Around the Horn in Wholesale Distribution - Episode #152

And look at that haircut, man. There's a lot of hair off on the back there.

Yep, yep. Go ahead.

No, I thought you were just showing off your new hairdo, so.

No, I was dancing, spinning, dancing, doing my thing.

That's because there's so much good news to talk about today. Yeah, right.

No, I'm trying to. I'm trying to offset all of that.

Okay.

All right.

Yeah.

Mrs. Mrs. Brown and the. The gal that cuts my hair had a discussion on some adjustments and changes. So, you know.

Yeah, that usually happens when I go to the barber as well. There's usually a big. A lot of conversation what to do, how to do it, you know.

Don't you just have clippers? Why do you go to the barber?

Well, because they take the little thing and they go like that and I give them a number and they do.

I'll buy you one of those.

Okay. I have one, actually.

Okay. Yeah, no, I think that would be the beauty of, of, you know, buzz cut like you have had for so long would be just the, you know, save the however many dollars a month and just twice a month, run the. Run the clippers.

Yeah. Even the barber is expensive. The barber is like 30 bucks.

So I'll have Lauren, and that's not expensive.

Okay. Well, it is compared to what it used to be.

Ask your wife what she spends.

That's true.

It's not $30.

No, that is true. That is true statement.

You might want to. You might want to add a zero. Yes.

All right, should we get our everything?

Everything in my household budget, in our household budget is negotiable, except for. Except for fingernails and hair.

That's.

That's what I've learned.

Yeah. So. Hey, Bob and Brian, Good morning. Yeah, so today's episode, we're going to talk about hair and fashion and.

And AI for Bob.

And we have AI for Bob. Yeah, yeah.

Yep. Oh, good to see Hoppy there. Hey, Brian.

All right, let's go. We got a lot to talk about today.

Let's talk about, talk about the news today. It's like nothing was happening overnight. It's funny because typically for the show, we're able to deal with that. We're able to deal with what's happened earlier in the week. Right. And now we're today going to talk about what happened overnight. But before we jump in, let's just kind of talk about who we are, what we're doing.

I was just going to say I ended. I studied last night or went through all the articles, all that stuff, had my notes Together, everything like that. And then you woke up this morning, I was like, I might as well just throw all that around. We're just starting over. Yeah.

There are some articles later in the day, but certainly in the. Yeah, yeah. Certainly in the economy and supply chain segment. So good to see. Good to see our friend Dan Judge with us this morning as well. That always makes me smile when Dan judges with us.

Yes.

So good, good stuff. So anyways, I'm Kevin Brown. I'm here with my lifelong friend and business partner, Tom Burton. We get together every Friday morning and we talk about the news of the week and we talk about things like the supply chain, the economy, mergers and acquisitions, AI technology, all of the things that go with, with that, but with the news of the week. But what we like to do is really kind of peel the onion back on that. Look at how that impacts the wholesale distribution world as well as the manufacturing world and the audience that we work with day in and day out. So I think our goal each week is to shed a little bit of light, maybe save you from having to do as much in depth research. Talked to a number of people recently at some shows and events. I've been at that. They, they appreciate what we do each week because they saves them some time in what they're reviewing and doing themselves and getting a recap on things. So that's our goal each week. And again, we do this every Friday. But what we do is we review the newsletter that we send out. Send that newsletter out to a little over 10,000 people. It's called around the Horn in wholesale distribution and manufacturing. If you would like to get that. Tom, you're making me dizzy.

Sorry.

Yeah, yeah, the, that newsletter goes out, as I said, to a large group of people if you'd like to get that newsletter and you don't. Just three simple ways that you can do that. If you're active on LinkedIn, pop into LinkedIn and just search around the horn and wholesale distribution and manufacturing, that should pop up for you. You can also do that, see the newsletters available on the lead Smart Technologies LinkedIn page, which is the company that Tom and I work for. You can send us an email to helloadsmartech.com we'll get that out to you right away. And then finally we have a website for the podcast. It's www.aroundthehornpod.com and you can sign up for it there as well. We say that because if you're listening on the podcast channels, Apple, Spotify, Amazon, Odyssey, wherever it might be, you won't be seeing the newsletter. And we have the newsletter up on the screen with us each day as we get together and we talk through that. So getting that newsletter might be helpful. We always ask one little favor of everybody that comes and joins us on the show. If you like what you hear, just leave us a review. If you follow the Lead Smart Technologies page, that's helpful to us if you're on YouTube live or listening later on YouTube, which a lot of folks do. Had somebody tell me recently that he listens every Saturday morning when he walks his dog and listens on YouTube. And so if you do that, just hit the subscribe button. That's a big help to us. Gets it out to more people. And if you're listening on Apple or Spotify or any of those platforms, not only subscribing but leaving a review is beneficial as well. That gets this content out to more people. We've been doing this for approaching three years. It's astounding to me. Number 152 today, right, Tom? So certainly not least is we couldn't do this each week if we didn't have the sponsorship covering the cost of the show. Of the company that Tom and I work for, Lead Smart Technologies is a company that has developed what we describe as the Lead Smart Channel cloud, which is an AI enabled CRM and customer intelligence platform that's solely developed for wholesale distributors and manufacturers. So we've taken the 30 plus years of our founders experience in distribution and manufacturing. We've brought all of that together to solve everyday problems that wholesale distributors and manufacturers have. What we're able to do with that is connecting what we call siloed data from across your organization. Erp, marketing, automation, E commerce, other data sources. We bring that all together to get deep customer insights, deeper insights into the teams and how teams are operating, and overall insights into the business, all on a single platform where we can use AI tools against that data rather than leaving it siloed. So we help companies grow and accelerate growth within their organization and cover both risks and opportunities to those organizations and and then expand and enhance customer experience as well. So if your company's digitally transforming, we would love nothing more than to talk to you about how our platform could help you in that growth. So Tom, ready to dive in? Talk about the mayhem of the night.

Yeah. Where do we want to start?

Boy? Well, I think we got to kind of start with maybe the jobs report, huh?

Which is not in the newsletter.

It's not in the newsletter. Which is why I'm surprised you brought it up so quickly. So, you know, Bob made a comment here. Can't wait to see how anyone justifies pals non action this weekend. So let's, let's just kind of get to the jobs report kind of quickly and, and talk about that, you know, briefly in that setting is that, look, things didn't play out the way they were expected. There's a huge revision downward from the May and June job report and the only 73,000 jobs added in July versus expected 100,000. So at the end of the day, what we have here is a gross miscalculation. Then we have a fed that, well.

Let'S, before we go any further, let's, let's, let's make sure that we kind of go through these really. Right. 73,000 this month, as you said, for July. Sorry, 110,000 expected. Okay. But in May there was 125,000 reduction and in June, 133,000 reduction. I don't remember what the number was in June. I think it was 147. Right. So June was originally 147. Basically what they're saying is, oh, just kidding. It was really 14,000 in June. Right.

Like, how do you, how do you do that?

How do you do that?

Right.

This isn't like, oh yeah, we missed it by 10% or something. This is like a 90% miss on that. And so 258,000 fewer, they're saying over May and June compared to what was actually reported. I just, I think it's really important to understand the magnitude of how screwed up this seems to be.

Well, so couldn't agree with you more on this. I mean, in the business world, if you come back with those kind of misses, right. There's ramifications to that. Right. You're, you're either on notice or you're no longer a vendor. If you come back with those numbers as a vendor to somebody, if it's internal, you've got some explaining to do, as they say. Right?

But think about the fact that these aren't even just projections, right? It's one thing to have a real number forecast. These were supposedly real numbers, right. Of which our economic policy, our rate decisions and everything were, if not based around, certainly influenced significantly. And to be that far off, it's, and, and I haven't dug into this. I'm sure there's a, quote, explanation why they're so far off, but.

Well, it's not come out yet if there is.

Right, but if there is an explanation, then wouldn't it Mean like, wouldn't it mean, like maybe there needs to be a rework of the process or, or maybe start using A.I. i don't know. You know, as Brian said, they've been doing this for a long time. I haven't seen this much of a gross change in a long time. I've seen, you know, I don't remember as many of that.

We see adjustments almost every time.

Right.

We talk all the time here on the show about adjustments to these things. But I think this time, and maybe there's a little difference here is, and this is where I'm, you know, maybe I just don't understand how Washington works enough. But, you know, I just think about it in a corporate setting, if you made the comparison right, if you have doesn't even need to be sister companies, if you have channel partners, whatever it is, if those partners are going to be working on something and making some decisions that have a major impact and you've got data that need, they should probably know you share that. Right. And to have the idea that the Labor Statistics, Labor Statistics Board, is that right?

Yeah.

Bureau of Labor Statistics. How are they not giving a heads up to the Fed right before their meeting that, hey, because Powell has been hanging his hat for multiple years on jobs, jobs, jobs, and he did it again Wednesday. Right. We got to watch the jobs and the uncertainty in the market and blah, blah, blah, blah, blah, blah. And, and I think we're going to, you know, although we saw some adjustments yesterday, we'll talk more about tariffs in a bit. But, you know, we're starting to see some balancing with, you know, the eu, Japan, South Korea, these trade plans in place, that instability should be balancing a little bit. Unless there's other monkey wrenches thrown into that. It's, it's just seems crazy to me that if you've got a Fed that is on the cusp and we had, you know, I'm getting ahead of myself here. But it wasn't unanimous, right. We had two Fed governors that wanted to cut and now you're going to probably come back in September and do a half a point cut, maybe more, depending on what else we see here. Just seems to me if there was data being shared and why wouldn't you at least check in? You know, if you're the Fed, why wouldn't you be checking in with, you know, bls and we don't know, right.

They maybe they had some of this data. We don't know.

Well, Tom, I would. Sorry to interrupt you, but if you had the data, it's that even more egregious.

Yeah, no, I agree.

And, and so the question talking to that, if he had the data, he should have been talking to that on Wednesday.

Right. And I have a question for you and I have a question for people that are listening. Please jump in on this.

There's much smarter people listening than me.

So maybe the people listening and then we can get to you after that is had the jobs report come out last Friday before the meeting, right. What do you think you would have seen happen before at the meeting this last week? Do you think you would have had a quarter point cut? For sure.

Do you think you had to.

I would tend to agree. I would tend to agree. Yes. I would tend to.

How could you look at the, how could you hang your hat on jobs data? Right. And where inflation's sitting. Right. And inflation is not bumping of any significance.

Right.

See where that's at, see that jobs report and not make a move or especially with all the pressure that's going on. And if this is, we've talked about this a bunch of times. Right. I think you get, you know, Powell goes on and on and on and I'm sure he's a fine person, you know, in general, but the position that he's taking to me now seems like at some level he's also kind of digging his heels against the president and against the administration. And I think we talked about this a while back. I think we were in agreement that no matter how you slice it, some of this is political at this stage. And even though they're of the same party or historically have been. But how do you, how could he not have done that?

Yeah, I would. And if you go to the poly market. Right.

So great.

I had all these notes about poly market and what was going to happen yesterday. Well, it's changed quite a bit. But yesterday there was on the December, I'm sorry, the September rate cut, it was at 46% last night, last night when I was looking at it, 46% and it jumped. You can see here this little like, you know, this big up and down here.

Right.

Or right here kind of at the end. This happened obviously this morning at 5am so it went from 5:30 or whatever it was, it went from 46 to 68% belief that there'll be an increase next month or I'm sorry, in September. Right. Which is still almost seven weeks away, I think before the next meeting.

So show me that. Show us that again. The hard to see.

Yeah. So as of last night, the chance of a 25 point increase was 37%. Now the chance again per Poly Market in the betting world is 68%. So it almost doubled, actually. Did double. Almost.

Yeah. And it was as high as, I think it was as high as 80% this morning. Not necessarily Poly Market, but in other, in others.

Right.

So Bob says he's not so sure Powell is a fine person. Bob's calling me out.

Yeah. So as he says. Yeah, it's potentially showing incentive. Zero incentive for growth. It certainly doesn't give enough tailwind. Right. To everything else that we're going to be going through today. But. Yeah, I just, I don't know. I think the thing that is the most upsetting to me on this is just how far off they were and how important that is to the decisions that we're making. It's like, come on, we can get our act together a bit more than this.

Yeah.

And I know there's been talk about having the treasury and the Reserve having more coordination and things together, although I don't know if the treasury had the data is not. Again, I don't know how all this data flows and is this a secret ballot? And you know, maybe we should do some more homework on this before the.

Before what If Jerome Powell would come on the show. I mean, I know he listens.

Yeah, it's a good idea. We always talk about wanting economists on the shows.

Right. You know what we should have done had I known anything about this? I was just texting the other day with a good friend that's been on the show, Sean Dubervack, who's is an economist and PhD economist and should have reached out to Sean this morning.

Yeah, we should get one of those guys and see if they can kind of take us through why this is so effed up. Right. Because I don't, I don't understand it.

Well, look, you know, the, the, I think that the challenge that's going on right now, and we, we talk about this regularly, is the administration has a series of components. Right. And of the things that they're trying to accomplish to benefit the US and the US Economy. Right. Borders, fentanyl, tariffs balance. Let's not say tariffs balance. Trademark to make trade fair. Interest rates, onshoring and manufacturing. A couple others I think go with that. Right. But the interest rate component is a huge cog in the wheel of trying to get onshored manufacturing. And so as we look at this, we have an article later about, you know, a dip in on shoring and, and that's. They want to Drive that with jobs and so forth. So if we think about, if you're a manufacturer, a lot of our listeners and subscribers are, you know, you're in this place. It's like, hey, give me some relief. And even, you know, the distributor side of this is, hey, give me some relief. So that I've got some relief with interest rates, I've got a little bit of stability with what's going on in the supply chain and I'll start investing in new branches or building new factories or whatever it is. And I think with the Fed doing, you know, it's almost right now like the, the Fed is as schizophrenic as the administration is. Ups and downs with tariffs and so forth. The Fed, you know, so it's going to be an interesting day. I think that I haven't looked in a little bit, but I'm sure the President is calling Powell out.

Oh, no, he's already had a bunch of stuff on social media, I think, this morning. Hey, there was a site you were.

Checking your Truth Social account.

Yeah, yeah. First thing I check when I wake up in the morning.

Yeah, very good.

So there's a whole bunch of other news about tariffs, which also is not in the news. Do we want to hit on those first or. Yeah, why don't we.

We want to look at that one, that article in that chart that we looked at this morning. So, you know, there's been such a swing. So today is August 1st. That's when most, most tariffs were supposed to jump back into place. We've had, what was it, Mexico has just been extended. There was an announcement too about some China talks going on earlier in the week, and those were maybe a little bit flat. Oh, here we go.

All right. Somebody who knows what he's talking about.

An economist chimed in. Yeah, why don't you pop that up? Can you highlight that? Good. Our friend Taylor St Germain, who was on guest with us a few weeks back. Taylor's with ITR and, and an economist. So why don't I read that Tom Taylor says, I think the Fed still worries a lot about inflation that will eventually come from tariffs. ITR expects inflation to be much more problematic later this year and into 2026 often takes nine to 18 months to see the tariff inflation impact. I haven't digested this jobs report yet. I'm on PTO today, but of course I tune in to you both even on my days off. What a lovely, what a lovely guy. As an economist, I will completely support your message that these labor revisions are very Frustrating. So there we go. Economist in agreement with us. So we got to get Taylor back. One, Taylor, thanks for commenting. Two, thanks for being with you with us while you're on pto. I wonder if he's back. When I talked to him last, he was heading up to the mountains to go camping with his youngest child for the first camping trip, which I want to say their daughter, 18 months, something like that. I could be way off, but very young child and they were heading up. So I'm gonna be here very soon in near Colorado Springs where Taylor's at. So I'm gonna try and meet up with him. My youngest son just moved to that area, so catch up with him. So interesting time with that.

Yeah, I mean, look, I, I mean we talked a lot this with Taylor when he was on the show. Right. Is that there is an expectation that maybe inflation will be more problematic in the next, as you said, nine to 18 months. But that's not the logic and rationale that they said for keeping the rates the way they are. Right. They did use the logic and rationale of the job situation and you know, they certainly didn't. And what I didn't hear and maybe, you know, I dismissed it, but I don't recall Powell saying anything. Hey, we're looking out in this nine to 18 month horizon. We're looking out in the next, you know, couple of months horizon or even to the end of the year.

Yeah.

And anyway, we have to get Taylor.

Back on and you know, I will throw this out and I'm hoping Taylor's still there. And some, you know, sometimes people make a comment on the show but they're up moving about or doing something and they're still listening, but they can't comment again. But Taylor's still listening. My, you know, kind of question that ties into all of this is what would happen? Right. Because we, we've talked about this is what, what would happen if we did a quarter or even a half a point dip and we needed to readjust that in, in December.

Yeah, yeah, yeah, right. Well, I'm sure they could say, oh, politically that would be. Or you know, from a market perspective that could be a disaster. But I don't, I don't know if that would be true or not.

Well, I, you know, I think, you know, early on Powell was. Who was it? What was that? Not Bernanke, who was the Fed chair in the, was the 80s. I think that just really botched.

Greenspan.

I don't think that's who it was. But anyways, he kind of has gone down in history as you know, one of the worst Fed chairs of really botching some things up. And you know I've heard talk over and over again about you know, Powell's trying to avoid that but oh man, he's at risk I think right now. So I guess my big question would be to Taylor if you're still listening or others that might have insight is what would be the major ramifications of doing a cut and then watching how things are impacted. And I guess the big component of this too that I think we've got to see is with these trade back to our tariff discussions right further discussions with Mexico but the EU is deal is done, the Japan deal is done, the South Korea deal is done.

Right.

We've got some, some big things happening with India but that doesn't our trading with India isn't the same as it is with these other other countries and I think so I think we've got in as uncomfortable as things are with that's cool. You're sliding through this. So if you're watching on the show right now, what Tom is doing is he's showing through kind of clicking through a chart of what was originally announced on Liberation Day on April 2 versus where things are at that was announced in July and it's going into most of them going into play today August 1st. But EU, Japan, Mexico, still some work being done on that. The Vietnam deal is in place. Vietnam being a proxy at some level for goods coming in from China and then progress on talks with China. And this is just one guy's opinion but I would throw out the idea that we should probably see some balancing of the instability that goes with what's happening with tariffs because the big ones are other than China and China. China's going to be what it's going to be. And and I feel pretty confident that something reasonable is going to come out of that. We should, we should see some balancing here.

Well I think here's what's going to in my humble opinion, what's going to happen right the April, the August 7th date got moved out a week so that's a week from yesterday. I believe that's just you know again creating that impending event to get everybody, you know, running around trying to quote unquote, submit their deal if they will. As you said, Mexico is on a 90 day reprieve because they're working through stuff. Canada is kind of its own animal. I think that'll but I think the biggest challenge is over the next and looks everyone's not going to get resolved in a week. So he'll keep moving it out. Then it'll be the 15th and it'll be the 30th and whatever. My guess, it'll get moved out maybe another month. There'll be a lot of scrambling back and forth. But I do agree with you. I think as we go into, as we go into September or, you know, Labor Day and the end of the summer and going into the fall, I do think we will see stability. I think right now it's like who are we talking to about this? Just this week about. It's so hard, right. Even in your systems and your pricing and your systems to know the tariffs change so quickly you can't even keep up with it and your ERP and your other systems that are there. So there's like this administrative overhead that's constantly taking place. Unfortunately, I think there's going to be a lot of that over the next month. But I do agree, I think it'll start to settle out.

Yeah, we have two articles. Well, we have an article today and then I read another article this morning about a major publicly traded distributor talking about some impact to tariffs and a manufacturer. So we'll come around to that. But I do think we should see some leveling and some balancing. First off, Bob made an interesting comment. Depends on what will be done with the tariff dividend, so to speak. Right. And there's some big dollars coming in from those tariffs already. So if it goes into the pockets of a normal American, it could impact inflation. But if it's funneled to decrease the debt, then inflation should be kept low. And we talk every week about the debt and the big debt payments coming up and you know, we've got to go do the math. We talk about it every week that we haven't done. The math is what would a quarter point interest rate reduction do to the debt payment. Yeah, right. And so Taylor made answered our question there. He said it would be great to see a move lower here in the short term. I don't see the harm in doing that. But as you know, the Fed is always late to raising and late to lowering. It's been that way for 40 years. But have to be careful because of currency implications can weaken the dollar quickly if we lower rates. Dollars already struggling this week and even more so this morning.

Well, in the bond market is down too. But yeah, I think that's a great point. Right. There's a lot of potential consequences with a roller coaster, you know, up or down. So I can understand that. You know, hey, raising this week or lowering this week and raising in three months and all of that can certainly have downstream consequences and ramifications as well, which I think Taylor is pointing out really well. Yeah, but I, it's. Anyway, I think that the next two months are. Here's what I think here's. You heard it here first, right? Here's my project.

Yeah. This is being recorded. Just other people are hearing you talk to a couple. Only a couple.

A couple. Couple. But you know, so in September when the job reports come out, there'll be another revision upward. They're going to be like, oh, there was actually more jobs created than we thought in, in June and July. That's my first prediction. Then what's going to happen is, and this is not popular is I don't think there will be a rate cut in September, I think because the job will get, it'll be the same rhetoric and well, we have to see how these tariffs are playing out and all that kind of stuff. Meanwhile, as we, we didn't really talk about this, but the appeals court started yesterday listening to all the arguments about are they, is this tariff thing legal with the way that they're doing it and so forth. That's not supposed to be settled in August. It won't. It'll end up going to the Supreme Court and basically we're kind of going to end up being right back to where we are. I think in the next, by the time the next, the next Fed meeting actually comes back into play, other than I do think the tariff thing, at least in terms of what they will be, will be settled out as we, as we just talked about. So then you say, well, what happens in October and December or November or whatever. Too early to tell. I just think that it'll get upwards and it'll be back to the same rhetoric.

Why do you think that?

Because it's just the way things seem to work with this job thing. Right. Big drop downwards and then big revisions upward. But I do agree in this. Bob just said this. A 25 basis point lowering would, would create the right signal. And I do agree with that. I, I want the rate cut. I'm not, I just think this is how it's going to play out. That's my prognosis.

So.

And you know how always I'm wrong on most of these things. So just do the, you know, if you're going to bet on polymarket, bet the opposite of whatever I say.

You might get a steak.

That's right.

What's our, what's our bet this year it's for tacos or a burger.

I had said there wouldn't be a rate cut before September, so. Which I think I've now won that.

Okay.

And that was for some tacos. So you can buy me tacos for lunch and I'll buy you a steak for dinner. You got it.

Sounds fair. So you. Let's, let's talk about what you just said though, and let's unpack that a little bit. If you're correct, and I'm going to throw this out to the audience as well as you, if you're correct and we see, if I heard you correctly, September, we see uptick in jobs and say, oh well, we were kind of confused and now we've got an uptick in jobs.

There'll be a revision. Right. So the July one will be revised.

Yeah.

Potentially substantially. And June. Right. Because they could go back and revise June and July.

So assuming that were to happen and we start seeing maybe a little more stabilization. Let's just say the China deals almost done. Related to tariffs.

Yeah.

Mexico's in place. By then it should be. Right. We've got a few of these things and we still don't see a move in interest rates is what you're saying.

That's what I'm saying. Because the inflation numbers aren't going to change all that much in the next couple of months. Yeah.

Yes. A. It'll be a basis point change.

Yes.

If that's the case, it's. Go ahead, go ahead. You're laughing. Put it up there.

Tacos versus steak. It's a Trumpian trade.

If I ever saw a Trumpian trade. I don't know if I like I'm going to take the compliment regardless of who it's related to. How's that? So thanks, Bob. Yeah, that was. I made the right move on that. But I think this is an important point though. Right. If you're correct in, in I don't know how somebody could argue that you. It's not completely possible. It goes back to what I've been talking about off and on for the last few years is do we still. In 2025. August of 2025, in Q3 of 2025, are we still using the right metrics for how we analyze and evaluate what the interest rates are and how the Fed responds to things?

Well. And metrics and obviously we just talked about accuracy of data. Right.

You know, but are they even the right metrics anymore? You know, if you look back to what bessants have been Saying what was he saying? 3. 3.

3, 3. Yeah, yeah. Right, right, right.

3% inflation, 3% GDP growth. And what was the third?

I don't remember. But.

Right. So, and I'm, and I'm not saying it's three.

That was a debt ratio, but I don't remember offhand what it was.

Yeah. But anyways, that's, that's just my big question is we've got, and it just seems, and I think this is, this is what should frustrate people is going back to what we started our discussion with today is if there is a government agency, the Fed, and you got another government agency, Bureau of Labor Statistics, and one of them is relying on the other one so much, one, they should have their data act together and two, if they're going to do something like you knew there's. And just going back to this point. Right. Because we were both frustrated with it, is you have to know that BLS knew these numbers were going to get revised before the Fed meeting this week.

I would think so, yes.

So maybe there's some just adjustments in how, how we communicate amongst departments. Are these the right numbers that we work with and so forth. So anyways, that's the key.

Look, I agree the thing needs a transformation, right. It needs more than a digital transformation. It needs a transformation. There's no doubt about it. And I know there's been talk about, as I said earlier, about the treasury and the Fed working closer together, coordination better, those types of things. But yes, I would love to see more of a, a less archaic model.

And you know, again, you know, no, no economists on this show today other than someone that's been commenting on some things. But I just go back to the discussion on this that we've had a hundred times. Is the 2% number, is this random number that came from, you know, a government official in New Zealand that was being interviewed in a hallway after a, you know, an economic forum meeting or whatever it was. Right. Oh, let's use that. Well, maybe there's a better way to do it and a better way to look at all these things. Let's shift gear off of those that because we're kind of talking about the same thing in circles there. But I do want to go back to. You made the comment about. And I'm, I'm asking a question about this because I, I'm not sure I understand it fully is, you know, you were commenting about the, the courts evaluating whether and likely it going to the Supreme Court because at first we had a court, lower court say no, Trump doesn't even have. Yeah, Trump doesn't have the authority to even use some of these previous acts or I guess laws or acts for his authority to implement the terrorists. Right. So first court, lower court said, yeah, you're right, he doesn't. Peel's court said, no, no, no, hold on. He does now. That's being evaluated. Again, I have to look at this, and this is, I think, just from a common sense standpoint that would say if, if there was a way of this, this ultimately being struck down and that he doesn't have the authority to do that. Why is anybody at the table negotiating? These are going to go through, Right?

Well, as we've seen. Right. There's other options. Yeah. So there's other.

Those options must be very strong. And if those options are very strong, why are we spending any time even thinking about or wasting the time of the courts in talking about that?

Well, I'll give a. What I believe is a politically correct answer. I think that the courts want to. It may not necessarily impact what Trump is or what is going on right now, but I think what they're trying to do is put law on the book so that. How would this actually play out in the future if a president wants to do these types of tariffs? So I think they're trying to set the stage for the future, maybe. And some of these other things may prove to be right. Some of these other, you know, I won't call them loopholes, but angles that could be used. Who knows where those will end up as well. So I think a lot of this is setting the stage for the future rather than necessarily determining what's going to happen right now. Good.

Okay. Well, let's see what does come out of that. I think that's, to me, it's like, it's, it's noise because all this stuff is happening and we're collecting the tariffs already.

Yeah, yeah.

Right. So what do you do?

I mean, it's happening. These deals are in place. They're happening. Yeah, right. They're going to continue to be in place. Clearly the country, clearly the countries believe that there is. They better make a deal or there's going to be potential issues, regardless of the legal. Legalities that are backing that up. All right, let's, let's, let's move ahead.

What do you want to talk about?

Do you want to move out of economy or do you want to hit gdp?

Oh, God, no. Well, just, I mean, maybe just quickly. Right. Do you want to talk about that briefly?

Yeah, I can just. Because I found it interesting a little bit. So this article is talking about the GDP increasing to an annual rate of 3%. Right. Which is a increase of the contraction.

That existed in the Q2 gross margin by 3 points as sales fall. So interesting article that goes with that. There's a lot of kind of further discussion about what's going on at Stanley, Black and Decker. Great company. Great. Stanley Black and Decker is one of the things I'm really appreciative about them is, you know, we, we support our friends at the Industrial Supply Association, Brendan Breen and his team there. Brendan's going to be on the show again very soon talking about their fall summit. But we are at Lead Smart and I have always been a big supporter of industry associations and trade groups that are really trying to do their best to help the industry grow. ISA is that in the industrial segment. And Stanley, Black and Decker does a phenomenal job of their work and supporting ISA and I'm sure other groups as well. So hats off to them about that. So they said there was an $800 million in projected impact this year related to tariffs. I thought that was, that was interesting because that's offset by Grainger, right. Who's a distributor of I'm sure Stanley, Black and Decker products as well. They posted higher sales but feels the effects of tariffs could be a related factor. But their number was, when I look at this, it was a fraction of a percentage point of margin impact at Granger. I'm just trying to look at this real quick. Company that sales, da da da. GROSS Profits rose 3.6% year over year and gross profit margin, however, came in at 38.5. Boy, most distributors would look at this and like to be intrigued by Granger's 38.5% gross margin was an 80 basis point drop. So 8/10 of a percentage point was their drop of, of margin in this segment. So Stanley, Black and Decker announcing some pretty significant impact to their, their overall business. Granger showing something as a. On the distributor side, you know, less than 1% of an impact the tariffs of having. At least at this point.

Yep.

Okay, so good. Want to roll into E commerce and marketing?

Let's do it.

All right. How about unlocking growth through strategic personalization from sales and marketing management takeaways on that for you.

Yeah, you know, so what the article's talking about, right, is how do you rise above the noise from a marketing perspective and you know, capture buyer attention. And so they're, they're talking a lot about the importance of personalization and I was interested. I was thinking about this because we're seeing this actually with a few.

You're not looking at our handsome faces.

You want the newsletter that doesn't have the news that we actually talk about.

You know what? I think this is the first time that this has been as, as dramatic of that. Right. We've had, we've had plenty of episodes and we're at number 152. Right. Three coming up on three years and which just still astounds me that we have been doing this this long and that people are still enjoying and commenting and calling me Trumpian. This is very good. The, the, excuse me for that. This, I think, was one of the first times we've had as dramatic of a shift of what we needed to talk about today. Right. So, but then again, we, we publish a newsletter every week. It's called around the Horn and Wholesale Distribution and Manufacturing. If you're not getting that and you'd like to just three simple ways that you can get that. Just search for around the Horn and wholesale distribution on LinkedIn and you'll see both the page for the podcast and the newsletter will be there. It's also, you can access the newsletter through the lead Smart Technologies LinkedIn page. You could send us an email to helloadsmarttech.com we'll get that out to you and get you added to the list right away. Or you could go to the website for the podcast, which is www.aroundthehornpod.com. so again, if you're listening in on Apple, Spotify, whatever it might be, you're not seeing the newsletter that we have here. Before you jump ahead, Tom, there is an article here from CNBC still in our economy and supply chain segment, China's July manufacturing activity contracts more than expected. Common sense would say that right now. Right. But it was interesting in that article, it said that the Chinese government actually commented on the fact that they were not going to do anything to prop up the economy at this stage. So I thought that that was kind of interesting. It says that they signal it will not launch broader stimulus through targeted subsidies, so on, because that's one of the risks of negotiating with China in this setting is they can manipulate the currency. And they've done that over and over again. And what they're saying so far is they're not planning to do that even though they've got the manufacturing slowdown already.

So they're probably less imports. Right? You know. Yes.

Well, and they're boosting their exports to other countries right now as well, which is what you know, and that's a big part of what the administration is trying to do. Right. Is to make sure that was hence the deal with Vietnam that happened so quickly because you might have looked if you didn't, you know, peel the onion a little bit about Vietnam. Like Vietnam, why is this such a big deal? But when you've got so many of the Chinese, you know, shell companies and so forth that are there, it's a big issue. So anyways, let's jump into manufacturing distribution segment of the newsletter. Stanley Black and Decker. This from Auto Distribution Management are good friends there. Stanley Black and Decker said tariffs cut Q2 gross margin by 3 points as sales fall. So interesting article that goes with that. There's a lot of kind of further discussion about what's going on at Stanley Black and Decker. Great company. Great. Stanley Black and Decker is one of the things I'm really appreciative about them is, you know, we, we support our friends at the Industrial Supply Association, Brendan Breen and his team there. Brendan's going to be on the show again very soon talking about their fall summit. And but I'm, we are at Lead Smart and I have always been a big supporter of industry associations and trade groups that are really trying to do their best to help the industry grow. ISA is that in the industrial segment. And Stanley Black and Decker does a phenomenal job of their work in supporting ISA and I'm sure other groups as well. So hats off to them about that. So they said There was an $800 million projected impact this year related to tariffs. I thought that was, that was interesting because that's offset by Granger. Right. Who's a distributor of, I'm sure Stanley Black and Decker products as well. They posted higher sales but feels the effects of tariffs could be a related factor. But their number was, when I look at this, it was a fraction of a percentage point of margin impact at Granger. I'm just trying to look at this real quick. Company that sales GROSS Profits rose 3.6% year over year and gross profit margin, however, came in at 38.5. Boy, most distributors would look at this and like to be intrigued by Granger's 38.5% gross margin was an 80 basis point drop. So 8/10 of a percentage point was their drop of margin in this segment. So Stanley Black and Decker announcing some pretty significant impact to their overall business. Granger showing something as on the distributor side, you know, less than 1% of an impact the tariffs of having at least at this point.

Yep.

So good. Want to roll into E Commerce and marketing?

Let's do it.

All right. How about unlocking growth through Strategic personalization from sales and marketing management takeaways on that for you?

Yeah, you know, so what the article is talking about, right. Is how do you rise above the noise from a marketing perspective and, you know, capture buyer attention? And so they're. They're talking a lot about the importance of personalization. And I was interested, I was thinking about this because we're seeing this actually with a few Lead Smart customers right now who are using Lead Smart and the CRM data to drive their marketing actions. And I realize what they're really doing is actually personalizing, trying to personalize their marketing more. So the misconception with personalization is it's all about personalizing to the contact. Right. So, Kevin, I gotta, you know, hey, Kevin, and I know you like sailing and doing things like that. That's what you think of. But in B2B, personalization is way beyond that because not only are you personalizing to the individuals you're talking to, but you're into personalizing to the account and the customer that you're talking to. Right. So the account can have information analytics and data about the account. About the account itself.

Yeah.

That can be used to actually personalize and make your messaging more relevant. Right. Because at the end of the day, why are you personalizing is you want to be more relevant, and as you're more relevant, you get more attention. Right. That's really the whole purpose there. So, yeah, we're seeing more of this where. And I've seen this with some of our customers where they're using their CRM data and the data that we have in Lead Smart to build audiences, but not audiences so much based around the contact. Contact information, but around the account information. So therefore, they're targeting their messages based on what the account is buying, maybe what they're not buying, maybe what they should be buying. Their, you know, their. Their categories, all of those types of things, and then taking that and combining it with the individual that is receiving the actual communication. And this personalization is not just through email or things like that. This is. Could be done through any sort of sales action or sales motion, a personalization. And anyway, that's what this article was talking about. But it was interesting, as I was reading it, to see we're seeing more and more of that at the account level rather than just the contact level.

Yep. Well, and. And it's interesting. It just makes me think we were. Both of us went To a roundtable discussion that Bob Britton, one of our friends that's here on the show, made some comments all about AI.

AI Roundtable discussion.

That's right. His favorite topic. But that was a nice group that got together. But there was, you know, it makes, just kind of makes me think about how people are typically tracking website traffic. That's at an account level. Right. And then that roundtable, there was some discussion about some great tools out there. I actually want to dig into a few of those to even understand how they work a little bit better. You might know, but the idea of being able to identify who was on your website. Now almost all the tracking tools out there can say based upon your pixels and so forth, can say, this company at this location, all tied to IP address stuff, this company was looking at these pages on your website. But now when we can narrow that down to the person. Right. You were just talking about account flipping, account data and personalization or an individual data as well. And I think this speaks to it. Here is, you know, some of these tools now can really let us pinpoint from who was on our website what they were doing, which is important when we can see them on our E commerce site and then we know who it is and they're already in our system. Because typically we often think about, you know, from a website visit, tracking is. That's a new lead.

Right.

But now when we can get that data about who it is and because some, you know, sometimes you don't have people logging in because a lot of what distributors are doing is they're trying to track this. If they're trying to do attribution and tracking what people are doing on their website, it's from somebody that's logged into their account. But there's that whole component of the people that aren't logged in or aren't necessarily yet a customer. And when you bring all of that together using some of these tools, I think you get the maximum, maximum opportunity.

But I think, you know, and Bob's saying here, right. People sign contracts. Not companies, but companies or committees. We see this all the time, either make decisions or influence decisions. Right. So chefs in the kitchen. Yeah. And so there may only be one individual or whatever the signs the contract. But there's certainly been a lot of influence. I mean, we've worked through a couple of those this month. Right. Where just the amount of.

I don't know if you can see the gun to my head.

Yeah. You said you've been losing hair. So I figured out.

Right.

So. So the. So Personalization. I agree at the end of the day there is somebody who signs a contract, but the personalization to be able to speak to a larger group and then be able to incorporate the relevance not only of what they care about, but the relevance of the company again, hopefully gets the ability to get that influence and move the groups that are there. So.

Yep. Well, this kind of ties a little bit, Tom, into a couple articles down there. The was it chief chief marketer.com invest in full buyer buyer life cycle improve AI discoverability in 2026. And they were going back and talking about a forester, some forester guidance for 2026 for B2B marketers and about buyer life cycle and planning with that and identifying and understanding more of the buyer behavior and using the technology that's available to do that. So we talk about this at some level pretty regularly. But I think this Forrester research is very helpful as well. Yeah.

And it goes, right, it's to their point, right. You're not just getting a lead and then throwing it over to sales. You're trying to nurture not just the individual, but the committee or the group or the people through the buying process all the way through kind of the yellow brick road as I call it.

Forrester references it as owning the complete buyer journey.

That's right. That's right. And then orchestrating that. Yeah. Well, and then if you think of personalization, you would potentially want to personalize, quote unquote, all throughout there to make yourself as relevant as, as possible through that journey.

Yeah, the. It's interesting we as we're talking about this, you know, we were just together a few weeks ago in Florida at the affiliated distributors at their, their large buying group, had their E Commerce and marketing summit. And I was talking to a few different people and they were, you know, we were, they're talking about, you know, lead, smart channel, cloud, our, our product. And you know, we think about this as we historically think about, you know, we work have this one on one relationship that a salesperson has and with a company. And distributors are typically trying to gain a broader insight to what's going on. And now we see all that with the growth of E Commerce and so forth. But you know, I was describing to some people and I need to do some writing about this, but there's really, you know, at least three buyer journeys, Right. You have the buyer journey, if you think about it, the buyer as an account. You have what you do with them in person or on site or over the phone. Right. You have their E Commerce Journey. Right. Which is very, very important these days. You have a marketing journey that they're taking. And what we do with Lead Smart Channel Cloud. Right. Which is why we call it Smart CRM is we bring all of those journeys together to be seen on a single platform. And then using the AI tools we have, like Genius Feed and other tools that we have that can take a look at that across the board about what is our customer doing and then really helping us target how we want. And you were talking about some of our customers earlier who were using all that data to kind of say hyper target folks and really understand that journey. But if we only want to look at a customer through traditional, as an example, CRM or ERP data, we're getting one view of a multifaceted journey. And what we really need to be thinking about is what is there. And we, we have a whole area within Lead Smart channel cloud called engagement. Right. We want to look at what is that, either the contact or the company. What are they ingesting of us from us? Are they. What are they doing with our email campaigns? Are they coming to our events? Are they engaging in website content, video content, whatever it is, and then what are they doing in our E commerce platform? So when we start thinking about the insight that we get to our customer journey, if we're looking at it from three components of our traditional engagement with them, we'll just call it in person, inside sales, outside sales, customer support, those functions, our marketing function and our E commerce function. We see three journeys and now we get this deep insight that this Forester research is talking about some of the other things that we've talked about.

And I think the middle one is more than E commerce, it's digital. Right? It could be. It's more of their digital journey related to. Yeah, E commerce.

Yeah. Which can kind of almost tie that marketing component that I talked about as well.

And there's definitely three overlapping. It's a Venn diagram with three.

Well, and that's the point, right, Is when you understand all three of those now you have the capability of one, serving them better ads and, and, and harnessing where the opportunities are, and then two to go with that is you're understanding them so much better that you can improve their experience and customer experience is critical. All right, let's go talk about some technology, Cyber Security and AI. So this week, earlier in the week, ChatGPT launched their new a do it all agent. So what are your thoughts? Let's talk about it for a moment first and then let's Go look at it. What are your overall thoughts and take on it.

The jury is still out for me as to how effective it is, so. And I guess rather than trying to explain what it does, I think, yeah, showing a picture and I can. Yeah, I'll talk through it for people that are listening is the best way to go.

Yep.

But it shows. So basically what happens is if you go into agent mode in ChatGPT, I think it's only available to paid customers.

It is.

And you ask it all levels of.

Paid, which is good.

And what I'm going to do is I'm going to ask it a question. I have to go to Baltimore next week, the week after. I'm going to ask it to see if it can find me flights to Baltimore. But what it does is it brings up basically a virtual machine.

We're still seeing the newsletter if you're.

Yeah, yeah, I haven't. I haven't moved it over, just FYI. There we go.

So what we're looking at on our screen now is chat GPT 4.0. It's in. You're in Agent mode already.

I have not gone into Agent mode. Okay. So you know what? It doesn't work. When I click on the stream yard thing, I actually have to go over to the browser.

I was like, I'm seeing your browser fine here.

No, it's fine now. So you go into Agent mode and you'll see here it says, please find me flight options from SBA Santa Barbara Airport to Baltimore on August 11, leaving SBA in the morning. I prefer United and American, but please show me lowest fares. Now, this is a pretty.

He doesn't mean that he's flying United or American.

Just playing.

Go ahead.

Okay, so if I click this, okay.

Gonna get it started, right?

It's gonna go thinking, and you're gonna see a little box pop up here. See, it says, setting up my desktop. So what it's basically doing here is creating a little virtual machine, like a virtual browser. And then basically, okay, you can see it's starting the process now, where it's now going through and kind of emulating what a person would do if they were looking for flights. Right? So it goes to all the, you know, Expedia and Kayak and Google or wherever else that they're going here. And it will start actually going through. Okay.

167 bucks. That's awesome.

Yeah, that seems almost too good to be true.

Get that one. Tom, hit pause. Go book it.

Yeah, go book it.

Because if you could see the cost of Some of my flights this month, we need yours to be cheap.

So you can see here, it's now going to Google, it's now putting in the flights. It's actually typing it. So it's doing what I would do or you would do if you went to an online site to actually do this. It's emulating and going through and trying to make decisions as it goes through here.

Now, Tom, you could also ask it to do that every day and get you updates to it. So it's tracking some flights as well. Right.

I don't know that you can schedule it to go on a recurring model, but maybe it could. I don't know.

I think that was part of the idea of the agent. Because if, if you can't, it's not really doing much for you. It's just doing a bunch of things at once.

I don't know how. I don't think currently it allows to like set up to do, to go recurring and come back and. But I'm sure that will go there.

I'm sure I was looking at one the other day where I could set it to go. Look at my emails and we'll talk about all of that in a couple of minutes as well. Where it could do it each morning at a certain time. I'm. I'm hoping. I. I don't know if he is. He hasn't come commented earlier. Brian Hopkins was with us and Brian's with Distribution Strategy Group and he actually hosts a podcast with Brooks Hamilton and that they talk about all the different AI tools that are available for distributors. And I'm guessing Brian has played with this before. Brian does a ton with a lot more with Claude. So if Brian, if you're here and you played with this, chime in.

But you know, and we won't. I won't sit here and it could take 15 minutes for this to go through and do its thing. But think, you know, how many times have you ever gone, you know, you have to take a trip, you start going to these websites and an hour or an hour and a half later you're still poking around. Right. I mean, I don't. Yeah, right. And oh, the seats are bad on that or the flight, you know, the connection times are bad or.

So now that you say that, do me a favor. Already done this. What would be cool is to ask it, can it look at flights that has exit row aisle seats available?

Yeah, I don't. I would have to stop it and redo it.

But my answer, I might try that later.

I might Try that later. But so, yes, the more criteria you give it, right? And then what I did is I said we'll just let it go, do its thing and then come back 15, 20 minutes later.

Right.

It doesn't mean that it's going to book your flight for you and put in your. But you're probably going to have a pretty legitimate set of options that you've saved yourself, you know, the 45 minutes or an hour poking around on different sites and checking the connections and the, and the seats. As you can see here, this is the type of thing that we would be doing on our own. So anyway, the agent piece, in addition to this sort of action piece, it can build spreadsheets for you, it can build presentations for you, it supposedly can analyze your inbox. There's a lot of things that. Well, I have found in my, in my. And I've not tested a lot, but I found that it's been a little clunky. But you know what? It's only going to get better. Right.

So, yeah, so a couple of things, right. So as I see what you've done here, really what it's doing on your behalf, right. In the three or four minutes it's been going here today, is it's looking at all of the sites that you might go to. So it's looking at Expedia, Orbitz, Kayak, whatever it is, along with the airlines themselves. And it's consolidating that data to give you good results. I actually need to make some adjustments to, or actually book another flight today.

So I'm probably just finished here.

There you go.

Okay. So I've got these choices at, you know, these prices. So it wasn't 197. Pardon?

Still good prices.

That's only one way, though. So that's not all that great, but. Oh yeah. But anyway, I mean, this is a big head start right over me. And you're right to your point, if I added more like seat selection, possibly asking it about hotel.

Right.

I mean, there's probably a lot of other things that it could, could and would have done if I asked it to do that.

So it's saying. Excuse me, it's saying that it can now go do. You can connect it to your Open Table account and things like that and it can go out and book restaurants and so forth. Two things I want to kind of talk about. I'm going to hit the first one. That's the positive side of this. We've talked and Brian just said. And he's one of my go to sources on this kind of stuff. You know, Brian's a former Grainger executive, a former executive at lots of different distribution companies and talk about a migration and I'm saying this with all complimentary hoppy is this is a guy that has gone from being an operations executive in wholesale distribution to truly one of my go tos to see what's going on in new AI tools. He's really doing some fun, neat stuff. He's shared some prompts with me recently. If you don't follow Brian on LinkedIn, I would suggest you do one great human being. And although I think he just canceled a call with me for the second time today, so I think he just says he wants to talk to me. But, but Brian's a great resource if you follow what he's posting on LinkedIn. And then obviously Distribution Strategy Group, we use a lot of their data on this show on an ongoing basis and good personal friends there and quality, quality of data. But we, we were talking Tom, I'd like to almost go back and you know, use our AI search that John Taylor, our editor and producer puts together that we can search through the show and find out when we first talked about this but you know, we, we talked about probably a year ago the idea of the, you know, literally being able to do voice commands to your phone that says to your point, you know, last minute, I need to be in Baltimore on the 12th, I need flights, I need a car, I want to stay at the same courtyard that I stayed at last time and I'm having dinner at McGuire's in Annapolis. Can you. And it will go get the flights, get the dinner reservation, get the hotels or alert you to any concerns. This is just a major step forward. And Brian was just saying here, you know, it'll get better fast. And I believe we're there. Here's the rub or the challenge, right? If you were to go back into that Tom, and I'm going to ask you to do this and throw another prompt at it. So go to do maybe a new chat.

Do you want a new Chatter?

I think you should do it with a new maybe. Maybe it's. Brian just says yes to all those compliments. That's what I'm going to say. He says yes. Those are true. I think he means yes. It's going to get better fast and we're going to be able to do all of those things I described. But this is unrelated to your trip. So whether you want to start a new one or just to go to another task, it doesn't matter to me but the say I'd like you to maybe just say can you access my Outlook email and calendar?

I haven't. I haven't. I haven't connected any.

I know you haven't. This is what I want to talk about the access my Outlook email and calendar and give me every morning at 8am a recap of my critical emails and critical meetings. Something. Something marginally close to that Whatever you come up with this is either really insightful for people or we're losing guests fast.

Yeah right.

Okay so it's saying it can't directly.

That's because I haven't connected mine Right. But had I connected mine So I.

Haven'T either but it came back different and it told me it could okay and it said all it gave me a list I think I sent you this screenshot I'm going to look at this really quick if I can find this I want to tell you exactly what it told me. I think I sent you this earlier in the week. The problem is I have to look through 972 teams chats. Here's what it told me. It says you're about to control Chat GPT's browser. ChatGPT won't take screenshots only you can see the info. Your browser session will be saved and this may put your data at risk. So by giving it access it was asking me for access to my browser because what it said earlier in that chat was it was going to open my Outlook in a browser not on my computer and now I was giving it access to my browser and that my browser session would be changed saved I should say and that says in red it says this may put your data at risk. Signing chat GPT into websites can expose your data to malicious sites. Yeah so that's what you know in. In I, I think what I want to do with this and we haven't set up the I sent a note to our365 administrator the other day we haven't given within lead smart copilot access to Outlook yet and I think that's the route I want I want to go in this versus Chat GPT because what it was like I said what it was saying is it's telling you it can't but what it told me was it's going to go open it.

In a browser and again there's a bunch of connectors as Brian's saying Dropbox and Google Drive and there's going to be more and more connectors that are going to be made available to this as it goes forward. I would recommend don't connect things but just get familiar with it using some of the simple things that are there. Bob pointed out.

Right.

I used to call a travel agent to do all this stuff and they'd get back to me. It's exactly what it is. Basically it's a digital travel agent that is, you know, the travel agent would lay out your flights and what are your options and which one do you want and all that. It's basically doing a lot of that same thing but obviously at a much more broader sense. So yeah, there's really nothing that could go wrong with it. Accessing your email and your browser. So. You're right. I'm being way too conservative. Maybe I should just hook it all up and go for it.

That's funny. I would expect nothing less from our friend Bob.

Yeah.

You know what's funny? I'm gonna just. You just talked about Bob Tyba travel agent. You did too. Ran into it at church recently. An old friend couple that we've known for forever. I hadn't seen him in a while and the wife is still a corporate travel agency agent and as busy as she's ever been.

Yeah. Could see that.

So she has both some very high net worth people that she works with and executives and companies that she still works with and she manages everything for them still. Which is interesting because she probably uses.

She probably just puts their stuff into the agent and does it.

Right. The. I should ask her about that. The. But I mean I'm trying to let you know an assistant in our company do my travel and I can't psychologically turn that over because I've got. There are just certain things I do when I travel and I've. You know, but there will be a. There will be. Rather than me letting a, an. An assistant or somebody in the company do that for me. Very soon I'm going to be able to let an agent go look at my travel history and come back and tell me what it believes. My, my travel patterns and. And seats that I like and airports that I prefer and times that I like to fly and it's going to probably give me more details than I even know about my travel habits in that setting. So. Very good. Let's. As we kind of start to wind down a little bit today. Thanks and thanks for bringing that up and showing that. Tom. I just think to you, your point, to Hoppy's point on this, we're just very close to a place and I think the security component will be taken care of. You know, we'll get to a spot pretty soon where we're going to have a very, very far more connected life. I think what we're going to also see very quickly too, you know, and we've been talking about, you know, even language models that, you know, a business could have their own language model, small, unique language model. And I think we're going to have. And you know, it's funny, Apple is so far behind and kind of failing in the, in the AI race with everybody else. But you know, the idea is that I'm going to have Kevin's LLM on my device, right? And my health recording ring and my Apple watch and my computer and my online activity are all going to be fed into that. And it's just going to make my life easier for when my humanoid robot is washing my car.

Speaking of that, do we want to wrap up with the humanoid robot?

You want to show that? Can you show that?

I did, I brought it up.

Awesome, thanks. So do you want to talk about it? Yeah, let's talk about it a little bit. So, you know, there's just some great movement happening with humanoid robots. One of the, one of the companies and I just can't remember their name. It'll pop up when you bring it up. You know, just real quick here, Brian was just making another comment about some of the things Perplexity is doing as well. And Perplexity has launched their browser and so it's, it's pricey. But you know, you and I have been talking about this a lot lately regarding some other projects that we're involved with. But you know, these AI tools and obviously ChatGPT is, excuse me, Google is in a great spot because they can integrate Gemini into Chrome and so forth and we'll see what Microsoft's able to do with Copilot into their browser. But what we really see is Perplexity, you know, launched and OpenAI and ChatGPT have announced that they'll be launching their own browser soon. You're already doing most of your search in, in ChatGPT. I tend to use Perplexity because I've got it kind of set up and it's really fast to do things. But there's a lot of discussion that Perplexity is kind of only hope for long term success is to have good success with this browser. But this browser now that it's going to be able to do searches and purchasing and access all kinds of other things within your business. So the idea behind that is powerful. This I just wanted to kind of digress there for a second and cover that. But as we. We talk about humanoid robots before you do that, Tom, we've been talking about it a lot. I. I made a little. A bet with our friend Max Meister in, In Munich, Germany, and he said 2030, before we would have a humanoid robot in the household. I'm saying 18 to 24 months. I'm probably wrong. It's probably 24 to 36. But every month it seems like we're seeing. In fact, sometimes it's even more than that. And so why don't we take a look at some progress that's been made on what we can see here. So if you look on your screen now, we have a humanoid robot that's got a pressure washer in someone's driveway. There you go. Hit and play.

I turned off the sound. It was.

That's great. It's got a soapy water and it's funny. There's Chinese text on the screen. But that. Cannot imagine that that's a Chinese home because I think that is very much suburbia America. But yeah, it's. It's. Okay. So it's holding a trigger and it's, you know, this humanoid robot. But now it is wiping the windows down. Right.

I like the cord there. I don't quite understand that. But is that like a lifeline or is that like the actual plug that the thing's plugged into?

Yeah, I don't know for sure. So. But now it's sitting in a chair by a beautiful shiny car. And this isn't to mean that this is what you're. And that's. I think it's. The number was sub $15,000, but it just. The conversation is much like as we were talking about other AI components earlier in the show today. Right. And it just. Things are moving quickly and the idea of. And Bob made a comment. I said, I think that's, you know, very reasonable comment. You know, how is your, your robot washing your car any different than automated car washes? For me, you know how it's different? I'm watching the football game or I'm at my desk getting other things done or enjoying a nice lunch with my wife. I didn't have to go to the car wash. I didn't have to.

It's. To me, it's valuable if after it finishes the car, it mows a lot.

Well, that was exactly where I was heading, Tom, because that's exactly the point. Where this is right, is that's what happens is maybe it goes in the garage and it automatically walks up to its battery charger station and it grabs another battery itself and puts it in and it goes out down the side of the house. I'm just picturing my house and it goes up on the side of my. The slope on the side of my house and starts using its camera to identify what's the difference between the plants that Darlene has planted, the ivy that's there, and the weeds that are there. Because it's AI vision, knows the difference and it starts plucking weeds. And again, I'm still enjoying lunch with Darlene. And when it's done with that and it sees that we're leaving, it comes in the house and it cleans baseboards.

Yeah, Right.

And I tell you what, we're not far from that. Whether that time frame, whether our friend Max is right and it's 2030 or, you know, which is less than four and a half years, or I'm closer to right at 24 to 36 months or 18 months.

I think there'll be some early adopters and early adopter options that you'll see right. From, from early adopter type individuals or even companies. Right. In the next couple years. I think mainstream, where you're seeing something on the mainstream side, I think is probably more like 2030.

Yeah. And 2030 or later.

So you're saying for mainstream adoption, where you're starting to see them and that they're, you know, mainstream, as we know. Right. It's just like anything else of technology, things have to really work. There has to be supporting materials, it has to be easy to maintain. It has to have all of those things. And the first ones won't be right, early adopter will.

And it ties to, you know, the comment when I first had this discussion with Darlene about this, about the cleaning the house, she was like, well, they'd never do as good a job as I could do or the housekeepers do. And he said, that's the difference between you and the housekeepers.

Right.

It's going to learn every time it does it, it's going to learn more and do it better each time. Right. Because it's going to have sensors that's going to know is there still dust there or is there, is there something sticky still or whatever it is. So I just think it's an interesting time. But the point being is less about, you know, we hear about people talking all the time about jobs being replaced and this, that and the other, the, the big focus. And you, you know here. Jensen Wong at from Nvidia that's making the chips that's going to make these a lot of these things feasible. Talking about quality of life. Right. And it's going to the idea should be is just even going back to your travel search. Right. And Brian Hoppy had made a comment about it, you know, eight minutes to do a a great full search and then go book the tickets when we get to the place. Right. Because right now we want to monitor and check and is it did it do the right thing? And so we're going to get to that place where it will be ubiquitous in our life just like the Internet is. Right. In that early 2000s, we were concerned about what information we got from the Internet. Right now we have our trusted sources that we get data from. This will become ubiquitous in our lives. And so what happens is when it I can literally just tell my watch I have to your your situation. Something came up yesterday. You need to be in Baltimore on the 12th. Right. It knows what to go do. But you're confident in it enough that you go enjoy lunch with Lauren.

Sure. Sure.

Right. Because those things are being done and that robot is doing what it's supposed to do and you're confident about it. So one, you might go write more software, you might start working on your next book or you just might spend more time at the beach. But it's quality of life. Sure. So good. Hey let's just scroll through a couple things hit just pause there in the sales and mergers and acquisitions. Our friend our friends David Gordon and John Gunderson and their team over at Electrical Trends posted a nice article that we have here in the newsletter about January through June electrical distribution acquisitions. Big acquisition also discussed here about of tariffs could be a related factor but their number was when I look at this it was a fraction of a percentage point of margin impact at Granger. I'm just trying to look at this real quick company that sales GROSS Profits rose 3.6% year over year and Union Pacific acquiring another railroad and Norfolk Southern Railroad I should say. And what the impact of that is on supply chain and so a handful of good articles there. And so if you again if you don't get the newsletter, let us know. We'd love to get that out to you. So there's lots more in the newsletter that we talked about today because the the Bureau of Labor Statistics hijacked our show today.

Yes, it did.

Right.

Yeah. There's a lot of good articles in here. It's too.

You know what that that Tom, do me a favor though. You know we'll just use it again. Three sticky situations that may soon crop up at work related to AI. We'll use that again next week because that would be worth talking about because there's some. Some surprising things it says. While I brings both promise and fear to the workplace, a new dimension is emerging. People are starting to gauge with the technology in unexpected ways. So that's the gig. We'll. We'll talk about that one again next week. All right. Gross profit margin however came in at 38.5 boy most distributors would look at this and like to be intrigued by Granger's 38.5% gross margin was an 80 basis point drop. So 8/10 of a percentage point was their drop of of margin in this segment. So Stanley, Black and Decker announcing some pretty significant impact. Alrighty my friend, let's wind this down, huh?

Yeah I was just trying to figure out how far we got. We got like yeah we got maybe two thirds of the way.

That's probably I think what we'll call it is we had the. We had the Powell factor today.

That's right.

Right.

That's right.

So great comments. A lot of good people with us. We appreciate everybody that's here you know small fraction of the P. The people that are listening in are able in a position to make comments really really appreciate Taylor St. Germain with the ITR economics just a great group there. What Tom, do you remember what is. I think he. He said for the their tracking at itr that they're 94.7. I think their. Their overall business Granger showing something as a on the distributor side you know less than 1% of an impact the tariffs of having at least at this point.

Yep.

So good want to roll into E Commerce and marketing. Let's do it and accurate over 20 years or something like that and they're sticking with it. And by the way if. All right how about unlocking growth through strategic personalization from sales and marketing if that's the case we need to be looking at some of their. If you don't follow itr I've been following now itr on LinkedIn and getting some great posts from them. There is a lot of changes coming in later in this decade that we should all be paying attention to so good stuff. Lots to do still today so we should probably wind down I think I'm on three more calls with you today. So we thank everybody for coming and joining us today. I thank you for the extra research and Tom, you did the calculations for us on what GDP really Means that was exciting.

You might want to go back and re listen to that part.

Yeah, that's right. But anyways, I'm Kevin Brown. I'm here with my lifelong friend and business partner, Tom Burton. We do this every week and we're appreciative that you've taken the time out of your day management takeaways on that for you.

Yeah, you know, so what the article is talking about, right, is how do you rise above the noise from a marketing perspective and you know, capture buyer attention. And so they're talking a lot about.

The importance of personalization and your valuable time to share that with us. If you find value in what we do, please share that with your connections, whether it's on LinkedIn, YouTube, hitting the follow button or the subscribe button.

And I was interested, I was thinking about this because we're seeing this actually with a few.

And if you're listening on the podcast, the Apple Podcast, Spotify, the best thing you could do to support us would be click that button that says subscribe and then leave a review. The reviews are really helpful to get this out in front of other people. If your company is in the wholesale distribution and manufacturing space, you're looking to gain better insight into your customers, your team and your overall business. Using AI to bring silo data into one place that you can really gain insights that you've never had before. We would love to introduce the Lead Smart channel cloud product to you in your company. We work with new companies every week and we're loving to see the results that people are getting. We have customers that are getting 20 plus percent growth in overall sales from the people using our platform. We're getting companies that are closing 5, 7, 10% more quotes than they had the prior year and adding millions of dollars in top line revenue.

Lead Smart customers right now who are using Lead Smart and the CRM data to drive their marketing actions. And I realized what they're really doing.

Is actually on six figure and the even low five and six figure investments.

Personalizing, trying to personalize their marketing more. So the misconception with personalization is it's all about personalizing to the contact. Right?

So count into the technology that are turning into seven and eight, eight figure return on investment. So love to talk to you about that Again. We thank everybody for coming with us. We wish everybody a great weekend. Be safe, be kind and do good things.

Thanks everyone. Have a good weekend. And I gotta, you know, hey Kevin and I know you like sailing and doing things like that. That's what you Think of. But in B2B, personalization is way beyond that because not only are you personalizing to the individuals you're talking to, but you're into personalizing to the account and the customer that you're talking to. Right. So the account can have information analytics and data about the account. About the account itself.

Yeah.

That can be used to actually personalize and make your messaging more relevant. Right. Because at the end of the day, why are you personalizing is you want to be more relevant and as you're more relevant, you get more attention. Right. That's really the whole purpose there. So, yeah, we're seeing more of this where. And I've seen this with some of our customers where they're using their CRM data and the data that we have in Lead Smart to build audiences, but not audiences so much based around the contact information, but around the account information. So therefore they're targeting their messages based on what the account is buying, maybe what they're not buying, maybe what they should be buying. Their, you know, their, their categories, all of those types of things. And then taking that and combining it with the individual that is receiving the actual communication. And this personalization is not just through email or things like that. This is. Could be done through any sort of sales action or sales motion of personalization. And anyway, that's what this article was talking about. But it was interesting, as I was reading it, to see we're seeing more and more of that at the account level rather than just the contact level.

Yep. Well, and, and it's interesting. It just makes me think we were, both of us went to a roundtable discussion that Bob Britton, one of our friends that's here on the show, made.

Some comments all about AI AI Roundtable discussion.

That's right. His favorite topic.

That's right.

But that was a nice group that got together. But there was, you know, it makes. Just kind of makes me think about how people are typically tracking website traffic that's at an account level. Right. And then that roundtable, there was some discussion about some great tools out there. I actually want to dig into a few of those to even understand how they work a little bit better. You might know, but the idea of being able to identify who was on your website. Now almost all the tracking tools out there can say, you know, based upon your pixels and so forth can say this company at this location called, you know, tied to IP address stuff, this company was looking at these pages on your website. But now when we can narrow that down to the person. Right. You were Just talking about account flipping, account data and personalization or an individual data as well. And I think this speaks to it here is, you know, some of these tools now can really let us pinpoint from who was on our website, what they were doing, which is important when we can see them on our E commerce site and then we know who it is and they're already in our system. Because typically we often think about, you know, from a website visit, tracking is. That's a new lead.

Right.

But now when we can get that data about who it is and because some, you know, sometimes you don't have people logging in because a lot of what distributors are doing is they're trying to track this. If they're trying to do attribution and tracking what people are doing on their website, it's from somebody that's logged into their account. But there's that whole component of the people that aren't logged in or aren't necessarily yet a customer. And when you bring all of that together using some of these tools, I think you get the maximum opportunity.

But I think, you know, Bob's saying here, right. People sign contracts, not companies, but companies or committees. We see this all the time, either make decisions or influence decisions. Right. So chefs in the kitchen. Yeah. And so there may only be one individual or whatever the signs the contract. But there's certainly been a lot of influence. I mean, we've worked through a couple of those this month. Right. Where just the amount of.

I don't know if you can see the gun to my head. Yeah.

Said you've been losing hair. So I figured out.

Right.

So. So the. So the personalization, I agree at the end of the day, there is somebody who signs a contract, but the personalization to be able to speak to a larger group and then be able to incorporate the relevance not only of what they care about, but the relevance of the company. Again, hopefully gets the ability to get that influence and move the group there. So.

Yep. Well, this kind of ties a little bit, Tom, into a couple articles down there. The was IT chief chief marketer.com invest in full buyer buyer life cycle, improve AI discoverability in 2026. And they were going back and talking about a forester, some forester guidance for 2026 for B2B marketers and about buyer life cycle and planning with that and identifying and understanding more of the buyer behavior and using the technology that's available to do that. So we talk about this at some level pretty regularly, but I think this forester research is very helpful as well. Yeah.

And it goes, right, it's to their point, right. You're not just getting a lead and then throwing it over to sales. You're trying to nurture not just the individual, but the committee or the group or the people through the buying process all the way through kind of the yellow brick road as I call it.

Forrester references it as owning the complete buyer journey.

That's right. That's right. And then orchestrating that. And then if you think of personalization, you would potentially want to personalize, quote, unquote, all throughout there to make yourself as relevant as, as possible through that journey.

Yeah, the. It's interesting we, as we're talking about this, you know, we were just together a few weeks ago in Florida at the affiliated distributors at their, their large buying group, had their E Commerce and marketing summit. And I was talking to a few different people and they were, you know, we were, they're talking about, you know, Lead Smart Channel Cloud, our, our product. And you know, we think about this as we historically think about, you know, we work have this one on one relationship that a salesperson has and with a company. And distributors are typically trying to, you know, gain a broader insight to what's going on. And now we've see all that with the growth of E commerce and so forth. But you know, I was describing to some people and I need to do some writing about this, but there's really three, you know, at least three buyer journeys, right? You have the buyer journey, if you think about it, the buyer as an account, you have what you do with them in person or on site or over the phone.

Right.

You have their E commerce journey. Right. Which is very, very important these days. You have a marketing journey that they're taking. And what we do with Lead Smart Channel Cloud, which is why we call it Smart CRM, is we bring all of those journeys together to be seen on a single platform. And then using the AI tools we have, like Genius Feed and other tools that we have that can take a look at that across the board about what is our customer doing and then really helping us target how we want. And you were talking about some of our customers earlier who were using all that data to kind of say hyper target folks and really understand that journey. But if we only want to look at a customer through traditional, as an example CRM or ERP data, we're getting one view of a multifaceted journey. And what we really need to be thinking about is what is there. And we, we have a whole area within Lead Smart Channel Cloud called engagement. Right. We want to look at what is that? Either the contact or the company, or what are they ingesting of us from us? Are they. What are they doing with our email campaigns? Are they coming to our events? Are they engaging in website content, video content, whatever it is. And then what are they doing in our e commerce platform? So when we start thinking about the insight that we get to our customer journey, if we're looking at it from three components of, you know, our traditional engagement with them, we'll just call them in person, inside sales, outside sales, customer support, those functions, our marketing function and our E commerce function. We see three journeys and now we get this deep insight that this Forester research is talking about some of the other things that we've talked about.

Yeah. And I think the middle one is more than e commerce. It's digital. Right. It could be. It's more their digital journey related to, you know, E commerce.

Yeah. Which can kind of almost tie that marketing component that I talked about.

And there's definitely three overlapping. It's a Venn diagram with three.

And that's the point. Right. Is when you understand all three of those now you have the capability of one, serving them better ads and harnessing where the opportunities are, and then two, to go with that is you're understanding them so much better.