Around the Horn in Wholesale Distribution - Episode #170

Sa. Sam. Good morning. I feel. I feel so lonely.

I know it. Yeah, it's just us.

Yeah, it's just us.

It's just us. There was, like, a party last week was pretty. Pretty cool. So I thank you again to our good friends Mike Marks with the Indian River Consulting Group and Dirk Beveridge and Ian Heller with Distribution Strategy Group, and our good friend Paul Kennedy from dsg. And our discussion last week, I thought it was not just fun, but pretty insightful. Gonna do a recap and put a bunch of notes together. I started to do it yesterday. Didn't get it done, but gonna get the. Everything in place now of what was prognosticated about the coming year. So. But it was fun and insightful, so great audience, great downloads that we've seen from that. And I just. I guess for me, I'm just really thankful for, you know, the caliber of those people and the things that they have going on in their business and their lives and taking the time to join us.

Yeah, it's like. So I feel a lot less lonely here. Bob is here, so.

Oh, perfect.

Yeah. Thank you, Bob. Yeah, thank you for jumping in and keeping us company. And if anybody else is out there, please jump in and keep us company because we're just feeling lonely today after last week.

Yeah, very good.

But I think taking that, you could even take the recording or the YouTube video or whatever and drop it into, like, a Notebook LM and have it really summarized, because I think there was a lot of conversation back and forth. But if you strip all the kind of. What were some of the key points? There was a lot of. A lot of key points like that, you know.

You want me to share them with you? I might have done that already.

Okay.

I actually use Gemini, and it's interesting.

LM uses Gemini. So.

Yeah, the interesting thing about that right now is, man, you know, we're gonna talk more about AI stuff today. But the interesting thing with that is that your tools are moving fast. But what's really unique is, you know, I remember a year ago, people were talking about Google being behind, right? And there was all that discussion about Google being behind, and OpenAI is doing all these things. And now if you look at the studio and so forth that they've put together, and when I say studio, of all of the different products that are available now from OpenAI that are tying together, that are NotebookLM and the VO tools besides Gemini and all of those things, it's just pretty astounding what they've pulled together of a suite of tools which I think is really kind of neat to see. So should we do a quick little hello and get the get things rolling before we dive into those predictions and say who we are and why we're here?

Let's do it quick. I think people know who we are and why we're here, so I don't think so.

We've got quite a few new people that are here for the first time today. From what I saw on LinkedIn, quite a big handful. In fact, I got a note back this morning from somebody in Eastern Europe and a couple of other spots that are our first timers. We had some new some new folks to the new folks to the newsletter as well. Got quite a few newsletter requests this week as well, which is great. So anyways, long and short of it, I'm Kevin Brown. I'm here with my lifelong friend and business partner, Tom Burton. We're at the 173rd week of us getting together on Friday mornings. It's probably more like 180, I'm guessing we probably missed five to seven of them over the time. But we get together each week, discuss a newsletter that we publish. And that newsletter is called around the Horn in Wholesale Distribution and Manufacturing. And what we do in that newsletter is we publish quite a few of the important articles that have are important topics that have happened in the prior week around the economy, supply chain mergers and acquisition, sales and marketing, excuse me, AI, robotics technology, HR and leadership, and all kinds of different topics. But what we do is we break those down by segment and we talk about how those relate to wholesale distribution and manufacturing. As we go into that. We love having guests. We've got quite a few guests coming up this year and we had a great group last week. If you do not get that newsletter and you would like to get that newsletter, we would love to share that with you. Very simple, one of three ways. Send us an email at helloadsmartech.com helloadsmarttech.com and reference the newsletter and we'll get that out to you. You can, if you're active on LinkedIn, you can certainly go search for that around the Horn and Wholesale Distribution and manufacturing newsletter on LinkedIn or go to the Lead Smart Technologies page on LinkedIn and you can access it there and and get that newsletter that way. Or we have a website for the show and the website is www.aroundthehornpod.com and you can subscribe to it there. So we'd love to share that with you, get you going with us and keep you up to speed on what's happening each week? We couldn't do the show if we didn't have the sponsorship for the company that Tom and I work with. We've got a person behind the scenes preparing for the show and we've got a, our editor who was with us last week, and producer John Taylor. And they cost money. So Lead Smart Technologies, a company that Tom and I work for, sponsor our show. Lead Smart has developed the product called the Channel Cloud. And the Channel Cloud is an AI enabled customer intelligence and smart CRM platform solely developed for wholesale distribution and manufacturing. And what we do is we bring siloed data from around an organization, ERP data marketing automation data, E commerce data and other data sources that are typically siloed and not helping you make broad decisions across your organization. We bring those together. We gain deep insights into what's happening at your customer, with your team, with your overall business to help you make better business decisions and accelerate growth. So if your company's digitally transforming and would like to take a look at what we do, we would love nothing more than to get together with you and share that you can reach out to us in the same way@helloadsmartech.com or, or just reach out and connect with me or with Tom on LinkedIn. I'm Kevin Brown and that's Tom Burton. So, Tom, you want to fly into the news?

Let's do it.

All right. So before we do that though, we started talking a few minutes ago about the great show we had last week and the folks that joined us. Let me share with you a little bit about some of the predictions that we had coming out of that so we can be thinking about this and maybe even talking about this in the future. So one of the key topics was that AI would shift from artificial intelligence, would shift from experimentation to strategy. So it'll move beyond simple pilot programs to become core strategic pillar for successful manufacturers and distributors. And one comment was made that early adopters are expected to achieve measurable gains that will increase a performance gap against those who are drifting and not necessarily adopting fully in that setting. I thought Ian Heller made a great comment that I caught in one of the snippets that we had on, on the website this week. And hey, welcome Dan Judge and Jeff Braun joining us along with Bob commenting this morning. Love having those two fine gentlemen with us. And but anyways, going back to that, Ian made a great comment that it's when one of the snippets, again, that's on LinkedIn and Facebook and YouTube from the, from the show. And he commented, Tom, that AI was going to. Was would need to move from a IT project to part of an executive management role and part of a leadership team. And I thought that was really insightful because if you're not using IT as part of a leadership team, you're really missing the boat in that setting.

So was his point that a leadership team should be driving the initiative?

No, no, no. It was part of the day. It literally I was part of the leadership team.

Right.

How we're making decisions, what we're doing, what we're doing.

Oh yeah, yeah, sure. It's not just an IT function or.

Move away from worrying about what IT is doing and moving it into. This is part of our executive planning and executive leadership team. Right. Mike made a comment about the rise of agency systems and orchestration. He predicted a surge in AI orchestration and agency systems that will reshape operations by automating workflows and order processes. Ian talked further a little bit about proximity as a competitive advantage, about where is the product and how fast can we get it to people. So that's moving away from the AI and technology discussion, but more about location of products and servicing customers at the level of they're expected to be taken or serviced at. Dirk talked about anti fragile leadership. Do you remember that?

I do. I remember the term. Yeah.

You weren't paying attention, huh? I'm going to tell Dirk. So what was it he said? That we're challenged to get past the word of resilience and move into anti fragile antifragility where companies don't just survive disruptions but they grow and the people grow and the people grow to help the companies grow. So we need to be less worried about less being. Not worry so much worrying about being resilient but be worrying about anti fragile in our mindset and how we work. And then Paul talked about human centered.

Before we leave Dirk. Before we leave Dirk. I. I thought his insights on. And I don't, you know, I. It's actually a concern I guess when he was talking about the survey he did or with some of the people and that people are, especially in the companies that he's dealing with are not particularly. The employees are not particularly happy. And I think he listed out 10 points that people were the employee base is concerned about and so forth. And look, with or without AI, right, you've got to have employees and people that are, you know, excited to come to work and happy to be working in your organization. And it sounds like there's a bit of a gap from what he went over there on some of that. Yeah. Anyway, I just thought it was an interesting point.

No, I thought. But I thought that was good. And then the other thing that Dirk talked about as well, and I think it was a McKinsey study. I'd wanted to pull that up today, but didn't get to it. But he talked about the fact that, you know, we, and we've got some articles. We'll talk about a little bit more of this today. But one of the comments too led to. Look, there's a whole discussion about RE with AI replacing people and then the retraining that needed to happen and that there's all kinds of reasons, all kinds. But there's research. I think it was from McKinsey that talked about. It was something like only 40% of those people were being reskilled successfully. I don't know if you ever do remember that comment. No, yeah, I know it was a. He had, he had some very specific data he was passionate about. In fact, I think there's a, a snippet on that as well on LinkedIn that was posted about from the show and I think you had made a comment and then he, Dirk fed into that and, and he was sharing that of the companies that have been researched so far that are looking at, you know, replacing people, those people want. Needing to be reskilled, so to speak, and that it's been an, kind of an abomination so far of that actually working well. So anyway, some good points. Let's see if there was. Then Paul talked about a human centered culture as a moat and that became a broad discussion across. Everybody emphasized that while AI accelerates performance of people, centric culture and trust based leadership, a good example of that was what they're working on as a employee owned company at DSG that Paul runs will be one of the ultimate competitive advantages as a moat around their business is a human centered culture. So I thought that tied in well because we did a ton of discussion about AI. Right. And there's all the risks to the workforce for that. And we had some great discussion about leadership and, and working with teams and growing your organization. So I thought that was good.

Well, if you want to listen to the replay, it's at the very bottom of the newsletter. The link is there so you can listen to the whole thing.

Yeah. Yep. And again, if you don't get that newsletter, let us know and we will get that out to you quickly and happily. So Tom, you want to dive into the news here?

Sure.

Very good. Where do you Want to start with.

Boy, we have a few economy things here.

Yeah.

I don't know, let's, well, let's hit that first.

The first one there. That from a Reuters article. It says the Fed survey suggests slight upgrade to the US Economy. You want to hit any of the points on that?

Trying to remember, I mean, basically. Right. That there was a modest upgrade and different things, but employment basically stayed the same. Inflation dynamics and the inflation side of.

Things was flat was the term that was used about hiring. Right.

So I mean it's, it's, you know, nothing, nothing has changed radically, I guess in, in their survey that was there. We're going to talk, I think later we're going to talk about the, the Producer Price index, which is an article.

Yep.

Coming up here that was a bit higher than expected. And as a result from that, the poly market of a Fed or of a rate cut in January is being basically nil. 95% saying there will be no rate cut in January. If you look ahead, 80% say no in March and 73% no in April, which if you add all that up, it means most people don't believe that there will be a rate cut before May, which is when we get our new Fed chair somewhere in that neighborhood. So. Yeah.

Well, what do you think?

I tend to agree. I don't think there will be a rate cut before May.

No, no. What about June?

Could be, I mean, that's, I, you know, there's a whole new, whole new world. Right. Coming with a new Fed chair and, and all that stuff. And I don't know who is going to stay on as the Fed governor, so it's hard to say after that, but I think between now and then, definitely not. What do you think? You're always more on the, on the bullish side of the equation.

So I want to stake to, you know, in 2024.

Yeah.

For that. I think we will absolutely have one in June. I think we may have one before was just trying to look as. When are the meetings? January 27th and 28th, March 17th and 18th, April 28th and 29th and June 16th and 17th. It would, I absolutely think there will be one in June, but I think we're going to know long before that, probably by the April meeting who the chair is going to be. And if we know who that chair is going to be, we know that that's going to be one that is going to be much more stronger, leaning towards the current administration's goals of lowering rates and stimulating the economy. So April would not surprise Me in fact, if there was a May meeting, I would suggest that there's a high likelihood of that. But I can pretty much guarantee there will be one in June and it would not surprise me if it's a half a percent versus just a quarter percent.

Interesting. Okay. I got dropped for some reason. I got completely dropped off here for a second. So I, I didn't hear what you said for the last 30 seconds. But if I think what I. You said is you're not sure between now and May, but you'll definitely be one in June.

Yeah. And I think June could be a half a point. But I do think that there is a reasonable likelihood of 1 in. Will's got a question about who won the bet. What was our bet? We are bet. I lost the bet early on talk.

For tacos last year. Yes. Yeah. So 24 until September and there wasn't.

That's well and that that ties into. And I heard some something yesterday on CNBC about June being just the factor of what they did last year is like let's just watch it, watch it, watch it. And. And then it was September before we got a cut. So in answer to Will Quinn's question, I own Tom a taco and when he pays his steak from 2024, I will buy him tacos the next day for lunch.

Happily.

So thanks for that, Will.

Yeah.

Appreciate that reminder. So. But I think what we're trying to put these, string these thoughts together. Right. Is you started our discussion today, Tom, about idea of just, you know, employment is kind of tepid and not much change. There's eight of 12 Fed regional banks reported some increased economic activity, but it was somewhat flat in general. We'll talk more about that in a bit. We've got more craziness in the world between things going on in this country that look like war in some segments of the country and then the instabilities in Iran and the things going on in Venezuela. We've got the interest issues here. We've got tariffs, we've got all these things going on. It really just leads to the looking at this year ahead is I think that, you know that back to Dirk's point about, about people in general, I think we need to be thinking about for leadership is being antifragile.

Right.

We need to be as. As focused on being able to make adjustments because there is nothing stable out there right now. There's the, you know, tariff issues, you know, are continuing. There's the geopolitical issues that are continuing. And I think there's going to be a significant challenge, to just be able to adjust and make plays on the fly.

Sure. And at the same time, though, I mean, yes, all of those things exist. Right. But at the same time, there is a lot of people, including people within the administration that are going out on a limb and saying that GDP this year could exceed 5 or even 6% growth. Right.

It's going to take a rate cut to get to six. Sure, that's the thinking. Right.

Yeah. But you look at, you know, again, all the other things that, whether it's tax cuts or tax favorable tax situations or you know, spending on data centers which is continuing to grow and, and things like that, there is a lot of, there is a lot of chatter, if you will, about some pretty significant growth coming this year.

Yep.

Despite all those things that you just said there. Yep. Now, I think we're kind of in this wait and see moment, but I think, you know, when we get to May or June, I think it'll be very interesting to see are we on track to that high level 5 plus, even in the 5 range of which is which really unheard of, actually. I mean, that's a ridiculous, you know, level of growth.

Yeah. So let's, let's quickly plug, plug the podcast that we are kind of referencing here that we talk a lot about on this show. We make some references to. It's probably, I don't want to speak for you, but my assumption is other than our podcast, your favorite podcast or most regularly listen to is the same as mine, which is the all in podcast. Is that fair to say, Tom, or do you have others you like more?

I think that's reasonable.

Yeah. So it's one, it's one I look for each week right away and then I catch up on some other ones when I'm driving. But the all in podcast is, is they, they joke about being the number one podcast in the world. I, I do think they're certainly top 100, maybe even top 50 at this point. But it's four Silicon Valley execs that have had huge success. I think one of them is worth 3 or 4 billion. Another one's worth over a billion, a couple billion. Another one's worth about a billion. And whether it was about a half a billion dollars, but they're pretty insightful and they talk a lot about geopolitical issues, not just technology, but they have some connections into this administration because one of the original podcast hosts there is David Sachs, who is the so called AI and crypto czar for this current administration. And so They've had some good access in but there was they did a show earlier this week where they had Howard Lutnick, the secretary or commerce Secretary on and really, Tom, I don't know about what your feeling is, but in listening to that one, for me, I think Howard Ludnick was who was a very successful, I think, bond trader and Wall street person and last thing he needs is a government salary to go along with his life. But he's there working closely with the administration as the commerce Secretary. And for me, listening to that discussion with Chamath Palihapita, that one of the hosts there who's one of the original early go to market people at Facebook and made a lot of his money there. But just an insightful conversation that to me it seemed like if you could take off all of your or strip away all of your political leanings. Right. Whether it's to the right or to the left, just take all of that away for a second and listen to some of the thinking behind tariffs and the value of what could potentially come from some interest rate cuts that are not necessarily tied to the beige book and traditional Fed thinking. It is really intriguing to see some of the things that could potentially happen. But I think to really get the crux of, and I'm interested in your thinking on this, Tom, because we both listen to it, is the real value would come is if you could strip off any of your personal leanings and just listen to the what if and what's going on and why tariffs are where they're at and what's going on with them. What are your thoughts?

Well, it was way more than tariffs. I mean, I thought the conversation was he was laying out the strategy. Right. The story behind the story of the strategy, of what is attempting to be done and the potential result of that strategy coming together, which is not something that we hear a lot about in any sort of mainstream news or in any side of. Right. Regardless. Yeah, you hear a lot of and, and so I thought it was interesting to understand the strategy. Again, you can disagree or agree with the strategy, but there is a strategy and he did kind of lay out what the the process is and what they're trying to accomplish with the strategy to achieve that growth and to get to, you know, things to another level. Because think about it, if you can increase the GDP consistently to that level, you can outrun the debt problem that we have.

Yes.

Right. The whole goal here is to potentially outrun the debt problem that we have and the, and the level of debt that we have through growth. And so I don't know if that's their entire strategy, but that is the strategy that he discussed, which is here are the things that we're doing to again, related to tariffs, related to tax cuts, related to interest rates, cuts to interest, related to having foreign entities investing and building in the country. All of those things lean towards that, you know, higher growth level.

Well, I think that's true. And I think the interesting thing that goes with this, Tom, is that we have and this ties so much to this discussion we've been having for the last few years on this show, but particularly since this administration has been in place for the last year is the idea that says we're bringing real world business tactics to politics and business people to politics versus politicians. And when you think about who our treasury secretary is, who our commerce secretary is and then who the president is and even the vice president being, you know, most recently before being a senator was a venture capitalist. Right. You're bringing business theory and business concepts and successful tools that they've used. I thought it was really intriguing to the idea of the what I think they called it the stair step approach that the president took to negotiating tariffs. That was basically first person at the table gets the best deal. And they use the example of India is that they had some discussions with India of what India wanted to accomplish with tariffs and they found some common ground. But the administration said you need to respond to this today. And India said well we'll kind of get back to you. And next thing you knew there was discussions with Vietnam going on and Vietnam got a better deal than India. Well, hat right. And so it was the stair stepped approach that said first person at the table that signs an agreement gets the best deal and every deal after that in generalities is not going to be as good. Which is very different than saying and I've said this 100 times on this show, right. Is traditional politics would suggest we're going to go meet in Qatar and then we're going to meet in London and then we're going to meet in butts one and then we're going to be blah, blah, blah, blah, all of those things. And we'll do lots of meetings around gold leaf tables and fancy meals and toasts at dinner and so forth and pomp and circumstance to maybe get something done down the road. And this administration's viewpoint is much similar to the business mindset that says play or leave, right? Get in, get out, we're moving on. This is what it's going to look like and And I just, I go back to as well. We've talked about this as well many times on the show is don't, don't look at this administration for any one thing. Look at all of the things that were promised and said that they wanted to accomplish that tied to the borders to fentanyl and drugs, to balance trade. Forget about the word tariffs. Think about balanced trade and then balance trade. Ties to interest rate cuts. Interest rate cuts and balance trade. Tie to onshoring, on shoring, ties to more jobs and more infrastructure and getting out of the trillion. Or what is how many trillion dollars is the deficit now?

More than that. Yeah.

No, I mean, that's tens of trillions. Right. So. Yeah, and so that's the idea. And your point is, right, Grow. Is your comment was, grow our way out of that. And with balanced trade, you can do a lot of that.

Yep.

So.

So again, the, the strategy, whether it will work will be determined. I know that, you know, sometimes maybe the means of how it's being done and the bedside manner of how it's communicated, I think that's a big part. A lot of people, and understandably so. But I think it was interesting to listen to the method to the madness. Right.

Yeah. That was great. Anyways, great episode of the all in podcast with Howard Ludnick. I laugh about. As you just talked about bedside manner. They kind of tiptoed around that a little bit. I joke about that all the time when we'll have the news on at home. And my wife, the president's bedside manner is not something that she's a fan of. And I'll listen to him saying something super articulate related to the economy, and I'll go, shut up, shut up. Just stop talking.

Right.

Don't add anything to it. And then sure enough, something else comes out and I'm like, oh, it was going good.

Yep.

So good. Good reminder for me.

Right. All right, let's move ahead here. So House passes partial funding to avert shutdown, but that's not the. Everything that needs to be done. So, you know, we had that shutdown. Right. That got obviously handled back in, what, November or October. Right. And. But it just was a kicking the can down the road to January 30, which is just right around the corner. And so a couple of things have been passed through to keep going, but a lot of things have not. And there's not a lot of chat. I'm not seeing a lot of chatter. You watch the news more than I do. Are you seeing a lot of chatter? About this in the.

Well, no, and that's actually a really good point. When I ran across that article yesterday, it surprised me because I hadn't been paying attention to when the next round of things was. I thought what's intriguing about that. Right. So the article is from CBS News about the House passing some partial funding. There were certain government areas that were going to be funded right away and others that needed more discussion. I thought what was intriguing about that in looking all of that is the fact, and I didn't know this again came from the interview with Howard Ludnick from Secretary of Commerce that says while our GDP numbers have looked really, really good, we're going to see in the next announcement a dip on that. I think it was up to one and a half points because.

Because of the shutdown.

Well, why because of the shutdown?

Because you're not paying the government employees to produce.

Government employees are, are used as part of our GDP number, which says we should probably rethink what is really part of the GDP number.

Right.

I mean, if you're going to try and this is Will made a great comment. Right. He says here with the current Fed system, we'll never get out of debt or right. Wrong or different about that is the world is operating different and certainly this administration in the US Is operating very differently than what we have historically used for our metrics.

Right.

And I have heard it in the last I, you know, my soapbox is, is 2% the right inflation number? I have literally heard because to your point, I watch the news a lot more than you do and I tend to listen to CNBC a few times a day or maybe some Bloomberg in the office and certainly at lunchtime sometimes. But I have no less than three times in the last 10 days heard people ask the question in interviews, is 3% the new 2%?

Right? Maybe. Maybe it is. Right. Maybe it is. Maybe it is in reality. Right. Whether or not that should be the target or the thing that we're shooting for, that's a different conversation. But it may end up being the new normal.

Well, I think what that leads to the point is that if we want to look at these things and just the discussion that you just brought up about this partial funding thing, if we're going to see our economic results that are impacted, that impact the stock market and impact so much else of what we do day in and day out is using some bad reference points like why is, why is, why is the payroll clerk at the Department of Agriculture salary tied to the gross domestic product of this country, the largest country in the world, largest economy in the world. Well, it's just, it's, it's just bad data. Right. So I, it's just, I'm just throwing out the idea that I think we're in a place in the world right now or in this, you know, in the US economy or maybe rethink what are, what are, what is in the beige book that our first articles talked about today, that the government stats that come out that the Fed works upon and that all of these things are based on and there's a whole lot of, whole lot of people that are a whole lot smarter than either of us that are kind of starting to question the same thing that is saying maybe using the payroll clerk. Do we need a payroll clerk at the Agriculture Department anymore anyways? And why is their salary tied to something like GDP that is so impactful on so many other factors globally, not.

Just in the US So I have a question for you.

Oh is it's easier when I just speak my mind and I don't have.

To think, okay, well you just set your. Yes, I know that's a big ass softball for. I'm not going to take advantage of that one. But if anybody listening, please jump in and jump on that one. But the question that I have is, I don't know, four, five, six years ago. Right. Did we really talk in our life? Right. Just in our day to day life we rarely talked about politics that was there but was kind of not really front and center to things. Very few people even knew what GDP meant or stood for and trade deficits and tariffs and all of these things. We just didn't talk about them. It wasn't something that came up in our, our day to day life. I don't now to me is a lot of the even politics and the political and not so not the part of the, you know, right or wrongness of it, but just the conversation of it.

Yep.

And all the things are starting to become mainstream in our, in our. And I think it's a positive thing. I think it's a positive thing for as a society to know more about, you know, understand these things better and work and have at least more awareness of what's going on. Right. And I don't know do you see that? I see that more in the mainstream more and you know, dinner conversations, things along those lines. And I certainly ever did, you know, five years ago even.

Yeah, I think about that a lot, Tom, in all honesty. So for the last three years I've been so Far, much, so much more deep into these things than I've ever been before. Not the political side of it, but the economic side of it and what it means to the economy in the US and globally. Because, you know, the, the reality of it is, was it, was it. But Thomas Friedman was it that wrote the world is flat 25 years ago or whatever it was because we have such a global economy. I've paid so much more attention to it because of how it impacts our customers at Lead Smart, how it impacts Lead Smart as a company and then obviously since doing this show for three years. But I do think there's been, in response to your question, I do think, let me be careful how I say this, I think that the first term of the current president triggered a lot more discussion about the economy and tying the economy and politics together outside of just the historic, you know, I mean, to your point, right. I didn't care what the Fed was doing five years ago, seven years ago. I never paid attention to that in my life.

Right.

But it's so impactful on one our customers and our lives as well. But just the economy that I do think that there might, I guess I would say there could be a component of that that is tied to the thinking, the business thinking that's been in the White House for two of the last three administrations.

I mean, even look at. And we need, I know we need to move on here from economy, but.

But I like Will's comment here. He said he likes my line of thinking.

No, it's. Well, he is, I mean, you're right. Right. The government, the GDP is, the philosophy is the GDP is driven from government employees because the idea, the idea is that government employees are producing something.

Yeah, absolutely. Right.

Which has a whole nother thing. So anyway. But yes, it is, it does incentivize potentially to increase the, the size of the government. But what I was going to say is even like, you know, all this fraud stuff, like the Minnesota stuff and all of those things, much more in your face mainstream. Right. Than what we would have had. I believe a few. And there's a lot of reasons for that. Yes, right. There's a lot of reasons for that. But I don't know, you know, in just conversations I have with friends and family and things like that, these types of conversations are way more prevalent, I am finding, than they would have been a few years ago. Correct. And I think it's good.

What do you think? What do you think it, what do you think's caused it?

I, I think just a whole Lot of things. You know, I think obviously, you know, social media and YouTube and all those things have with it. But I think it's just to your point earlier, I think these, a lot of things are. Have more direct impact on people's lives and what they're doing. And I just think it's more visible. It's been more visible, right. In the whole tariff thing and the tariff thing initially crashing the stock market and then bringing it back. It's just a lot of things, right. That have come together and I think it's good. I think it's good to. I don't like the division part of things, the right or wrong or, or all that kind of stuff. You know, the division that's created the division of it.

Okay, yeah, right.

But I do think of understanding and having more awareness of these things is very healthy. I mean, all that corruption and fraud that we're starting to see pop up is just because people had their heads in the sand. Right? Yeah, right.

Well, I mean, I think. Yeah, Bob makes an interesting comment here. It says until economics and finance become part of the core curriculum taught in K12, you know, I think the mass. I'm not sure the masses will understand the impact. Right. And I think that. I don't know. I mean, I, I didn't. We had a little bit of economic stuff we learned in, in early school, but it was. I was in junior college before I learned about guns and butter. Right. What are we producing, you know, and in, in economics. But I do think there is, you know, I mean, I keep referencing back to the same podcast that all in podcast earlier in the week talking about, you know, what are we producing out of our universities, right. How, how many, you know, gender studies degrees are, are beneficial to help the economy grow.

Right.

And if the people that have the gender stat. No, no offense to that, you know, line of study. Or maybe there is, but there are so many worthless degrees that are coming out of schools that people have, you know, high five figure, if not six figure debt to go with them and there's no jobs to be had for what their degree is, you know. And right now, you know, one of the biggest. There's one of our articles today talks about one of the biggest factors out there right now to the AI driven economy in future is power. One of the biggest challenges with getting power is plumbers and electricians, right. So we'd be far better served as an, as an economy and as a country and probably the world by having more skilled plumbers. And I'm going through this with, with one of our kids, he's looking at a career in law enforcement, which is admirable. But I'm telling him he's got a wife and a baby and they want another child. And I'm saying, look, you know, you live in Colorado. We've got some great customers in the H VAC and electrical space in Colorado. Let's get you connected in with, through them with, into some contractors there and you know, go, go make 200, $250,000 a year living in Colorado Springs as, as an electrical contractor, you know, you make more money than law enforcement and help the future.

Yep.

You know, so. All right, so I, before we kick out of the economy section, China's trade surplus surges 20 to a record 1.2 trillion from this was from industrial distribution, but it was, you know, pulled from a bunch of other sources like AP and so forth. But it's interesting that, you know, China, as we're going through the tariff component of things. Right. That things are not changing dramatically of what's coming here, but they're also moving a lot of their capabilities to other countries. And what triggered for me on this one, Tom, was there was another article that I bypassed to putting in the newsletter, but it was about how much more Canada is cozying up to China right now because of the issues with the US And Canada.

I think they just reached some new trade agreement between Canada and China, maybe even today. But I, my question is it's, it's saying here, right. That China has rerouted their exports to other countries, plus their imports have reduced for their own economic reason. But how do they create demand in these other countries? What are they doing to create demand in these other countries? That would be an interesting thing to understand.

Yep.

But yeah, it's interesting that certainly have pivoted and shifted a bit on where some of this stuff is going.

Well, and there's a component of that too, with. Right. Trying to drive chip production here in the US and so that is, has been a big part of things as well. And then there's a challenge with automotive stuff. So, you know, Tom, this is always hard sometimes because we have a little bit of a delay with how comments come in, but as people are typing them sometimes we moved on. But back to, the, back to the last topic we were talking about about just kind of with education and different degrees. And Will Quinn made a great comment. He said it's interesting concept that the administration is floating to have the university partially liable for bad student loan debt when people can't get Decent paying jobs when they obtain frivolous degrees. And that's a whole nother can of worms. And we could talk for 20 minutes on that. But I think that is an absolutely interesting concept to say. Why would you, why would you. It's like, it's like saying, I'm going to, I'm going to finance somebody that has, you know, a minimum wage job to buy a Ferrari. Right. I'm going to give you all of this money for something you're never going to be able to pay for. And then wonder why we got into this situation. Right. In the business world that doesn't happen.

Right.

But we're doing that in the, in the education world. So. Good, good comment there, Will.

Well, the, the loan. Right. The student loan system has driven up the cost of education because there's a lot of quote unquote free money.

Sure.

Out there driving. It's inflation. Right. There's free money and inflation coming in there. So it's an interesting thing is that if you told a university kind of what is the roi, what is your return on investment on the people that you're bringing out there? And then the ability for students to get loan debt for those colleges were adjusted based on the return on investment that's coming out the other end, then you would start to see some balance right along the way. But right now it's just the universities are not motivated to, they're motivated to just keep the people in college and get them through with the student loan.

Well, absolutely. And, and it's almost, it's become a business machine.

Right.

Let's get the government to loan the money or guarantee the loans. We'll raise our prices because we're going to get paid regardless. And then we'll, we'll make these degrees that are popular with. It doesn't matter whether it's what you're thinking about as a finance degree or you're thinking about a Earth studies degree.

Right.

Whatever it is, as long as the university gets paid, they're on the forefront and off they go.

As Bob said, free money equals monopoly money, so.

Oh yeah. Yep, yep. So anyways, any other comments about the China trade surplus?

No. No.

Okay. It is an important piece of that though. You know, it's. And they're still, you know, China is still importing or exporting, you know, crazy amounts to the US it's just not the same. It's not the same. The drop is significant, but it's still the magnitude of what they're shipping here is still huge.

So, you know, I Wonder if, if it is sort of some of the stuff going to other countries, is that just a middleman for then having stuff come back into the US at a lower tariff rate or.

Great.

You know, it'd be interesting to, to pull the string on that because I don't. It's just hard for me to understand is, well, how are they going to just automatically create that level of demand?

Right.

How good in these other countries?

Yeah.

Entirely on their own.

How does Myanmar all of a sudden have so much demand for that item?

Right, right, yeah.

I'm gonna ask Gemini that real quick.

Producer Gemini.

Yeah. See, because I had the article in there and so I asked us, are some of these products ultimately coming back to the US through these countries? It's doing. Its analysis says yes. Many of these products are indeed flowing back into the US through the process often called trans shipment or rerouting. While China's direct export to the US dropped significantly in 2025, falling by roughly 20%, its overall exports grew largely because goods were redirected through third party countries to bypass high tariffs. Trans shipments via Southeast Asia countries like Vietnam, Thailand and Cambodia have seen massive twin surge, they call it. Their imports from China and their exports to the US are rising almost in lockstep.

There you go.

Said Mexico.

Disappointed? It didn't tell me. I had a great question.

I didn't, I didn't reference Tom. I should have said, Tom's asking then it would have said that, you know, it's a brilliant.

That's a brilliant question.

Yeah, that's funny. That's funny. It said Mexico is the back door. Mexico has become primary entry point. Chinese firms are increasing increasingly using foreign direct investment to build factories. Blah, blah. We've talked about that over and over again. So anyways, good, good question, Tom.

I mean when you just look at it right at face value, it doesn't add up.

Yeah, agreed. So what are they doing with. What are those countries that didn't need it before doing with all that now?

Right, yeah, exactly.

And I'm sure, I'm sure there is economic growth in those countries and they have a use for quite a bit of it.

But not 20%.

Correct.

And whatever that time frame, as we're.

In our manufacturing distribution segment, we've talked about a lot of this stuff already. Any articles there hit your fancy before we move into E commerce?

I think we've actually hit most of these, so why don't we go into.

E Commerce, reference some of those articles. If you'll scroll back up for just a second, Tom There's a good article there from Distribution Strategy group about manufacturers 2026 reset raises the stakes for wholesale distributors. Great article by Ian and Jonathan's team there. And then there's another article there, growing through tariff uncertainty. And a good article from Industrial Distribution about supply trade, supply chain trends to look for. We've talked about supply chain and so forth. I would have liked to have talked about that article, but We've spent now 50 minutes on the economy and supply chain. So let's move into our next segment if we can. E commerce and marketing. Anything hit your fancy there?

Well, that first article, marketing to machines, A new funnel for an AI driven buyer. Basically what their premise is, right? If you, if you look at traditionally how people did research for buying, right, you went to Google and then what do you do? You see all these different links and you bounce around and then you may of course end up on a company website or potential website of a company that you are considering doing business with. And you kind of had this breadcrumb trail, right, of things that occurred in your research process. What they're saying here is with AI I can go to Gemini and have a conversation with Gemini and never leave Gemini or chat GPT or whatever and even potentially get to the point where I ask it to make the purchase, right? That's not even taking into account agentic shopping, which, which is a different, different story. So the research process of how people are researching products or buying decisions changes considerably to be kind of sole source in a sense that it's doing everything in the AI aspect of things rather than bouncing all over the place and looking for things, poking around, so to speak, for what that is. So that reduces the, doesn't reduce, it eliminates those breadcrumbs. A big part of marketing in the past has always been attribution, like where did the people come from? What. And it's much harder to know that now. And so it also was talking a lot about is, okay, how do you then make sure that you're properly represented or you are represented in the conversation that a person is having with the AI that's there. And what I found interesting on that is yes, there's optimization that you can do on your website and so forth, but it also said very important to be represented on other websites, whether it's press releases or review sites or other things like that, whatever it may be, right? So because the AI is obviously taking data from, from multiple sources.

Well, I thought, I love the comment it made here is that about marketing to algorithms, right? Was just was just a great phrase. And you know, we, we're here because of wholesale distributors and manufacturers is the only reason we exist as a company. And then this show. But the idea behind that I think is so unique because you know, marketing in our customers is just so varied. I mean we have people that I think are highly experienced and do a great job of all of these types of things. A mix between digital and print and now using AI and using even we have customers using our software to analyze what's going on at customers and who should get the right promotion based upon the Data that's in LeadSmart, channel, cloud and so forth. And we have other customers and other people that we know that the person that's running marketing is a person that used to be in sales and before they were in sales they were in customer service at that company and before they were in customer service they worked in the warehouse and now they're a marketing expert. The future that we're talking about here is a future where you could have a contractor on a job site that is asking Gemini or Perplexity or chatgpt about who has the best availability and the best price of a product that I need. And if you're not ready to market to that or be the person that pops up because you have an SEO strategy for your website from seven years ago. The world's changing fast and that marketing to algorithms section of this article I thought was great.

Yeah, no, it's a good article. But if you just look at the behavior, right. If the buying, the research and the buying behavior is changing considerably, how do you adapt to that buying behavior? Right. And I think there's some real opportunities to take advantage of it. And you're in the early stages of this as well.

Yep. So it's good. Let's jump to jump ahead there, we have an article there about. It's from martech.org Marketing Technology 7 tips for building a B2B social presence that actually works. And you know what, it's. It's funny, we have a new marketing leader joining our marketing team on the second of next month and I think we do a reasonable job in marketing at Lead Smart. But and you know, there's so many facets to take into. But they talk here about awareness, interest, consideration, conversion and so forth and then what platforms are we using? And I see the day in and day out, I see this spray and pray is like oh, we have TikTok. Oh we have LinkedIn. Oh, we're doing a little bit of this. And does X play or Twitter play a factor in all of this. And I thought this article is pretty good about really understanding where your platforms were. What's the personality, what's, what's the context of what you're working? I thought there were some good points to that. The point I saved it because I want to review it with our new marketing lead that's starting in a couple weeks. You know, are we, are we on track with this? Because I saw some areas that we could improve significantly as a company.

Yeah, well I think the first two article or the you know, the other one we just talked about. Right. Is something that we, we need to look into.

That's good. So there's the next article here is from cnbc. Could an Amazon business warehouse near you be next? Because that article is talking about Amazon. It's from CNBC opening their first big box retail store in a Chicago suburb. So this is on the retail side where they're opening a 229,000 square foot store. I don't know what the biggest Walmart is.

That's a. I was trying to understand is this a competitor to Costco, Is this a competitor to a Walmart or a Sam's Club or is this a competitor to a Home Depot or all of the above?

Well, I don't think the Home Depot component of it because I think that's where the title, this article, the way we titled it was could Amazon business be next? And I think that would be the component of that. But absolutely. A a Walmart, a Costco. I'm just ask trying to see what the biggest Costco is in size out there compared to this. So the largest Costco is in Salt Lake City, Utah. 235,000. So just a touch bigger than this square feet. And I'm going to ask about Walmart here. So this is nearly the biggest the size of the biggest Costco and the average Walmart super center is 179,000 square feet and the largest anywhere in the US is 260. So this is much larger than the average Walmart Supercenter. Not Walmart but Walmart Supercenter and probably about the same size as the average Costco out there. So my the reason for posting this article though Tom, was and the question that we posed with it in the around the Horn and Wholesale distribution manufacturing newsletter was tying to the idea of how much longer before they put that that B2B or their Amazon business location in near where your job site is where you can buy a fall protection harness or a hard hat or wrenches. Or whatever you want from the assortment that they have. So this is just more of the creep.

They also said that these centers are micro fulfillment centers. Right. So these aren't just retail, they're. So it allows you to deliver very quickly. Right. If you order and there's one in your area, you could have it delivered, you know, in hours.

Well, imagine, imagine just doing that. If they said, hey, you know what, in these particular areas we're going to put a storefront on our distribution centers and we're going to do it in certain areas where the focus of what's moving out of that distribution center is tied to B2B. We'll put a storefront in there and we'll load it up that much more with what are the B2B activities in this area?

Right.

I mean, who better could have the logistics that could say we have five housing complexes and a data center being built within 10 miles perimeter of this center. Here's what we're going to load. And this one is going to be more B2B than B2C. Right? Heard it here first.

Yeah, yeah. No, I mean, I think that's very, very real. I mean they're, they're using all of their logistical prowess to take things to another level.

It's good. Let's, let's jump ahead, Tom, to our next section. What do you say? Anything? And we're in our technology and cybersecurity and AI segment. Got an article here from Distribution Strategy about Google's agency AI push disrupts wholesale distribution. Any thoughts on any of these articles that we have here from you, Tom.

I read the first one, but I have to admit I was like, I have to understand this a little bit more. Basically saying that Google is offering a. I wouldn't call it a suite, but a system maybe is a better word that allows somebody to kind of go through stages of the buying process, from planning to purchasing to fulfillment, all of those types of things. I have not seen that and I don't know. What I don't know is how that would then actually play in a B2B world. So interesting concept. More homework to be done there. As I read that article, I was like, man, there's just so much to understand here.

You talk about the Home Depot Google cloud component, the first one here. Okay, gotcha. Yep, yep, gotcha. Well, that remains to be seen.

It's so hard now to keep up with stuff. I mean, it's like I, I could literally spend 40 or 50 hours a week just keeping up with stuff.

Yeah.

So it's just unbelievable how much change is coming and how much technological change is being driven by some AI applications. Good.

Tom, let's jump down to these articles about the one about cybersecurity. The executives worry most about cyber enabled fraud, geopolitics and AI. It's interesting right now with the big shift that we've seen in the last, I don't know, maybe you'd have a better timeframe to this, but to me it says the last six to nine months. You know, we've been historically worried about, as we think about cybersecurity, we've been worried about hacks. Right. Did our, did our system get hacked? But now what we're seeing so much more of in this article touches a little bit on that as well. The cyber enabled fraud is, is truly even AI tools being used to have people let us into the org, let somebody into the organization as opposed to trying to hack the organization. What are your thoughts about the timeframe I'm describing as we're seeing more and more of that?

Oh, we're definitely seeing more, more coming in through the front door.

Seems like the last six to nine months for me.

Yeah, no, no, no. I mean coming in through the front door rather than the back door.

Right, right. Is click this link and let me in.

Right. I got one yesterday that they tried to emulate like when you get a payment from QuickBooks and I would say they did an 80% job on it. Right. So the point where I actually did a second take on it, but it's, you know, again you can look at some of the email addresses and other things and immediately know it's suspicious. But yes, there's a lot more fraud actions trying to come in through the front door rather than the back door. And you know, then once they get in. Right. It's much harder to get get them out.

So yeah, makes me nervous as we're hiring more and more people at Lead Smart that don't click, don't click, please don't click. And it's really interesting watching more and more of the companies that we work with that we're seeing emails that I'll send someone an email and the response that I get back I can see in the line from when they hit respond was this banner that says this is from outside of our organization. And actually our outlook shows that for me now as well. But seeing more and more of that, those flashing reminders of who are you interacting with here?

Yeah, and there's a lot of companies that are doing a lot of training on this the whole, you know, cybersecurity training is a very big industry.

Yep.

Good.

Where do you want to go next?

You want to go into sales?

Why not?

Hey, we all love sales.

Yeah, that's it. This was an article that didn't make it in last week, but I saved it. And it talks about a new look at account management. Where does it create value and where it doesn't. It says account managers have long been seen as essential, but in many cases they're unintentionally creating friction instead of removing it. And so this whole article here talks a little bit about that. And it says, it says, meet your Amazon.com account manager. Have you ever wondered why you never received an email from Jeff Bezos introducing your new account manager? Right. You haven't. Because you need an Amazon account manager like a fish needs a bicycle.

And what was its logic there?

Well, it goes on. Where am I at here? While some folks like the idea of an account manager, the cold hard reality is an account manager or would only be a value neutral to the extent that they are not involved with your Amazon transactions. So the point was getting in the way, right. If you had a person, right. What, what if there was? And I'll just throw it out to you. Right. When.

So when they use account manager, would that be similar to an outside salesperson or.

No, my name's, My name's Rhonda and I'm your, I'm your salesperson.

Right.

I'm going to help you through your transaction. When you want to buy batteries tomorrow, document that arrive at your house tomorrow. Tom. Okay, that was the idea behind it. So they gave an example here. It said over the years they his. This was, this gentleman is Justin Roth Marsh and has written a few books related to sales and distribution and said over the years we've worked with a number of organizations that build specialized machines for manufacturing. These machines tend to be expensive and consequently they're extremely important purchases. And it goes on to talk about the idea that when you have these strategic purchases and things where you need maybe a sales engineer and so forth, that goes with that. It's critical. But the whole concept behind this is how, what, what components of your transactions are people involved with and do they need to be involved with them? Right. If you need to buy bathroom cleaner, that's going to arrive at 4am when you awake and tomorrow morning, you don't need the friction that a person would add. You need to click the buttons accordingly. And I think we're seeing more and more of this in the B2B world where we're seeing the commodity purchases of. I buy dust masks or nitrile gloves or whatever it might be on an ongoing and consistent basis. I get those coming quickly. And I don't need anybody involved in that. I don't want anybody involved in. I don't want to talk about. I don't have to click a button even to get those coming. They should just come on demand.

So, so, so what does that mean for the role of the outside salesperson or even the inside salesperson?

Bring value.

Okay.

Assist. Assist people helping to understand. It really, it really ties to the, the component. We were on a call yesterday with a. A great partner and customer of ours in Canada and we were talking about a tool that your team built within Lead Smart channel cloud called Revenue Expander that exposes white space. Right. Most salespeople and I I've spent my entire career up until six, seven years ago when we started Lead Smart in and out of B2B transactions, at nuclear plants, at pig slaughterhouses, at glass factories, working with distributors, both as a manufacturer's rep and as a manufacturer. And I can tell you, and I'll just give you the simplest example, when I was a manufacturer's rep and we represented a company that made safety glasses and I would go with a distributor sales guy and we would go into just any type of manufacturing plant, first thing you do when you sign is, is you get a pair of safety glasses. They there and 99 times out of 100, I sold safety glasses. He sold safety glasses. And they the safety glasses that we had as visitors were coming from someone else.

Okay. Right.

And we could walk by through a warehouse and I could say, hey, you know what? I represent a company that makes floor matting and you sell my floor mats. Those aren't our mats. Oh, I wonder the guy, you know, this response is I need to look into who's. Who has that business. So my point is we would walk by more business than we were there to talk about or that they had. And that's what Revenue Expander does by analyzing ERP transactions.

Right.

And customer invoices and so forth and bringing that to the light. And so when you're a person that now brings new solutions and as we talk about with our customers all the time is that what mostly happens in that setting is. I shouldn't say mostly, but quite often is when someone introduces a product, the customer's response is. Or the end user's response is, I didn't even know you carried that.

Yeah, right.

So we can illuminate that now someone's bringing value to the equation. When someone just says, hey, I'm your, I'm your sales guy. But you could just easily click through and order this on our website. Where's the value?

So it's interesting about the revenue expander concept which we should be thinking through is let's say some of that white space wouldn't require a sales interaction, but it could require at least open the door for them to have an online purchase of it. So some, you know, some of the white space may require a sales involvement, an actual person and in person involvement, but some may not. Then that opens the door to the marketing side or the online demand creation side to potentially grab some of that white space through a E commerce transaction.

Sure, that's a great, great point. Yep.

All right, I made a note on that. Just more work for me.

No, you have people for that.

Yeah.

Get them started. Don't you have an agent? Don't you have an agent for that?

I do. I have agents everywhere.

Says you should. Let's roll into people in leadership as we roll through the show today. So if AI, this is from HR Dive. If AI wipes out entry level jobs, what comes next?

I wanted to hit Bob's comment real quick though before we left here. He's bringing up, and this is true in technology, I think what he's saying is relationships managed by account executives or account managers come after the sales engineer prove the technical feasibility of the product. The sales engineer being the subject matter expert, and I believe this is definitely true in the software industry, is that more and more sales are being driven through that sales engineer or forward deployed engineer, whatever the flavor of the name is the day, who is the expert that does that and then the salesperson kind of comes in behind that and help structure the deal or deal with whatever. How does that work, do you think in the distribution world? Like who are the, who are the equivalent of the sales engineer in the distribution world? Or do we need to make the outside salespeople and the people that are dealing with it more ready to become that sort of expert in the process?

I think you inadvertently previously answered your own question.

Okay, I think I did too.

That's how smart you are.

I know, I know.

It is actually the core, the core of the problem of there being white space is because salesmen sell what they know most and are most comfortable with. So I'm going to go sell at my customer that stuff that I'm a subject matter expert on.

Right.

So it actually is almost a self what Would you say almost self fulfilling challenge?

Right, right.

Because the challenge is self fulfilling because I have this challenge of white space of what's not being sold.

Right.

And it's caused because I'm a subject matter expert on valves, whatever, you know, whatever it might be, this brand of H vac, you know, components, but I don't know enough about the switches that go with it. So I don't talk much about that because I'm a subject matter expert on this. Right. And then that gets expanded even far further. Now what you see in a lot of arenas is. And a lot of our customers have this. This is where they have very specific specialists that go in to talk about a particular topic. Because the salesperson is a generous. The manufacturing company that I had invested in years ago that I ran the day to day, I'll say BD and product development side of things and the sales side of the sales side of the team was we did a lot of work with Grainger and the founder and principal owner of the company that I was working with after working with Grainger for a bit, and he's a, you know, at his core, pack my bag on Monday morning and get out there and sell type of guy, right. He made a comment and no offense to any of our. I have a lot of dear friends at Granger and former Granger executives, no offense to anybody there. But he made the comments, gentleman made the comment. And he said Granger salespeople are a misnomer. They should not be called salespeople. They're logisticians. They make sure that boxes are being moved of what somebody requested as opposed to selling something that they could be using to better their operation because they get too wrapped up in the wrong item got shipped. And I need to make sure this happens and so forth. So what you see in that setting is the selling oftentimes happens when you bring either someone from the factory in or a manufacturer's rep representing the factory is when that technical sale starts happening most often.

Yeah, but I do think that we, I mean, I know we're doing this right. We're working to enable the salesperson themselves to be able to handle more of this on their own and not be intimidated by the white space. Especially. You see, you know, we see this more and more in our customers. Is business development teams being formed that are kind of, you know, specialized teams that are supposed to go out and really look for that new business and pursue that new business. You know, you have to have some understanding of what you're talking about in that area of the white space other than knowing it's there. Yeah.

Well, I think the key thing. Right. Is when you know that the white space is there because you've got paid attention to it, because you're busy doing other things and haven't even thought through that because you're so wrapped up in other stuff. If, if the alert is there, which comes to your smartphone in the case of Lead Smart Channel Cloud. Right. Is just the alert there that says, hey, there's an opportunity to sell this new item at this location. It doesn't mean that that salesperson has to be an expert at that. It means that that salesperson has to be alerted and understand that there is this opportunity that's available to me at this location. And maybe I need to call the Viega rep, the Schneider rep, the, you know, MSA rep, whoever it is, to come make those calls with me to go help capture that business. But it's the awareness and the understanding of it that goes to the salesperson, to the sales leadership, and even at some level the executives. In the case of what we do.

At Channel Club, you have to know it's there. Then you have to have some data or more analytics to have more insights into what's there. And then you have to know what you want, how to go about it to actually capture the white space.

Yep.

Right. So those three things.

Yep. It all starts with awareness, right?

Yep.

Good. Why don't we roll on through this and get ready to start winding things down. Anything else you wanted to catch there? Excuse me.

You know, we kind of hit on this. If AI wipes out entry level jobs, what comes next?

Yep.

I think that ties back to some of the reskilling conversations.

Right.

That we were having earlier. Obviously, I don't think we've seen evidence yet of AI wiping out early entry level jobs. I don't think a lot of entry level. I think there's slowing, slow hiring in those jobs right now. But we haven't really seen tons of job loss yet in those areas. But it very well. And I know Ian's very. On the show last week was that was one of his things is that that is an area of.

Well, he said it's very understated what's really going to happen. And I think that. I don't want to say he's right or wrong. I think it could be very much understated. I think the interesting thing now is in this article, you know, talks about this again from HR Dive and it says the end of 2025 painted a dollar picture of the job market for entry level roles, saying that they're disappearing. Companies plan to replace these positions with artificial intelligence, but then it moves on. It says what the narrative hides and it says some high profile layoffs and job cuts at the end of 2025, including 14,000 roles eliminated at Amazon, were pinned on AI adoption. But may be a convenient narrative for employers. It says this was a quote from Jason Walker, co founder and CEO of Thrive Consulting. Says layoffs are pretty much always on the table, but I think what makes them easier to do is the guise of we need to get more efficient. And Al allows for that narrative. And we've talked about this countless times. I think, Tom, that, you know, people are using this as an excuse to, I'll say right size their organization where they've maybe brought some AI in and they're using it for different things. I think, you know, back to the comment that you made about Ian Heller's comment last week about things being understated, I would suggest, and I'm going to throw this out there because I always do stuff like this, even though I don't have a true basis. For us, it's a hypothesis at the moment, I would suggest that we will probably see a similar or equal amount, maybe even greater amount of layoffs that come or people needing to be reskilled, which is the hope that we see, right? We hope what we see is reskilling because of robotics or humanoid robotics, more than just AI. Because, you know, when you look at, I mean, think about this way, right? If you were to look at, let's just take a wholesale distributor, right? The number of people in the warehouse unpacking trucks, loading shelves with products, picking orders, getting them back onto a pallet to go out to a customer typically would, I don't want to say dwarf, but multiples larger of people than we have at entry level clerical positions that can be replaced by AI. Well, we're going to be in a place in the next 18 months to 24 months probably where we will be seeing humanoid robots for less than $15,000 who don't take breaks, they work 24 7, they know how to change their own batteries and they're probably cheaper to replace than repair. That can be taking over vast amounts of warehouse jobs and so forth. So I think we could be seeing that humanoid robot be a factor just as much as AI, at least in the B2B or wholesale distribution.

That's considered physical AI, right? That's just.

Yeah, exactly right.

Not another manifestation of it.

But I think when we start looking and this article is talking a lot about that when we start looking at that component of it being the, you know, the entry level jobs, it's, it gets be physical AI is the right way to look at that. So but the good news is right before we you know end up on that, on that particular topic is everybody said the Internet was gonna, you know, the computers were gonna change things or, or the assembly line was gonna be the end of you know, the workforce. And every time we've had one of these major shifts in the workplace they have added jobs. And I don't see that changing here. It's just you know what we needed fewer people assembling cars when there was an assembly line. So what did they do? They did something else. Yep.

So but you have to be reskilled, right?

And. Yeah, well reskilled and you know, fewer you know, the geopolitical impact on the you know, Upper Kern river salmon migration degrees.

Yep. Right.

That, that's what I think comes out of this is what are we teaching people?

Right.

Bob, says here the key to robotics is where the break even point is is financially.

Right.

Well I, I would say when you have a $16 an hour and rising consistently minimum wage. Right. That break and you can get a fifteen thousand dollar and those prices are just going to be driven down. There's going to be leasing programs, there's going to be staffing agencies popping up very, very quickly. They're solely about staffing you with AI or physical AI and humanoid robots like they were historically of bringing you in temp worker. The same thing will be coming out of this. And when you can do that for. I'm going to guess you're going to see some of those in five years you're going to have sub ten thousand dollar humanoid robots.

Yeah, right. You're gonna pay, you can pay monthly for a hundred dollars a month or whatever the case may be.

Exactly right. I mean my good friend Scott Leaf that joins us quite regularly on the program. He's has a marketing agency and does some consulting work. But he comes from. He's a former senior sales leader with Air Gas, the big distribution company is how I know Scott from years and years ago. We were on the phone two months ago. He has a client that he works with that has I think they have five or six large vehicle car washes. Like you pull your semi in and you can rinse it off and do the wash thing there. Not like you know you would take your, your, your Acura to. But they, and it's not like he has a hundred of these things, but what's is it? I guess test. It's Tesla itself that's doing the. The robots. It's not a new company. The. What is that robot called?

Optima.

Optima. Optimus. And. But they've approached him about bringing humanoid robots in on a trial program where he pays a small fee and then if it works out right, he buys those robots. So we're gonna see more and more of that. And the Chinese, I think, are ahead of us truly on humanoid robots. But that's. I heard somebody comment last week that's good friends on one same podcast we were referencing earlier. It's good friends with Elon Musk and he was saying his belief is that, you know, in 10 years, Tesla will be more, more well known for the robots than the cars, of course.

Yeah, that, that goes without saying, I believe.

Is it really? That surprised me. It's interesting. You think that.

Yeah, I think. Yeah. Tesla will be, they'll be like, what car? They made a car, right? It is. They're banking the farm on the robotics and if you look at even his most recent car, Comp Planet predominantly is based around that. So.

Yeah. Well, it's interesting. Great, great comment from Scott Nicely here. He says Persona AI, which is a company I haven't heard of, I'm going to look at them up as soon as we're done today, is working on humanoid robots for the trades. Right. So now how. How many robots do we have running around the construction site?

Yeah, right.

And, and, and I, you know, I, I'll go back to that. You know, I talk about humanoid robots all the time that, you know, when they're finished packing all the boxes around dark, they go outside with their sensors on and they're, you know, shining a light and using their sensors to count how many two by fours are on a stack. Right. Or. And they've got their fire sensor and their carbon monoxide sensor. So I think it's exciting time. And I'm telling you, there's going to be. There's going to be a humanoid robot weeding my hillside after they wash my car while I'm sleeping. It's gonna be in this house.

Okay. All right. And you said before. When before?

I said 18 to 24 months. I think I said. Yeah, okay.

All right.

So I don't know that. I don't know that Darlene will allow one here that soon.

You know, they could just climb up every day and keep your trees trimmed.

Solving my HOA and neighbor problem with My trees. Yes. Thank you for that reminder. I hadn't thought about that in a couple of days. All right, let's scroll through past our channel.

We should just go ahead and wrap up. Yep.

Let's just head down to. Though there is one thing we do need to talk about in our industry scuttlebutt section that you're not stopping at. Brad Jacobs and the team at qxo added another $1.8 billion on top of the 1.2 or 1.3 billion that they had done a couple of weeks ago that were announced to get out there and start acquiring more businesses. So after their big acquisition of Beacon Roofing, I tell you what, with a three billion dollar war chest, there's a whole lot that they can do and they have got a very interesting approach to what they want to accomplish moving forward in this setting. So I think that's one to watch. So.

Yeah.

Yep. So I'm kind of, I'm gonna, I'm gonna be at the. As a side note, we talked a lot last week on our show about in fact, Tom, scroll down to our calendar, if you would, there on the newsletter. We have on the newsletter upcoming events, which is the trade association buying groups, industry events that are coming up. We try and keep ahead of that. We do part of it on our own and we hijack some data from our good friend Mike Hockett and his team at Modern Distribution Management puts a lot of that together. So we use some of that from my good buddy Mike. But we talked last week about the, with Ian on the show about Distribution Strategy Group's AI event that's coming up in June. But I will be headed a week from Sunday to Washington D.C. for the national association of Wholesalers and Distributors executive summit in D.C. and we'll see Mike there. And Mike and I actually had a discussion a few weeks ago, I guess about a month ago at a conference that we were both at with Hardy and we talked about maybe pulling our shows together and seeing if maybe we could get Brad Jacobs to join us if we did, you know, Tom and Kevin and Mike in combining the power of both the MDM podcast and our podcast. And Mike get him here because historically he's. He's probably waiting more to for the Wall Street Journal interview. But who knows, we might be able to get him or one of his team members on to talk a little bit about what they. They're working on.

That'd be great.

Yeah. So we'll see.

Are you gonna go interview some of the administration while you're There as well. Get some interviews with the, the White House.

Well, the president's asked me to come meet with him on my thoughts on, on, on how interest rates.

On interest rates.

Well, he's, he's, what he wants to do is do a meeting with me first because he's been listening to the podcast consistently and he's a big believer in my thinking that 2% is no longer our inflation number and that we're using the wrong metrics. And he wants my thoughts on that. And so I'm going to meet with a Bessemer and, and Ludnick and then he wants me to go meet with Powell after that. So it's going to be a busy week because, you know, Naw is interested in me in helping with them with their strategy as well. So I'm a busy few days in D.C. okay.

Starting to smell a lot in here. I'm ready to wrap it, wrap things up. All right.

Well, thank you for joining the number one podcast globally.

That's right.

How's that?

There we go.

All right. Well, my friend, another good week. Great comments. Appreciate Bob's comments, Scott's comments. Everybody that joined us today in the comments, I had a handful of text messages coming through as well. We do this every week and we certainly enjoy it. We couldn't do it without you coming. And we're certainly appreciative of not only the friends that we have of the show, but we have quite a few customers that join us as well. We could do this each week with we didn't have John doing his part of it and Lily doing her part of it on the front end of things and the sponsorship of the company that Tom and I work for. So if your company's looking to digitally transform and put a platform in place that can bring silo data from across your business, as opposed to just buying more point products that have more silos. And you want to bring that silo data together to use artificial intelligence and other tools to make better business decisions and accelerate the growth of your company. We would love the opportunity to talk with you further. Reach out to us anytime. If you don't get the newsletter, you can reach out at the same email address. The newsletter we put out every Friday around the horn and wholesale distribution and manufacturing, just reach out to us@helloadsmartech.com you can also go to LinkedIn and find that there. You can certainly follow Tom and I and see the updates there that we do as well as the Lead Smart Technologies page has some great data that comes out every week. So we'll look forward to next time and the guests that are coming in our lineup soon. Tom, anything exciting for the weekend?

No, not too much.

Okay. Just going to be coding and writing new software updates.

Yeah, just another day in the office.

Another day in the office. Good for you. Appreciate your diligence there. It was good to have you in town this week. Got to enjoy some dinner you missed. We had a board meeting this week for Lead Smart and drank some special wine that I had set aside for our board. And you were doing dry January. I could not convince you.

Didn't even. Didn't. Wasn't even tempted.

Wasn't even tempted. Good. All right, so you're down like £17.

Not quite today. Yeah, pound a day.

Okay, good. All right, well, thanks, everybody. Appreciate you being with us. Great comments today. Loved having you all with us. And we look forward to seeing you next week again. Hope you can join us. Last thing we'll say is, if you like what you hear and you enjoyed the show today, share it with your friends. If you're listening on the recorded podcast on YouTube live. Excuse me, on Apple podcast, Spotify podcast, wherever it might be, please click the subscribe button, follow us and share the idea with your friends. Well, thank you everybody for being with us and we'll wish you a great weekend. Be kind, be safe. You do good things.

Thanks.