It has been a few weeks of extreme highs and lows among manufacturers and distributors. What we have experienced as a Tech Solutions partner to companies across the US has been unprecedented. Plans to expand product catalogs or tie in multiple website management under one umbrella with tiered pricing have been accelerated by companies in many industries. The recognition that work from home is here to stay has increased reliance on planning, service and documentation automation. Now what we planned on accomplishing in a quarter has now been completed in less than 30 days in order to meet the demand and give manufacturers the opportunity to leverage their inventory and open to new market demands.
What we have heard across industries:
“Right now, this virus has turned our market upside down. If you are open and have inventory, people are buying it.”
“Pricing will face strong headwinds as value propositions for face-to-face service becomes rare. Manufacturers optimized for cost to serve will do better than those that don’t understand true SKU profitability. We see tremendous opportunity to take costs out of inefficient quoting and purchasing.”
“We are seeing suppliers shut down or increase lead times.”
“High pressure on lower pricing to customers. Many customers asking for extended terms during these times.”
“Gross margin is taking a hit due to pricing pressures from competition trying to keep money flowing through.”
“Right now, our word as manufacturers that have consistently delivered is being tried. We have added production while trying to keep social distancing with our people. We need tech support badly.”
“We’re shifting production from producing for oil and gas to producing for retail. Same product, different look, different packaging, different volume. Were we planning this expense, this change in our business model? No, but we are adapting to keep going.”
Everyone is feeling the pressure. Manufacturers are not only having to be as efficient as possible in production, but their pricing and product offering has to be as refined and as profitable as possible. What B2C companies used as buyer persona, manufacturers are having to implement in order to provide best pricing to their larger volume and long term customers vs smaller or newer clients.
The decision to also go straight to retail while maintaining their wholesale business clients has added another technological twist to how fast can we help them with a radically improving B2B commerce through e-commerce product databases, image databases and catalogs online. We do this using products like product information management system (PIM) plus strong commerce solutions like Magento or Sana.
Shopping cart and commerce solutions are not enough to handle the # of SKU’s, variations, kits and technical information to sell online – but we’ve cracked the code with successful implementations for distributors in multiple industries and even helping manufacturers use tools to see the whole supply. We work Supply to Sales. Only with this viewpoint can remarkable change be implemented fast AND effectively.
Respondents expect there will be some companies that do not survive the COVID-19 crisis. “Manufacturers, suppliers, retail customers and competitors will be impacted, putting strain on cash and ultimately, some will go out of business,” said one. The prediction is that while some businesses were already weak, others will be slow to react or will adjust their value propositions late.
“This is definitely the new normal. More online business, in both wholesale and retail, what was negotiated in person in B2B sales in the manufacturing and distribution arenas can and have been done online,” states Rob Neumann, Chief Strategy and Marketing for CSS Commerce. “To what degree of excellence? It will depend on the company and the people. We are moving as fast as we can to get the manufacturer’s staff trained, which is in most cases, reduced, to manage inventory, pricing and product offerings.”
How each manufacturer adapts will determine their future.
CSS Commerce LLC is a leading, global innovator building complex e-commerce software with PIM/DAM/MDM solutions. Experts with Perfion, Magento, Sana, Akeneo and Pimcore. We build both Microsoft enterprise class and PHP open source software solutions. Our global strategic partnerships complete our offerings with business process automation, AI, RPA, Quality management and supply chain software. We provide incredibly productive solutions around Web2Print and PWA. Companies like Bonitasoft, Magento, Sana, BigCommerce, Shopify, SalesForce, Akeneo, AWS, Web2Print, Progressive Web Apps, and select others.