Believe it or not, in the Supplies Industry, being old-school and innovative don’t have to be mutually exclusive.
Just look at Grainger, the Fortune 500 industrial supplies company. It is—and has been for a long time—a partially brick-and-mortar, catalog-driven retail business. Old-school at its core. But it also has a consistent track record of innovation and has adapted early and often to changing technology and consumer preferences.
People in the Supplies Industry who are pushing back against e-commerce and digitization could learn a thing or two from this old-school-yet-innovative company, which saw $11.2 billion in sales last year.
Keep up on current tech and use digital tools to your advantage.
Grainger had a smooth transition from Brick & Mortar sales to e-commerce. Why? Because they didn’t abruptly switch over. Instead, they eased into digital and also quickly created a great online experience to convince first-time online shoppers that online is better. Now they have 70% of their customers online.
Of course, they still have brick-and-mortar stores. But because they knew consumer preferences were changing, they jumped out ahead of the trend and made online shopping available for their customers.
Some customers want to browse online. Others want to walk the aisles of a physical store. Both customers should be able to do what they want, plain and simple. Grainger knows that—and you should, too, though it is as easy said than done. Dilemma is that you are a small business, you cannot sell online below your store price, you have a dedicated customer base, you cannot afford to annoy them by selling cheaper online than in your stores. Online is fierce competition, if you reduce prices blindly, then you sell at loss and also annoy your regular in-store customers. Online pricing depends on various parameters, your competitors pricing to be the core, their inventory, their inventory turnover ratio, frequency of price changes, how much inventory you have overlapping with your competitors, there is a lot to be considered before making a pricing decision and most importantly a bulk decision on pricing does not work, competition is now at SKU level, so you need a modern AI based pricing tool that analyses inventory that deep and auto adjusts prices, which makes more profits, which can think like a human.
More people are ordering online, but you still need to create a personal connection with online customers.
Back in the day, you’d drive around the corner to your local Grainger, Home Depot, or Lowe’s to grab the product you needed. And you probably knew the salesman by name.
Grainger didn’t abandon traditional retail. Instead, it adapted and offered e-commerce options to their customers as well, which nearly 70% have taken advantage of, according to its 2018 fact book.
Consider that many of your retail customers or distributors may want the self-serve option of online ordering, but you don’t have your online presence and in return turn to companies like Grainger or other immediate competitors of yours who shifted to online early.
Any branded eCommerce industry should emulate Grainger’s example.
These days, every scaling business should have an e-commerce strategy.
Don’t be asleep at the wheel and neglect this vital side of business. Otherwise, another company with better digital platforms will steal your customers. Without digitization, your business will quickly fall behind from a customer service and experience perspective.
The market is changing. Stay with the times, or even better, ahead of them.
For many in this industry, digital solutions are an afterthought. But this is a mistake.
Take Walmart, for example, it failed to make a dent in Amazon’s market share. Why? Because, for a long time, e-commerce was a very insignificant part of their business model.
If you just slap together a makeshift e-commerce arm of your company and don’t treat it like a separate business, you’re doing it wrong. You have to invest just as many resources in your e-commerce business as you do in your brick-and-mortar business. Ah, that is a huge cost and it definitely is, but thanks to the e-commerce Market, you have the liberty to outsource most of the functions of your e-commerce store. Starting from an e-commerce store launch, day to day maintenance, adding new inventory, updating inventory, banners creation, sales order management, automated interaction tools with suppliers, retailers, distributors and customers. e-commerce has the beauty that most of it is now possible to be outsourced and that too can be to the low cost countries. Even Grainger’s or Lowe’s have their backend teams working from remote locations.
And you have to overcome your doubts.
People in old-school industries like Tooling, Hardware, Heating & Plumbing are quick to assume, “The market’s not ready for e-commerce.” But you have to plan and act before you think the market is ready. That’s how you succeed and stay ahead of your competition. That’s what Grainger did—and it’s probably in the best interest of your business, too. But how to do it with ease without denting your existing brick and mortar business. Traditional old school Brick and Mortar stores do not have dedicated resources to manage the e-commerce business. An e-commerce store needs a very neat & clean inventory management. In the Brick & Mortar, your sales staff still use quick SKU or MPN searches in your invoicing system. You have experienced sales people who guide a customer buy the right product meant for them, but inversely an online store does not have any sales person. It needs to act as a sales person, so you need to have all the detailed product knowledge embedded in your e-commerce ecosystem, with detailed product attributes, and a complete variety of various product ranges even though everything is not in stock. A very dedicated team is required to manage your online presence, most of the times business entrepreneurs make the mistake of assigning additional responsibility to their current employees to manage the online presence. You have to do it, and do it the right way.
You need a dedicated e-commerce manager for your operations, e-commerce data experts, e-commerce product veterans
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