives you the tools and content to get your team fighting for every bit of the bottom line. In this short video, John Gunderson discusses “The Power of 1%”. 👇
 

Kill the Zero

Kill the Zero is about getting your teams to live on the right side of the decimal point to deliver small 30-40bps gains for all system, contract and eventually, manual pricing. To tell you more about this program, here’s John Gunderson. 👇
 


Continue the Conversation
If you missed the Margin & Pricing Pre-Conference Workshop or are interested in learning more, we invite you to set up a complimentary consultation with PROS Distribution Expert Advisor and Lead Strategic Consultant, Bill Dudziak. At no cost for you, Bill can share his presentation from the workshop and help you think through applying these simple and effective concepts within your organization.

Schedule Now

For those that attended or registered for the workshop, it is available on-demand within the Engagez platform, with your login in credentials.

About the MDM & PROS Partnership
PROS is a proud partner of Modern Distribution Management. Together, we create relevant, leading, and helpful content for wholesale distributors to succeed in an ever-changing world. Learn more about how we drive top-line growth together in this growing collection of videos, webinars, white papers and blogs.

About the Author

Richard Blatcher

Richard Blatcher, Director, Industry Marketing & Business Intelligence at PROS, manages the global go-to-market strategy for PROS in its strategic industries. He has over 30 years’ experience in the industry originally based in Europe moving to the US in 2010. He spent the first part of his career in media, publishing and direct marketing managing the delivery of marketing and sales enablement services to many manufacturing and distribution blue-chip enterprises. He has also held EMEA and Global Marketing roles for $2Bn+ software company Autodesk including being responsible for launches of market disrupting SaaS software solutions into the market.

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