Whilst maintaining end-to-end control over manufacturing, sales and marketing, and distribution. The key benefit of going direct is that manufactures can ultimately sell their products at a lower cost and finally be able to compete with the big retail brands. Those who were once allies are now becoming competitors.
As manufacturers become more comfortable with direct selling, the service wholesale distribution becomes increasingly under threat.
#Cut the middleman unity full#
With the added benefit of full control over the supply chain, and full control of the brand experience.
By skipping the step of wholesale distribution, ownership over the buying process revolts back to the manufacturers, whilst saving money that was once spent on the middleman stages. Digital transformation has made the setting up of an online store and the opportunity to work with delivery patterns much more accessible. With the evolution of digital technologies, and in particular the boom of e-commerce, manufactures have been able to regain the power over their supply chain. With a rise in e-commerce, low-priced imports and consumers demand for more, manufacturers are now left questioning how they can compete? With a rising demand for faster delivery and more customised products manufacturers must assess the efficiency of their supply chain.ĭirect selling is set to be a powerful distribution channel. But In recent times, a growth in digital transformation and shift in consumer behaviour has placed the middleman system under threat. In this system manufacturers relied heavily on the wholesale distributors to distribute their goods and ultimately get their merchandise in front of customers. Working upon a pyramid style distribution system, where Manufacturers sell their products to distributors – who then sell on to multiple dealers – who sell on again to an even larger number of end users. With the risk of customers imminent, it’s time to shape up and discover how a revamp in process technology could save their business/industry.Ĭurrent Process – Manufacturers –> Wholesale/Distribution –> Retailers – Consumersįor years, manufacturers, wholesalers/distributors and retailers have worked together as allies in the supply chain. But while the industry toys with the idea of direct consumer selling, it’s time for distributors to get to grips with the potential loss of customers. Manufacturers cutting the need for wholesaler distributors and opting to go direct to consumers, is said to be one of the biggest shake-ups the industry has seen in generations. Is the traditional model of selling goods via wholesale distribution, under pressure? After reading a recent article discussing the potential for manufacturers cutting out the middleman it got us thinking.
Wholesale Distributors need to sort out their technology and processes or risk losing customers forever
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