Confronting the New Economic Environment

Volatility, complexity, and uncertainty are very much top-of-mind for business leaders.

Going forward uncertainty and uneven growth is the new economic reality for business in general.  Debt reduction is now a priority for individuals, businesses, and, we hope,  government.  Volatility, complexity, and uncertainty are very much top-of-mind for business leaders.  Collectively, these factors represent a fundamentally new economic environment that distributors must understand, plan for, and respond to with decisive actions.  Three realities that will continue are:

• Economic shifts will continue.  The overall structure of the U.S. economy continues to undergo deep structural changes.  The shift from "manufacturing led" to "service focused" will continue.
• Competition will intensify.  As a result, it is more important than ever to reinforce existing business relationships and protect revenues with existing customers.  This environment will demand that distributors: sharpen product and service pricing, better understand cost structures and become more efficient.
• Reassess your role in the channel.  Companies should focus on: Collaborating more deeply with customers, assessing their organizations for elements that add value in the channel, and form partnerships with other distributors to leverage individual strengths and effectively deliver differentiating capabilities.

ACTION POINT:  Understand the current realities and plan for and respond to them with decisive actions.