Around the Horn in Wholesale Distribution - Episode #166

Sam.

All right. Welcome back. That's all I got. That's all you got?

That's all I got today. All right.

Well, welcome back. After a week off.

Yeah, it was.

Yeah. It's just funny you just said that. I was sending a couple emails last night and.

They'Re related to calls that were early last week, but it seems like, like the holiday weekend was like three weeks ago. The way that this week has just gone. I don't know about you, it just seems like time is what, what just happened.

Yeah. Yeah. Well, it's going to get worse, I think before, between now and the end of the year. We're going to be sitting here on the 5th of January or whatever it is sooner than you want.

Well, I just want a few days. I can just sleep.

Okay.

Just sleep through, through a few days, you know. And would it be hibernate, I think is the word I'm looking for. I want to hibernate for a couple of days. So I, I, I told Darlene a while back, I said if I ever retire, my, my plan is we have a spot that we've vacationed at a few times in the South Pacific. And I said, I want to go to that little island and I want to take sleep aids for two days. He said, I want to go, go there two days before you and just sleep and take another Tylenol PM or something every time I wake up and just sleep, sleep for a couple of days. And she laughed at me and she said, you can do that. But she goes, I don't need your help to have fun on that island. So I'll be there with you.

You're not going early so you can, you can sleep and she'll go have fun.

As always, she has a plan. So. Yep. Sorry.

What do we have on the agenda today?

We've got a bunch of stuff to talk to but the exciting stuff we'll look at real quick before we go in is a couple of piece economic news today. But as always we're going to talk about some economy things. It's rare that we get through a discussion without talking a little bit about tariffs but we'll do a little bit about AI some E commerce stuff that's kind of interesting going on a little bit additional. Got some good data out there from our friends at Modern Distribution Management. In fact, we've got Mike Hockett who I think might be joining us this morning just as a, as a listener, but Mike from MDM is trying to remember Mike's title now. It's like Senior executive.

Editor. But there's like three other really, really important pieces of that title. But Mike's going to join us next week and as a guest on the show.

Okay, I didn't know that.

He'll be with us live. We've got.

Jason Hein coming up. We've got Brian Beck, I think is going to join us. A couple of E Commerce thought leaders out there and a handful of additional ones. And the new year is going to be packed full. We've got some additional people joining our staff that are going to be managing it a little bit better than I do of getting our guests together. So that will be a real positive thing. And then I'm working on something really exciting right now. I don't know exactly how we're going to do it yet, but I'm probably going to let the cat out of the bag. But it'll make me commit to working with you to get it done. Is I'm working with John Taylor, our editor producer of the show, to take our transcripts and we're going to use some fancy AI tools ourselves and I think do something like a yearbook of what, what the year, what we talked about this year and how things came together and what did we see as trends and so forth.

And so, so is he able to do that with video or is it just the transcript?

The transcripts. We'll use it all from the transcript. Yeah, so. But there's a lot of discussion left. But I figured if I talk about it on the show, it'll probably make sure it happens.

You know, we could take all the YouTubes and put them in notebook LM and then have it create like a 20 minute podcast summary of the whole year.

Well, that was another thing John brought up too. So. But yeah, so it's in. What's interesting is, you know, I just was talking to a good friend and friend of the show as well. Scott Leith was talking to me about this a while back and Scott's with us pretty regularly in comments and we did a phone call a couple weeks ago and Scott was mentioning some folks that he had talked to that had used from kind of traditional podcast standpoint that they had.

Taken their podcasts and turned them into a book. So I thought that was pretty cool. So anyways, good discussion.

The book would be pretty sad. This book would be pretty sad, you.

Know, well, it's, you know, it's. I think for us that's why I was thinking about the year yearbook, kind of a yearbook style of something that.

Would be interesting to see the progression, basically we Back to the same.

Yeah.

You know, hey, before we, we jump into the newsletter, there were some new economic.

Yeah, let's do that. Let's talk about that real quick. We had a little, a few announcements this morning. Right.

Yeah. So in case you haven't heard, they released the September inflation report. So the core, I'm sorry, the core PCE was at 2.8% expected, 2.9. So slightly down.

Year over year, 2.9%. And personal spending was up a bit over expected and consumer sentiment was up 53.3 over a 4.52percent or 52 rating expected. So that all this is all delayed stuff that is all trickling in after the shutdown. Right after the shutdown. And it's the last really economic data that they're obviously going to have before the meetings next week, which basically makes the rate cut a foregone conclusion. Next week.

Tuesday, Wednesday, I think is the meeting.

Yeah, yeah.

So we got a little rosy rose colored glasses, I guess a little bit this morning then.

Yeah, I mean the market liked it. It jumped quite a bit. It kind of leveled out a little bit. I'm not sure. I haven't really dug in to understand what the market, I mean it's not as up as much as I thought because to me that was kind of a very. I don't know if you could have asked for much better from a standpoint of driving rate cuts. Yeah. Economics and so forth.

NASDAQ and the New York Composite Exchange are kind of flat right now.

Yeah, no, it hasn't done much.

So let me just look at this.

Yeah, had a, had a big, big spike early in the morning and then dropped back down. So pretty flat right now. But that's okay. Yeah, we had some, some less than stellar days as well in the last few weeks. So that's, that's beneficial and helpful to that. So I think it's.

You know, we talk so much, Tom, about consistently on the show about just that, the vacillating, the ups and the downs, the ups and the downs, the ups and the downs through all of this. And it's just kind of interesting to watch and to see. This is kind of more of the same. It looks like we're just on a. I think we've talked about it before. I'm trying to remember what your, what your thoughts were.

You know, we need this yearbook so we can go back and. Yeah, we said for. See how right or wrong.

There we go. Well, John will be listening to this shortly. So John, let's Put our heads together and figure out the best methodologies. We'll probably do a couple of things. I really like your idea about, you know, we talk about AI all the time, right. And it's with Google's Notebook LM tool we can put a lot, load a lot of video and stuff into that as well to make some of those things happen. So that's great. And so, but I think we were talking about earlier in the year about.

What you're trying to remember what your thoughts were but you can just share them again is, you know, kind of where do we hit as the things balance out, right. We'll get, hopefully interest rates continue to drop. I don't think we're going to see, you know, 2.5% mortgages again anytime in the future. But you know, where, where could we kind of get to? I think yesterday the mortgage rates were the best. Mortgage rates out there were like 6.2% or something like that. I do feel like we're going to just on this kind of gradual slide back to the fours.

And. But what's interesting is that, you know, the Fed rate versus mortgage rates are not correlating like they have in the past either right now.

Well, I think they're correlating. I just. They're not, they're not. They're just still higher.

Yeah, well, maybe the spreads are the same. Right?

The spreads are the same, they're just higher. Right. But we're going to get a cut.

I want them lower. I need to take some money out of my house to do something.

I know that I can, I can see, I can hear you like just.

You can hear that resonate. You know what my needs are resonating.

Across is like, damn it, get these mortgage rates lower.

That's right, that's right. Come on fellas, let's go. Let's do 1.25.

I don't think you're going to see that. So I think if you're in the fours to upper fours and, and fives is about as good as you're gonna get for a while. And so, you know, I think you just better jump on it.

What's the number you think I should trigger at?

What's it now?

6.2.

6.2. Yeah, I'm 5.

That's, I mean we shouldn't say that. That's on a 30 year new loan.

Yeah, that's okay. What about a refinance?

They're up sevens seven.

Oh, there's that high. Okay.

I mean I haven't looked closely at that I was just looking at the, the mortgage rates yesterday. Okay, but don't want to, don't want a new one. Don't want to start over with interest rates or interest payments on that.

But anybody's listening as a mortgage broker and they have a good.

Don't say something like that.

Why?

I thought you were going to say have them call Kevin.

Yeah, no, I said reach out. Give Kevin a deal. Right. Find a deal.

Only reach out if you can get me in the forest.

All right, get them in the forest. We'll see. That'll be probably a very short list.

Do you, if you could look at the stack of, on the desk next to me, I'm at my home office where we do the show from. But the stack of things from mortgage brokers and, and lenders right now and just, you know, you, you, you look at one thing online and then boom, the emails flood and the, the, the mail marketing occurs.

Yeah.

Yeah. All right. So, but anyway, so some good news popping up this morning.

We're going to talk a little bit about some of the lingering tariff considerations and so forth. I wish as I think we'll have a really exciting discussion coming up, hopefully January, February about what the Supreme Court comes back with on tariffs, which will be good. So, but let's, let's kind of jump into, into the newsletter for today. And the first article we had was from Mohamed Al Rain, who's pretty, pretty much almost regular, almost weekly on.

CNBC and other shows and so forth. And he posts to LinkedIn each month and does kind of a, actually weekly, I should say does a weekly recap on global economies and markets just to show the standpoint of the credibility of this gentleman. He was worked, has done work with the Fed. He's senior economist, I think right now at a, I want to say it's Oxford University.

Was worked with Pimco and a number of other bond funds and investment groups and so forth over the years. I really like his style. It's just very straightforward. If you get a chance to see him ever on as an example on cnbc, he's, he can be contrarian as well and gets those guys a little riled up on CNBC sometimes. He also subscribes, though, to my theory, which is maybe why I like him, that our inflation rate is probably the wrong number and he was, you have a number, it's closer to three versus trying to get to two.

Yeah.

So it just, it, I mean, obviously, look, as I joke about all the time. Right.

We just, you know, we need big hairy audacious goals. Right. So put the 2% out there and work towards it.

Well, it's, I think, I think, I think the challenge with, you know, what he's talking about and is it goes along with.

It goes along with my thinking, but just with real economic facts and backing, be from somebody who really is a, an economist versus somebody who pretends to understand this stuff in depth on Friday mornings. But I think he goes along with the point of the idea that says, look, we're in a different world. And then we were. There's a lot of other factors. There's live data that we have, there's other things we can be looking at, and there's a lot of other factors that play into this and we can get to the same stability that we're looking for in the economy without having to just use. And I don't say antiquated, but it's nearly antiquated data. And you know what, when you start looking at what's going on with it now, look at the, look at what the Fed's trying to work from right now with, you know, missing data or delayed data. And then what we've been watching a little bit closer now is particularly this year, is all the updates that are coming to the data.

Right. So maybe there's something that's, that, that kind of plays to your point about antiquated models. So I was, I didn't know this. You know, you have the Fed governors and they're in from different regions and all.

That all came about in like the 1800s or something, because the regions that they selected, they needed to be able to move checks from one location to another very quickly. And so they decided they needed Federal Reserve in certain locations to be able to move checks from one place to the other. And that's actually. Yeah, so all of that, all of that governors and the locations and all of that stuff, I mean, the whole, the point being, right. The whole infrastructure of all of this is based around things that happened literally almost 200 years ago.

So I think your point and his point, right, is hey, can we come to 2025? And, and how do we operate with, you know, in general with all of this? That's a little bit more modern and a little bit more relevant based on what we have today, which we didn't have then. Yeah.

As there. So thank you for that. I think you're right on. Right. And then we have, you know, a finance minister, Roger Douglas from New Zealand. Now, I love New Zealand. I've been to New Zealand. I have, dear Friends in New Zealand and been there racing sailboats before. But when you have their finance minister in 1989 make a casual comment to a group of press people, the 2%, you know, it says, you know, I just looked this up real quick. It says leading to a 0 to 2% range to combat high inflation eventually became the global standard. And I mean, I remember seeing, looking this up once in the past and seeing a picture and like this guy's like walking down a hall and some people are holding a microphone and ask him a question and that now we have that number. So you look at your discussion about, you know, our comment about these, you know, Federal Reserve having these Fed banks, right. They're, they're Boston, New York, Philly, Cleveland.

Atlanta, Chicago.

Quite a lot of brawls, a lot of, a lot of, you know, controversy over where they were located.

Yeah.

Because they needed to be strategically located to be able to get money to move, you know, from one place to the next.

Yeah, well, and if you look at where they're located, I just am looking at a map here. You know, they are very strategic.

Right.

You've got, you're just working your way across the country from, you know, Boston, New York, Philly, Cleveland, Richmond, Atlanta, Chicago, St. Louis, Minneapolis, Kansas City, Dallas and San Francisco. So you've got all of these now and you've got a governor from each of those locations that sit through that. But you know, if that's from, if that's 200 years old and we have a, you know, 30, what would that be? You 36 year old idea of the number. And we live in an age of AI and instant data available at our fingertips. We're just an example of that on this show of just being able to hit Perplexity or Gemini or whatever your favorite AI research tool is and come up with data quick. There's probably a better way to do these things, but.

Dr. L. Horain just talked about a handful and I just wanted to mention this to everybody here because he's a great guy to follow on LinkedIn. It's his newsletter they publish. It's called Global Economy and markets. There's almost 350,000 subscribers.

But he talks about market expectations for the rate cut surged back to 90%. I don't know what Poly Market says this morning, but probably even higher than that now. But he just talks about 94%. Okay. Yep. So, you know, he talks about equity markets, gold pricing, what we should be looking at and thinking about in the weeks ahead, and then talking about other parts of the world. Talks about the uk, you know, needing to monitor digestion of the budgets that they're working on. The bank of England's periodic assessment of stability markets in Japan, Saudi Arabia, other parts of Asia. And so anyways, it's, it's a great newsletter to follow. We'll start including a little bit more from it as we go along as well. So, and then moving ahead, Tom, this is from a couple of days ago, but US import prices fell flat in September. This from Reuters.

So it's just kind of interesting, these ups and downs and they're, they're dips of these ups and downs as well that we're seeing.

Yeah, I mean were they expecting higher costs in September?

It said, let's see the report. This again was a delay.

Right. This is what we're paying for imports.

So it, where was I at here? Just had it said economists continue expecting acceleration in the paths through pace, arguing that continued decline in margins at businesses was unstable and could hamper spending. So we have a follow up article about that and there's a couple of them here. Our next article actually talks about, from Distribution Strategy Group talks about inventories that go with that. So what I think we're starting, and we've got two or three other articles and I think what we're starting to see here now is the, the tariffs are as, they're starting to get digested. Right. And they're starting to get passed through. We're seeing these, you know, prices falling flat. I think they expected them to go a little bit higher. But now we're seeing inventory as.

Flat inventories as well. And we're in a season right now where normally people would be gearing up, they would have geared up inventories, you know, in the retail side for the holidays and so forth and the wholesale side or the B2B side of things, they're typically ramping things up for the new year and that's what's looking at this kind of falling flat right now. And, and people are sitting on a lot of cash kind of waiting to see what's next.

Do you think that people are waiting to see how the Supreme Court ruling comes out?

I don't know how you can, you know, I mean if you're, if you're an office products distributor or you're an electrical equipment distributor, there's projects and jobs and work that's still going on every day. Maybe you're doing a little bit less and a little bit of a balancing. I don't know, maybe we've got any guests or anybody Listening in that would like to chime in on that. I think it's, I think you would. Right now, that Supreme Court component of it is, you know, maybe you're hoping for something. But I think right now people are just, we're just starting to get the feel of people digesting it all and it's flowing through their business a little bit more now.

Yeah. And there were definitely some peaks right. When people jumped on inventory during the thing. So, I mean, I don't, it's hard to look at, I think, a very, very small time frame and make any major conclusions out of it.

No, I, I mean, we've talked about this many times. Right. My view has always been that the, the best thing that can happen with tariffs. And I think, look, we, we've, we've, we have differing opinions on what's going to come out of the Supreme Court's decisions and what, you know, I mean, we have an article here we'll talk about in a moment about Costco suing the government over their, their tariffs that they've been paying. But.

The idea with this, I think right now is I don't, I don't think anybody can argue that we're going to have tariffs. The argument is what statute or law is going to be used to get those in and then what is the number. But I think what the, the administration, in my opinion, is missing right now is the opportunity to say, look, instead of using this as a hammer, let's just get it done. You know, let. Get the Supreme Court ruling of do you have to, can you use the statutes that you used or do you have to use one of the other three or four that we've discussed a number of time on, times on the show, pick what it is and then get them settled. Right. Is, you know, I think I mentioned last, last show, not last week, but the prior show. I had met with somebody earlier in the week from a Chinese manufacturing company. And, you know, he kind of, I don't say alluded to. He actually said it. He said that, you know, there is a level of thinking at a lot of Chinese manufacturing firms specifically related to the industrial segment which he was involved with. And I had a gentleman visit us, visit us at our offices, and we had this discussion and he was saying there's kind of a thinking that for at least a year there's going to be about a 50%.

Tariff there. So.

We'Ll see what comes next out of it.

You know, I, I just had a, I think, which would be a billion dollar idea. We should take the yearbook like that we're talking about, but then ask AI to use all of the data from this year to predict what's going to happen next year.

Synthesize some data.

Yeah. And predict. And use all of that to say, okay, what do we think is going to happen over the next 12 months? And then we can compare it and see how screwed up it is. Or not. Or not.

What, how screwed up what is the prediction?

Right, the prediction.

Your predictions are always good, right? You tell me that as far as.

In my world they are. Yes.

You say my gut tells me as.

Far as I know, yes, they are. That is correct.

Okay, very good. So this, this article that we had though about.

Flat US Inventories raises a question for distributors. And this was a nice article from our friends Ian and Jonathan and their team over at Distribution Strategy Group. And they've got some great writers that work with them and they kind of digest some stuff sometimes I think is really good. But this was talking about, you know, inventories issues. And it says for distributors, especially in industrial construction facility supply, the flat readings suggest conservative inventory positions heading into year end. Leaner stock levels can support margins in the short term. But analysts say the tight stance also reflects concerns about whether orders will hold up into 2026. Companies that traditionally use the fall to replenish may instead be focusing on working capital discipline and shorter forecast windows. So it talks about the broader. This is from an economist that's quoted in here.

Deputy chief US Economist at Oxford Economics says broader business inventory picture suggests some softening and underlying demand as stock levels remain lean. So there's a handful of implications that come here with this. Right. It's one, what is happening at the customer in the B2B world, whether it's an office building offering services that's buying janitorial supplies or buying office products or whatever it might be from you, or it's a contractor that's buying residential hot water heaters or you know, commercial grade electrical products. So it's, it's going to be an interesting piece to watch.

All right.

You want to hit on the next one or go. Or skip over to Costco.

You probably like the idea about this one. So go, let's go to Costco.

Well, I find it really interesting. So but let's kind of set. So the article is Costco Sues for Trump Tariff Refund Cites imminent harm. And we'll talk about this in a minute. But let's just kind of quick do a re baseline on the Supreme Court situation. So the Supreme Court this Is again Poly market Supreme Court rules in favor of Trump tariffs 28% chance. Okay, down, down quite a bit over the last, of course, over the last. But similar to what I think we discussed a couple weeks ago, however, there is another polymarket is will the court force Trump to refund tariffs? Only 6% believe that they will force them to do that. So basically what the poly market's saying is the Supreme.

Right. Wait, let's just say right there it says Kevin's right.

No, not really. No, I think, I think it's, he's not going to force them to refund tariffs. Right. Which then I think now ties us back full circle to the, to the article here about Costco suing proactively basically before this is happening, trying to get line. Right. They wanted to get jumped the line and get a hold of this by saying because the Costco isn't saying, well this is dependent upon how the Supreme Court rules as far as the refund goes. They're saying that you owe us refunds or you should refund us for all the harm and damage that you've created. You don't think that this legally, I mean obviously Costco has a lot of intelligent and smart lawyers working on this. You don't think others are going to jump on that bandwagon?

Sure.

Okay. That's been, my only point is that people are going to want.

But they will, but they're. The suing is one thing. Right. And you'll probably find a.

Unfortunately you'll probably find a left leaning judge that would like to smack the, smack the president around a little bit that will put, put, you know, agree with this and then it's going to go get litigated further. And my point with all of this is it says, you know.

I don't, I don't. There's no question that, that there's going to be lawsuits about it and probably some of the lawsuits will be won and, and then they'll go into appeals and they'll get dragged out and then there'll be no methodology. And then what we're going to find is actually that those same ones are similar numbers are what's settled on using the correct statute. And it's going to be how do we don't know how to pay you. So. Yes. So great, Costco, now you have a judgment against the government.

What does that get you?

Well, they're obviously they're looking to get something.

I think they're looking to set a precedence perhaps. Right. But I do. Do they get what was I Can't remember what the amount was that they were.

Not much, actually. I mean, I thought it was. It was less than I expected.

That was a couple hundred million or something like that.

Million dollars? Yeah. I was surprised for Costco.

At the same time, it's like, okay, so what do you. What do you gain other than you've sent it? Set a precedent of some sort of. But if you're wrapped up with the government and the government says, oh, by the way, we don't have any methodology right to pay this, and you get a lower court that says, here's a judgment against you and does, you know, and my assumption is that this is Costco lawyers and, you know, probably good for them that are coming into this and saying, hey, we're going 100 miles an hour at this, and we want to be, you know, we want to have some statements in place, or I shouldn't say statements, but from judgments in place, if we can get them. But we're at the, One, at the front of the line, and two, we're leading the charge. And then if lots of other people get behind them, then maybe there's some momentum they can get out of it. But do they recover a penny?

I don't know. There's no poly market on that yet. I think that they will. I think that com. I've said this all the way along. I do think that these companies and a lot of these companies will recover stuff. How long it takes and the process that it goes through. Don't know what.

Go back, if you wouldn't mind, Tom, go back and show the poly market that you had up a minute ago.

I was looking to. I was looking to see, you know, the poly markets, right. They have a very defined definition of what this means because this. Will the court force Trump. I think the operative word here is force. Will it force Trump to refund tariffs? That's the.

The context. And I'm trying to see if the market will resolve to. Yes, if by. Oh, this is by December 31st. Okay. So I don't think this is actually all that accurate because we won't have a ruling by them. But the Trump appeal is denied and hold apart. US Importers receive at least funds. Okay. So I don't think.

Remember, as you're reading that, don't read it very clearly because most of our audience is listening, not watching.

Yeah, hold on. Okay, sorry. Just getting this to scroll properly is. Okay.

So those of you that are listening on the recorded podcast and not.

You don't understand my mumbling that I'M going through here. I don't understand.

I don't understand it. And I'm watching you. So, so the Thomas we have up on our screen here for the live show on LinkedIn Live, YouTube Live and Facebook. We you know what's funny is I'm hitting pause here. We never even did our intro to the show today.

Sponsor nothing about what we do every week, nothing about the newsletter.

I guess people figured it out, huh?

Doing something here with a newsletter.

Those of you who continue to to log in and listen to this, thank you for putting up with us. Yeah, you know, the in and I John, our editor and producer probably doesn't want me to say his last name or his, his agency's name because he'll do the work, but probably doesn't want to be associated with what hacks we are sometimes. So anyways, we're reviewing the newsletter that we put out every week. It goes out to roughly about 10,000 people, as you can clearly tell by today's show and other shows, as Tom and I are not professional podcasters, but we do like to get together each week and talk about the news of the week and how that impacts wholesale distribution manufacturing. So Tom has his screen up right now and on his screen we're looking at a poly market. But before we do that, Tom, I will say we're reviewing the newsletter. We're talking about these articles. We didn't do our intro today. If you like the newsletter that we talk about and I'm supposed to about halfway through the show always remind people anyways, so here we are. Here we are doing it for the first time. If you'd like the newsletter and you don't get it, just reach out to us anytime.

The you can reach us@helloadsmartech.com or you can go to LinkedIn and look at look for around the Horn and wholesale distribution or if you go to the Lead Smart Technologies page, which is a company that Tom and I work for and who sponsors the show each week. If you were to do that, you can see access to the newsletter there. And then finally we have a website for the show. It's www.aroundthehornpod.com and we'd be happy to get things free there. So poly market that Tom has up right now, polymarket is in a an online what started as a betting format but now it's a prediction format and go ahead, take it away, Tom.

Well, and I apologize. I didn't realize that this Poly Market is based around a action taking place by December 31st of this year, which is why the 6%, in my opinion, is no more.

Yeah. But I'm sure there's other ones that.

Are very clearly I couldn't find anymore. I mean, we should definitely look, but I couldn't find one that extended out farther. But basically the market will resolve to yes. Meaning will the Trump court force Trump to refund tariffs if the Trump's appeal is denied in whole or in part, number one. And number two, US Importers receive refunds for at least some of the tariffs and validated by the May 28, 2025 ruling. So again, I don't think that's going to all happen by December 31, hence the very, very low. So the 6%'s not really an accurate, an accurate story. But so it's going to be much higher than that. And we'll try and maybe next week try and find something that's a little bit farther out and a little bit more accurate.

Keep an eye on that. But, you know, let's go to Wes's comment.

Yeah, that's a great question. Yeah.

Wes works with our friends at dsg, formerly Dakota Supply Group. Great group of folks over there, some dear friends. So great comment. Great question. Wes is asking Tom. So I want to hear Tom's response. But Wes, I get an opportunity to chime in on this, too. He says, do you think that Costco would have to prove they didn't pass this additional cost or financial burden onto the consumer? So Tommy asked you the question. What are your thoughts?

I think they will have to demonstrate that they.

Took most of the burden themselves and they would have to be able to, you know, I'm not, maybe not all of it, but I think they're going to have to demonstrate that yes, they the $200 million they went to their, you know, but one of the quite the things that they did state in the lawsuit is that it provided imminent harm to members. So maybe that is their and maybe that is what they're stating is that that imminent army to members was through additional costs that they shouldn't have had to pay. And maybe that's the way they're going to get around that or at least be able to say, hey, it provided harm to us and it provided harm to our members because some of those costs were having to be passed on. So.

Okay, but to me that makes it even less likely to get a ruling in their favor then, because if you passed one penny of this on to your customers, then you need to prove how you would take any money that you got back and Pass that back.

To your members, of course, but they could, but Costco, Costco could. Right, because they know who you're, who you are, they know how much you spend. They know all of that.

So they're going to spend 100 million of to 200 million dollar in judgment with the, with the implementation of putting that in place and getting it done. Right. I mean, to me that, to me the big issue with this is is it, is it logistically possible? And what I think this is, why.

Do you think Costco did this? Why would they have spent all the legal time and effort to do this if it is logistically impossible?

I think it's get at the front of the line if, if something is going to come out. But I mean, if you think about it, and maybe, I don't know, the answer to your question is, I don't know.

I think there probably is a handful of reasons and maybe it's, if there are dollars coming back and there's, I mean, I don't say I'm at the front of the line because it doesn't mean you're, just because you want a lawsuit, you're at the front of the line. But if you're the one banging your chest over this and then, and you want that money back, right. Then let's get, let's Costco do it. And maybe Walmart comes in behind them and Sam's Club or you know, whoever it might be or Kroger or whatever it is comes in after that and you get a lot of beasts behind it. But to the question, and I appreciate Wes's comment here about this is if they have to prove that they passed it on, there's a ton of burden on them. And then if they have to get a ruling, I mean, to me, with a little bit that we know about this, to me common sense would say, okay, well if there's a burden that you've had and it's negatively impacted your customers and you want us to reimburse you for it, show us, show us your methodology to get this back to your customer. And you know, I mean, do you really, do you really think that, I mean, I don't know how many people shop at a Costco every day, but you know, there's got to be millions of people that this has impacted. So you're going to give a million. Let's just say it's 200 million people have been impacted. You're going to give every one of those a dollar?

Maybe. I mean, I don't know, I get a Rebate. Don't you get a rebate check every year from Costco?

But that's on my spend, right?

That's on their spend. Right. So couldn't they add a little bit more to that rebate check based around your spend? And, and the relative may not be much, but they could add a little more to that rebate check.

Because they know how much you spent, they know what you bought, they know how much potentially was impacted by tariffs if, you know, based on the products that were. They're there.

I mean, so get this. My friend Gemini says that Costco estimates they have around 350 visitors per hour per typical store, meaning hundreds of thousands to millions of people daily across their worldwide locations. Right.

Okay.

So there's another report here says that as many as 3 million members per day per per store. So.

What, how do you, how do you, how do you administer that?

The administration part of it to me doesn't seem difficult because they're already doing stuff like this. Is it. Would you make any money? Probably not. You might get a dollar or two when everything's said and done. But again, the administration of it, I don't think is that difficult because they're doing it already. Right. With the rebate checks.

And see, I think, I think if you were to look at it, if I were, if I had Darlene, if Darlene went back and looked at our Costco spend and I do most of our Costco shopping because I'm. It's dangerous when she's there. We spend a lot less when we're not there together. And I do most of our cooking and probably 75% of our shopping. But if we were to take a look back and look at.

Our spend last year versus this year, I would suggest that the vast majority of our. The increase is inflation driven, related to food prices, which are not tariff driven.

Which are not tariff driven. Correct.

Right.

And I said tri tips are coming from China and I don't think they are.

Yeah, it better not be. But, you know, it's the.

You know. Yeah, it's the, it's the meat. It's the, you know, it's us meats of even paper plates or whatever that are coming from Wisconsin from a paper plant or whatever, you know, so I. Anyways, it'll be interesting to have this, see how this plays out. The comment of the day goes to west so far is, you know, would they have to prove this out? So we're, we're stuck on a topic that is probably very circular on this because we just don't know.

No, but it's not going to just die. It's going to have, at least it'll have some interesting drama associated with it.

I, I, I would believe right now. Where are we at today, Tom? 169 epis. Yeah. I would believe we could be well into our 325th to 350th, 50th episode before we could answer the question.

Easily that far, if not farther along before we can answer the question. Is anybody going to get any money back from terrorists?

I think that's a great poly market. What episode will we be at before anybody gets any money back?

Well, you were going to have, you were going to have built that year the, the Tom's Markets, right. So that we, we could track these things. That's your, that's your holiday that, you know, the days that you have off on the holiday come coming up. You can build that out that, what are you going to call it? Polly Tom?

Yeah, yeah, something like that. Polly Burton.

Polly Burton.

Yeah.

I think I met her once. High school dance.

Okay. Yeah, that, yeah. Well, I'll get our picture and we'll put it on there.

So hey, I, I like Mike's comment as well.

He's saying, can you highlight that?

Well, I'm not sure if I like it. I just, it's, it's a good comment. He says administrative burden to return a tariff to a consumer overwhelms the actual benefit returned.

I would tend to agree really fast, huh, Mike? Tom's, Tom's not liking that.

No, I think he's right. I think he's right. It doesn't mean that we're not going to go through all this drama that we just, we just talked about.

So, so, so Mike, and Mike's just what a great guy. Thanks for being with us, Mike. The got to get Mike back on the show. Actually we haven't had him and I don't think he's been on with us this year. Mike is, runs the employee owned group at ARG in Pacific Northwest and Alaska. Great, great company, great leader there. But I think Mike just distilled what I've been kind of trying to say is like there's too much, there's too much hassle behind it and there's too many things and there's too many stops in, in the way and there's too many lawsuits that are going to come. That put it this way, Costco is going to spend more than if 200 million is a number that they were looking at. They're going to spend 50 million in. In resources to get to try and get to that.

Yeah, well, maybe they're going to use AI lawyers to handle it all for them. So they're not going.

You know what, as you say that the.

I've got to get to.

I'll dig in on a little bit more. We'll talk about in the future. But you know, as you know and a lot of folks that are here know, I've spent most of my life racing sailboats and just before getting.

Just before getting married I raced. Had an opportunity to race at a pretty high level and raced in two or three countries a year. And, and one of the guys that I raced with was skipper on one of the boats I raced on was a.

Is that your dinghy?

Yeah. I need to.

It's.

It's funny. It's. It's Nick Pericle texting me.

From Profit Optics. He knows we have a show right now. Sorry about that, Tom. Thank you. I will.

Scold him later. But.

But anyway, not. Not text you.

Yeah, exactly. Right. You know, so next week is the Hardy H Vac and Plumbing national event in Las Vegas and Nick was texting me about that. But hey, somehow he found a way to get his name into our show today so. In his company. So there you go. Maybe that's what it was. But anyways, I will comment on this later but a buddy of mine, John Sweeney that I erased with and John's up a Bay Area guy and I did some racing with him on some vintage America's cup boats in the mid two. Was it 2004, 2005. Somewhere in there. And John has just. Okay, we're on. Do not disturb. Turn off.

Do not disturb.

I have it on do not disturb. So let's see the.

John has. I'm. This is exciting. John owns a piece of property or owned. He had it seized by the state of California, a small island in the far eastern edge of the San Francisco Bay. And he had turned it into a kite surfing location. But anyways, he is well into the first, what appears to be the first ever RICO lawsuit racketeering lawsuit against the state of California. All kinds of different boards and organizations within the state and the federal government that it appears he's going to probably win. All drafted with Grock. Oh wow. Okay. Up until recently no lawyers were involved. But he's got it far enough down the path with Grock and he's. That literally people have resigned from their jobs within the state of California over this thing and now he's got lawyers flooding to, to support him. Pretty cool.

Yeah, that is interesting.

So anyways, that's kind of an interesting piece that goes with that. So let's, let's jump ahead on this. But I think we are, we'll see more of this type of stuff where you know, we'll be the AI tools that are going to be out there. Pretty phenomenal. And some of the just makes me think some of the synthetic data that you pulled together using AI this week with one of our customers that we're working with some of their data to show them some, some things that are coming out of their, their internal data that they never even would have imagined before. So it's exciting time with that. Why don't we jump ahead? Manufacturing, distribution. Black Friday expands in B2B as distributors launch verified deals. This is again from our friends at Distribution Strategy Group but kind of an interesting thought. You know, we, we think about Black Friday and what is it?

Online but not online Monday, but Cyber Monday and then local business Saturday or whatever. Those come together. But it's interesting. This talks about an E commerce report into the B2B world that says that 85% of B2B focus sellers plan to participate in Black Friday sales this year. That was kind of cool to see that.

I think we've been seeing that increase a bit year by year. Right. Every year the consumer, you know, just the Black Friday I think concept is hey, deals to be had.

Yeah.

And you know, why not take advantage of that brand sort of aspect of things. I don't know about you, but the amount of Black Friday stuff I got bombarded with over the last week or two.

Yeah.

From B2B and B2C and then you actually start to look at really the quote unquote deals that were there. I was not impressed. But everybody.

Pardon.

I bought some clothes.

There was definitely some good stuff. But there was a lot of just noise too at the same time.

Yeah, that's. Yeah, it's typical. I But I mean the thing, the thought about it from the B2B side of the world and that growing in that segment is great. You know, enough. You know, west and Mike, both with large distributors, if they're still there. Did they do anything that like that in their business at ARG or DSG or ABC or xyz? But it is kind of neat to see this and you know, the stronger you get into E commerce, the better off your better you're able to do this.

Sure.

So anyways, you see msc, Industrial Grainger, a number of others participating in this and it's kind of flows across but I think it's.

I guess when you see the amount of E commerce and it's my my question that really kind of goes with this is a good example is I bought some clothes from a company that I typically buy clothes from anyways that have regularly regular ongoing sales that are really, really good sales.

The.

Across the board really, you know, really good sales. And so I kind of start, you know, seeing it with E commerce. We're seeing such great sales, you know, all the time anyways or not all the time but often it's like do I really need this and is it that big of a sale? Right. Or will I see it again in two months? Something similar.

Yep, yep. No, I agree. And, and anyway just an interesting thing. I think we're going to see more of that and I think, you know, a lot of companies will look for the Black Friday as a way as a buying opportunity.

Yeah.

Good.

So next article this MDM posted. This is you know hardy the Heating and Refrigeration Air Conditioning Distributors International. Their big event is next week. I leave for that on Monday. I'm looking forward to seeing some great customers and industry folks at that but within that the they do a monthly recap of their members and it said they saw sales decrease by 1% during October. You know, at some other industry events I was at earlier this year though, I talked to a handful of their members that are up, you know, 10, 15% or more so across during October.

This was just one.

Correct. Just October.

Yep.

Right. So and then I'll see a lot of those folks next week in in Las Vegas. My one of my least favorite places to go.

That'll be great.

I will walk through a casino and send you a video clip as I walk through it.

I can, I can teach you how to play craps between now and then and you can, you know, get all your Christmas.

There should be a poly market on that because there's absolutely zero interest. I am highly successful at doing very average in the stock market. So the the idea of wasting my money in a casino is I always you know, joked and dad dad used to when we were driving as a kid we drive as a family up to see our family in Northern Utah and every year and we'd stop and eat at a buffet or something in Vegas and you know, dad would go play a couple of hands, a blackjack or a slot machine or something real quick just. But I remember him saying things like, you know, these bright lights and these fancy places aren't here because people are winning.

That's true. You know, but the craps, if you play it correctly, is the best odds game you can play in Vegas.

So but for every, every wizard at the, at the blackjack table or the craps table like you are and your love for, for poker, there are probably thousands of thousands of losers leaving and just why that gambling is such a big business now. So anyways, let's jump ahead into our E commerce and marketing segment.

Tom.

Okay, which, which of those articles we have an article about Amazon's AI agents putting some pressure on, on distributors. A couple other articles about AI agents in there as well. Any of those stand out to you?

Well, I think they're all, there's all three of these are kind of interrelated a little bit. But the first one, Amazon AI agents elevate customer service pressure on distributors. So Amazon has a product called Amazon Connect that is a customer service application. It's sold through their web services division and from what it appears is they have released some new AI agents that are.

Part of this that can really do deep research. Right. So if somebody wants a return or they want a price quote or they want, you know, whatever, this is all kind of customer service inside sales, right. Related type of pieces here. It can do very in depth research, deep research on your contracts, your pricing schedules, all of those things and kind of take care of all of that for you or for the customer service person. It wasn't clear. I think obviously there's a lot of self serve in here, but there's also sort of a hybrid model where it can help the customer service person as well. This is more of a direct competitor of agent force right on the service side of there. But, and I don't know anybody who's using this in our industry. I have not, I've not run across this with anybody that's using this. I'm not saying they're not, but I haven't seen it. But anyway, I think it's just a good example of some of the things that we should expect to see more of over the next year.

Well, so here's the, here's the rub and the point behind this article is. Right is it what does it mean for, you know, our traditional distributor? Right, right. Their comment here is that, you know, aws that companies can deploy out of the box agents or customized behaviors and actions to match internal service policies and so forth. But it says this announcement comes as distributors face growing pressure to deliver faster, more consistent.

Service and post server, post purchase service across E commerce, phone Chat and inside sales channels. And I thought it was interesting. It says many distributors still rely on legacy PBX systems, siloed CRM environments and manual processes. Anybody else ever talk about that? Siloed data?

I haven't heard that term before now.

I just did a significant post on that two days ago on LinkedIn. Right. Is we've got all this data across our organization and now we want it. And everybody's rushing to go to the next AI event or the next webinar about AI and they're looking about it. And Silicon Valley is, I used the term talking to somebody recently. I said Silicon Valley is minting right now new startups that want to come into wholesale distribution.

And coming into these companies to help them with supply chain stuff or rebates or whatever it might be. And at the end of the day now we just have more silos, right? So we have AI.

This Amazon Connect is not going to operate with siloed data, right?

No. I mean the point of this article was if you're a wholesale distributor, this is the future, right? It's not about what Amazon is doing. It's what is if you're a.

50 million dollar 100 million dollar three quarter of a billion dollar billion and a half dollar distributor. Mike, I'll send you the check later. The.

If you're that guy, this is your competitor. And what they're doing with all of this is they're setting the bar for what your customer's expectations either are or will become. And we've talked about this as long as we've been doing the show, or at least I have as long as we've been doing this show, is that we're moving in. We're certainly in a gray area between a B2C experience and a B2B experience. And what Amazon is saying here since the day that they started Amazon Supply, before we got to Amazon business and so forth, since that's happened, right? In Amazon, stated that they came into this market to go after Granger's 3 billion in online purchases, right? That's why they did this. And now they're saying, and I've told this story on this show before, and this was in the 2010, 2011 conversation I had with a manufacturers rep in the Pacific Northwest who's not far from Amazon. And we were literally at Amazon's headquarters for a meeting together when he was telling me this story. And he had just driven back from Spokane, Washington back to the Seattle area, stopped at a wind farm that was being built and the guy in the wind farm, this was like the latest it could have been, was 2012. And the buyer there, he, there's a manufacturer's rep and he asked the buyer from this wind farm construction company who he buys from. And he rattled off all of the.

Usual people that you would hear about in the Pacific Northwest buying industrial or safety or construction stuff from. And he said, but I buy more and more every day from Amazon because when I go to distributor, I won't mention these people, but I know them, some of them listen to the show is that guy will have 60% of my order available tomorrow. The next guy will have 40% and the other guy will have 72% available in five days. I can order it from Amazon, I can use my personal Amazon prime account and it'll be here tomorrow, you know, and so now we've got the graying of this whole arena, which is literally, I think it's not going to be gray. We are going to be pushed into an arena where we have to have the same experience or nearly the same experience that we have in the B2C world in this setting.

Yeah. Well, I want to hit on Mike's other comment here. The vast majority of distributors don't even have the platforms or data integration on board in order to realistically tap into agent usage.

Yep.

So I was, I was going to touch on this later, but I'll touch on it now. I do believe that 2026 is going to be the year of data. Now I'm going to, I want to put some caveats or some structure around that. What I mean by that is not, hey, how do I go take all of my kitchen sink data from all over the place and throw it all into a data lake? That's not what I'm talking about. What I'm talking about is really understanding, okay, what data that we have in the organization, right. How do we put context around that data so it can be used in an agent situation? And what synthetic data can I generate from that source data that takes my data capabilities to yet another level right then. And this is exactly. And you would have to do all that anyway to be able to use some of the things that we're just going to be talking about. I do think, to Mike's point, I agree it doesn't exist today, but I think this is going to be the year where companies are going to really start to recognize the importance of investing in that aspect of things. Because if you've seen, right, what's been the last year or two, the run to the Data lake. Let's create a data lake. We're going to put all of our data in a data lake.

What are you going to do with that data lake tomorrow?

Well, and data lakes are not, I'm not saying data lakes are bad. I'm just saying that data lakes are just one piece of the puzzle, right. That need to be. And you don't even necessarily have to have a data lake, but it can be one piece of the puzzle. But I think this year is really going to force the issue because the agents and the stuff even we're just talking about here, it doesn't exist. It will not work without having the ability to aggregate and remove some of the silos that I know you'd like to, to talk about. So anyway, we need it. We're preaching too much.

Well, no, no, we just had a listener say, say to preach. That's what I heard there. Well, I think the, the issue though, you know, and it's this goes back to what, you know, you're saying about people wanting to go get your data lakes. I think part of that is they heard about somebody else doing it. The Microsoft rep is calling every day. A snowflake rep is calling every day.

Easy to understand, right? The concept is it great. It's like, oh, I got a lake and I'm going to put my data in there. Yeah.

Right, right. It's easy to understand and easy to write and some of these other things are less easier to understand. But again, I'm not against the data lake. A data lake can have its place, but a data lake by itself is not going to create the, the data strategy that you need to drive some of these agents and some of the things we're talking about here.

Yeah, well, you know, in, you mentioned the silos that I like to talk about. But look, you know, the next article there is that, you know, Amazon CTO says AI will redefine E commerce right in that setting. The next article after that is Gartner says AI agents will command $15 trillion in B2B purchases by 2028. Okay, so now there's two components I think that are important here is one is what are we going to do with E commerce? But now E commerce is a customer journey. And what I, you know, going back to the preaching side of this is what I preach and literally was with a, you know, large, very large regional.

Plumbing and PVF distributor yesterday. And fortunately they're nearby, got to go visit a, you know, prospect and slash soon to be customer in person. And we were, you know, having this discussion, exactly where the future lies right now is if we're going to use AI correctly in our business, we need to tap into all facets of the data that's available about our business. So the data lake can be where we put the unstructured data like the manuals, the PDFs, the spec sheets, word documents, if they're a value to us and need to be searched and have AI run against those. And then our structured data that's outside our software products. But if we're using lots of different software products and let's just think about right now.

E commerce, marketing automation, ERP data are the most common, right? And then, you know, right now I'd say, you know, minimum of 50, 60 plus percent of the people I talk to in the world of wholesale distribution and I talk every day, all day to these folks and go to, you know, seems like countless events is 50 to 60% of the people we talk to have never even had a, I'll call it traditional CRM in their business. But now if you think about the interpersonal interaction or personal interaction that's in a CRM, if you're using it, well, with what happened with the counter sales guy, the info he got from a truck driver that was coming in to pick up an order about the company or a job, what data did customer service or inside sales put in? And now we have, if you're doing things correctly, we're bringing a platform view together versus a software view where you're looking at multiple customer journeys. And now we can run the AI against all of that, plus that structured and unstructured data that's in the data lake as you're describing. And now we get the real view of what's really happening with our customer. And if you buy, if you try and build on your own or you buy off the shelf CRM and you're using that, you, you have a siloed CRM, you have siloed marketing automation. And that's the dilemma of trying to really maximize AI is unless you're looking across all of your customer journeys. And this is a little plug for what we do because of our partnership with Salesforce is we can use the data cloud and the agents that go with that. And we bring all of these things together instead of talking about CRM, we're talking about a unified data source where we're really looking at what's happening at the cloud customer from all angles versus what did they buy last month, which is a rear view mirror view of what, erp, says so we're in this place where some the people that are going to be able to get a real look across their customer are going to be the ones that are going to be able to do these types of things with E commerce because they're using their data correctly and all these pieces are going to come together. You know we were talking earlier in the week and I think you said you wouldn't be surprised if people going out of business. I've kind of always said if you're not going to be doing these things, you may be moving from 20 branches to six branches over the next three to five years because somebody's going to come in and start running circles around you because they understand the customer better.

Yeah, I think that's what Mike was saying here. Right. Distributors and I think this aligns what I'm saying the year of the data coming up. He's saying there, what he's seeing that there are is a initial spread starting to exist between investments and data and that and that will definitely accelerate over the next year. And those that go all in will have a big competitive advantage and those that don't, won't.

Yeah.

And I knew I liked it. It's not as hard as it sounds too. I think there's a lot that can be done. I know it sounds overwhelming. Right. I get it. It sounds very overwhelming and difficult. But one of the things we're certainly learning is you can go at this at a very crawl walk run and even the early. There's just a lot of value to be get getting there even in that crawl stage before you're going into that crawl walk run. But yeah, all right, we've done, we're done preaching for today.

I'm not. Okay, well speak for yourself. I'm passionate about this.

Where would you like to go go next?

Hawaii.

All right.

Where we. Oh, I'm sorry. Article. Well you're, you're back with a poly market so nope, you're good. Okay, so let's go to that. Let's quickly though Tom hit with.

This.

Point about the Gartners saying this is interesting. Right. By 2028 Gartner expects organizations using multi agent AI for 80% of customer facing process to outperform competitors as AI systems handle routine interactions. This is talking about they saying artificial intelligence is on track to take over the majority of global business purchasing. With gartner forecasting that AI agents will intermediate more than 15 trillion B2B spending in three years by 2028. Crazy. Three years.

I don't and Again, that's across all industries. Right. So that isn't just the industry of distribution or manufacturers, but.

Stop for a second. Global. This is B2B.

Okay?

Global business purchasing.

That seems high to me. In three years I could buy that. Maybe in five years. I struggle with that in three years. Just for all the reasons we just talked about. Right. There is no magic here. It's not like I can go buy some agent and just drop it in and wave a wand and all of this stuff occurs. There's. There's plumbing under the, under the hoods that need. That you need to deal with.

So call your lead smart sales rep.

Yeah, he'll preach to you. He'll preach to you.

Technology, cyber security and AI. And the time we have left today. Let's roll through a few of these topics. Anything there catch your eye in our segment there?

Do you. I didn't look at this chart. Did you look at this chart on the research about.

Yeah, so there's a chart. This is an article here, the Electrical Distributor magazine. Scott Costa and his team over there. Some research that they did. They said when asked if your company is currently using any AI tools or programs, 22% said they were not, while 28% they were actively using AI tools across multiple areas of their business. 28% reported they are still experimenting. And 22% said they have AI for specific areas, but it's not widely adopted. It. So this is kind of a tepid thing. And what I need to see is.

This was a survey done with Baird Research, which they do a lot with. It's just great.

So small survey, right? 18 respondents, but those 18 responding distributors represented $7 billion in revenue. So no question about whether they had the capabilities, financial, financially, to do these things. So nothing was holding back there. Said 11% of companies say AI tools are fully integrated into workflows and they are significantly raising productivity. So only 11%. That, that actually.

Is that a survey of electrical distributors?

Yes.

I mean, that's. That's pretty good, actually.

Yep.

And. And that they're raising productivity. 22% AI tools are moderately integrated and they're helping to improve. Improve. And then another 22%, they're integrated in limited ways, but they haven't seen significant impact.

But 44 AI tools are not integrated into any workflow. So. And that. That makes sense. And my assumption is if we heard what those workflows were, they were. Are probably. I hate to say this, but they're probably rudimentary right now.

Yep. So there's a lot of things a Lot of workflows out there.

Yeah. So article there from Digital Commerce 360 about Home Depot's new AI takeoff tools which really ties into their E commerce plan. So that's kind of basically Home Depot saying hey, we've got a tool that can look at your plans for a project, interpret drawings, generate bill of materials for those drawings and produce accurate price estimates all from a software tool. And they're pushing to more into B2B is what this is. Right. Because you're not going to have sophisticated drawings for the fence that you want to repair in your backyard, but you are in that B2B segment that they the or the pro contractor world as they want to look at this. So Lowe's is working on something like this. Home Depot does it. But you know, imagine this tool. Right. And of course, you know, as Home Depot sees some results from this, you're going to have lots of other companies coming out and wanting to bring a tool like this to an SRS Distribution or you know, QXO or whoever it might be in other markets and look at these plan takeoffs, you know, but we're, we're very close. We have, we have a customer in for Lead Smart in the Rocky Mountains and they're working with a company on that right now where you can basically load files of, of job takeoffs and come out of it with your, with your bill of materials and then put pricing together for it. So pretty cool stuff happening out there with this.

Yeah. And, and you know, look, some of these, you know, blueprints and, and estimations are pretty complex. Right. And take a long time to analyze and put together. So I think they said here they can do it in hours versus days.

Right, exactly. And, and typically when you see some of these big ones, it's multiple people working day. Multiple days. Yeah. Good. Let's Tom jump ahead to our sales and M and A segment. Our good friends at MDM Auto Distribution Management published their November M and A roundup and talking about fourth quarter momentum continues on building material strength. So we're seeing quite a bit of that. This is a subscription only piece but if you're a subscriber there it's, it'd be beneficial to have that. But it's, it's good to see that we, and we publish a lot of these in our industry scuttlebutt section and even in the M A segment as well. And so it's good to see that we're seeing a lot of it in lumber and building materials is where the push has Been in the last couple months mostly. So anything else in our sales and M A segment you want to hit?

No, nothing here that jumps out.

Any of them?

Yes, I did actually. Good.

An article here, these are a couple of them for sales and marketing management.

About who's the best sales manager they've ever had. And they, they talk about some of the characteristics of that. Again, this is coming from our newsletter. So if you don't get our newsletter.

One thing that did pop out in there that sales reps were asking for.

Anywhere. Sorry, just dive in anywhere.

Well, I wanted to. I wanted to make sure you knew I read them. So there was a point in there that said that they were talking about, you know, that a lot of sales reps were asking for more AI tools and they're embracing more of those types of things to help with the sales process.

Yep, yep. So second article there talks about how reps rate their bosses and teammates and training, which is kind of a neat thing to do if you're running a sales organization. That's a good one to have as well. What I was starting to say earlier was these are all articles that are available in the around the Horn in wholesale distribution and manufacturing newsletter. So if you don't get that and you would like to please reach out to us, you can do that@hello@leadsmartech.com or follow us on LinkedIn as well for the show. And that you can subscribe to the newsletter there as well, but goes out to roughly about 10,000 people each week and we'd love to get that to you as well. So.

Let'S see, Tom, of the time we have left. Let's pick two more today.

Two more.

Is there any, I guess, is there any of the scuttlebutt or channel stuff.

You want to cover in the Scuttlebutt? Yeah, let's hit the scuttlebutt there real quick, which we do each week. This is usually some announcements and updates. Our good friends at APR Supply, Scott Weaver and his, his great team there have just completed an acquisition of a company in the Mid Atlantic area called the McArdle and Wall. So that's exciting for them. There is something that I'm going to be following a little bit closer. We have a deep, deep and long partnership with the folks at Affiliated Distributors and one of their larger members on the electrical side, Border States, has just left AD after 40 years. In fact, I think they were one of the original AD partners in that setting and they've gone out on their own. So left their AD membership. So I'm sure we'll hear a lot more about that. But sometimes when an organization gets to a certain size, they can go it on their own and do things their way and still get similar rebates that they might be able to get. So there's a handful of different discussion points about that. I don't think my assumption is if we heard a really looked behind the scenes, there's some financial reasons that they're doing that. Certainly not an issue of anything negative with with AD because AD is doing some great stuff for their, for their members out there.

So hey, I wanted to hit one side note you mentioned APR Supply. That's a great Lead Smart customer. We worked with them this week. We are going to be doing a project with them and Lead Smart to with all their showrooms to work on how we use Lead Smart and data and all of that to drive.

Sales and sales growth within their showrooms, of which they have quite a few.

Yep.

So it's kind of a new, a new. A new application in case study. I'm kind of excited to get involved in it.

Your team going to build the. The internal app for Lead Smart channel cloud for Showroom.

I think it'll come out of it actually. Some really good requirements and some really visionary ideas they have on what they want to do with it.

So a great group of people over there.

I'm really excited to kind of dig into that.

That's cool. That's good.

Good.

There's in our Second look segment that we have each week there's an article there about Canada's Prime Minister supporting announcing support for lumber steel sectors that are hit by US tariffs. So we've got quite a few listeners and newsletter goes out to a lot of folks in in Canada as well. So they're working on the growth that they have or the balancing act that they have to do internally with the tariffs from the US on those segments as well. So.

Each week we try and do what we call great reads or listens. We'll list a podcast or a, an article and there's a cool article in there from Inc. Magazine about 7 Ways to Learn faster and improve your memory. I need to remember to read that.

I don't remember. I didn't remember it.

Yeah, that was funny.

Which I was laughing. Yeah, hysterically.

So. So I stick with my day job. No comedy.

Yeah, we need like a laugh track I can put on here or whatever.

You know, I was thinking about that a while back. I was had CNBC on a while back and the Crazy Jim Kramer show. And he's got that whole box that he's got all the buttons that he can.

Also a.

Remember the gong show?

I did.

Oh, man.

Asking you shall receive.

Did you have that set up already or did you just go find it that quick?

I found it. I. I knew it was here. I just didn't know where it was.

But. Okay, let's. You got to keep that handy. That's. We need that Jim Cramer box that he's got where he just. Wham. Hits the. Hits the button. And we get all the stuff from that. It's pretty funny. That's good.

Hey, before we wrap up, I just thought this was hilarious. Our upcoming event section.

Yeah.

Remember how many there were here, like, just a couple of months ago we had. Now we're down to one.

Yeah. For this year left. We got to get working on next year's schedule, so.

Guess who that falls on?

You and. And your. And your big team.

Well, the team is growing, which is great. You know, we got two people working on the podcast now. We've got more people joining us on the marketing side of the business, Lead Smart, that support this show as well. But, yeah, it's. Unfortunately, there are some things that have to fall on the one with the experience to identify which are the right ones. So we do plagiarize the right word. We just borrow from.

The team at mdm.

Does that a great list. Yeah.

And then I've had. I really just typically augment all that, so. But it's good. We're gonna. There's. We're gonna do. We did a ton of events this year at Lead Smart, and we're gonna do even more next year and expanding our partnerships with some trade groups and so forth, which is really exciting. I'm off to Hardy next week at some great meetings with some prospects, some customers, some industry folks going to get together with Mike Hockett from mdm, since we're talking about them at the show next week in Las Vegas at the Wynn. And then Mike will be our guest next week. We'll unpack a little bit of that as well. But, man, We've got big NAW executive summit in January in D.C. i'm sure it won't be cold there. D.C. in January is a cold place from my experience. And then we just slide right in the ISA and AD and RD and ASA and NAED and Alphabet soup. Yep.

And.

And then you get to watch the budgets go up and my spending, so.

I can hardly wait. Yeah.

So you. You can mock me over that. So it's good.

All right, let's wrap up.

Great comments today. Appreciate the folks that, that shared their thinking and thoughts on, on the live show. But you know, as we've said, the larger audience is, is listening to us on Spotify or Apple or whatever it might be. Hey, side note on that, do you listen to Spotify? Do you use Spotify?

Not really, no.

Do you use Pandora or anything for Apple music? Okay, so anyway, Spotify did that thing this year that, you know what's funny is I, as we think about, even with podcasts, but they do this, what they call it a wrap. I think they look at your wrap up of your year and they give you a, they assign you an age.

Of your music on your music tastes. And so I don't, I list the Pandora when I or Apple. I have Apple music and Pandora both. But I, and I have a Spotify account. I just don't use it much. But I would be afraid of my age. It probably show me to be older than I already am because I like a lot of my dad's old jazz that he loved. But it's kind of funny looking at that. But you know what's interesting with that is our, our when I talk to people is.

It seems like if you're under 40, they're listening to our show on Spotify. If you're over 40, you're listening to it on Apple. It's kind of, kind of funny to see how that, that breaks out. But podcast audience is big, it's growing. So a couple of things from us as we wind down today. Again, if you'd like that newsletter, please let us know helloadsmartech.com or you can certainly follow along with Tom and I individually. We're both very active on LinkedIn and we have a company page for Lead Smart, that is who sponsors our show here. You can see the newsletter that's there and subscribe to the newsletter right from our page. Or you could just search around the horn and wholesale distribution and manufacturing on LinkedIn as well. And then we have the website aroundthehornpod.com for the show. But our growing audience is really on the Apple, Spotify and the other Odyssey, Amazon, the other podcast formats. The favor that we'd love to ask all of you is wherever you listen to us at, if there's an opportunity to subscribe, please hit the subscribe button. There's an opportunity to leave a review. Please leave a review. And then if you get the newsletter already and you like it, share it with some of your peers. And have them sign up for it as well. And that helps us hit the algorithms a little bit better in LinkedIn and YouTube and Facebook and Apple and Spotify and so forth. And that gets us. We typically on the show have people from five to seven countries that are catching the show live. And far more than that, that gets podcast, the recorded podcast itself. So we'd like to get this out to more audiences. A little bit of silliness that that we have, but we do try and stay focused on trying to help folks get a look at what's happening in the supply chain, what's happening in the economy, what's happening in mergers and acquisitions, e commerce and the things we talk about. Any help that you can give us with your comments, your thoughts, your reviews is appreciative. Finally, in closing, we didn't talk about it today, but we couldn't do the show without the sponsorship of the company Tom and I work for. We talked a little bit throughout the show about what we do, but we bring wholesale distributors and manufacturers technology on a platform versus traditional software where we can bring siloed data from around your business into a single platform where we get a bird's eye view. By using artificial intelligence and other tools to really help understand your customers, your teams and your overall business. We have more and more customers that are taking our system outside of just their customer facing team and really getting their supply chain folks, their operations folks, purchasing folks using that data to really understand what's happening to make better business decisions. We do that by combining that with our Smart CRM component, which is lead Smart Channel cloud. And that helps bring that interpersonal data in to make those better decisions across your business. So now's the time to really be thinking about if you're looking to grow in 2026, you should be trying to figure out how to use your data better to accelerate growth in your business. We have customers that are literally going to sign over 20% growth this year to their people that are using our platform on a consistent basis. So you want to see some benefits like that? We'd love to share and talk to you further, Tom. That's it for me for the day.

All right.

That's the high that's going to be the highlight of your day, huh?

Yeah. All right, well, let's wrap this up.

See you later.

Yeah. All right. Have a good weekend, everybody.

Be kind, be safe, do good things, and we'll look forward to seeing you soon.