Tariffs, Trade Wars, and the Rise of Made-in-America.

Foreign.

Welcome to around the Horn in Wholesale Distribution with Kevin Brown and Tom Burton. Sponsored each week by Lead Smart Technologies. Tom, Kevin and their guests review the news of the week and dive deep into the topics impacting manufacturers, wholesale distribution, independent sales agents, and the global wholesale supply chain. Whether It's M&A SaaS and cloud computing, B2B, E commerce or supply chain issues, we peel back the onion with our guests into the topics that impact your business the most.

Are you driving a car?

That's all that I'm able to do for my dancing today.

That's. That's a weak excuse.

Yeah, I know. It's pretty bad.

Yeah. You're here. I'm glad the show is going on even though you're a bit under the weather.

I am. I'm pathetic and a bad partner for you on this. Last week I was stuck on a plane. Today I have the flu. But we're here, right? We're here. We're gonna get through it.

We'll get through it.

My lovely wife has got a handful of cough drops and she's got some tea for me and I'm gonna get through today because another.

Another light. Yeah. As Bob says here. Good morning, Bob. Another week of just light news. Nothing really going on. So I'm sure we can get through this. A to B.

Hey, Tom, before we even dive in too far here, you, you're always ahead of me on, on getting stuff researched and done. Bob sent us both a couple of notes this week on stuff and. And I got to apologize. Bob Britain, thank you for that. I did not get through those, but I'm going to try and review through that stuff. I'm grateful for when we have people that join us regularly on the show that share ideas and articles and thoughts with us. And I just want to shout out and thank Bob for that and I will get through those because I know they're meaningful.

So, yeah, no, there's one in particular that I thought was a very, very good summary of the overall strategy. So, yes, I agree. Thank you, Bob, for those and if you want to keep them coming, it really helps.

That was that. Yeah. That was also my pitch for send us article, send us thoughts, send us ideas. If you have them. You can send Bob did it through LinkedIn, which is a great method. He just sent us a message to both Tom and I. That's great. But the other part of it is you can email us anytime@helloadsmart tech.com and we'll get those. There we go.

Well, you've got the mute Button like.

I got the mouse is over the mute button. Yeah, there will. We'll have a few of those today. So, hey, let's. There's just a few things going on in the world right now that we're here to talk about as we do each week. So, Tom, let me kind of hit the. Hit the highlights of our. Of our housekeeping, as we call it here. So I'm Kevin Brown. I'm here with my lifelong friend and business partner, Tom Burton. Excited to be here with you today as it's been a great week, even though I'm fighting something a little bit of a bug off. We've had a great business week as well. And we get together every Friday morning as we say, unless someone is on an airplane, in the hospital or on a planned vacation. And last week, as we were able to do it, as I stepped off an airplane, and we still did our show from John Wayne Airport here in Orange County, California. But we get together, we discuss the news of the week. But what we do with that news of the week is we discuss how it relates to wholesale distribution and manufacturing. That's the audience that Tom and I serve in. Our company lead Smart Technologies. And so that is what we try and pull together. So what we do is we publish a newsletter. If you don't get that newsletter and you'd like to, we'd love to send it to you right now, but I think it's about 10,500 or so people get it each week. And that newsletter goes out early Friday morning. And we cover things like mergers and acquisitions and sales and marketing and AI and technology and cybersecurity and the economy, supply chain, all the different things that go on. But what we focus on is what does that mean to wholesale distributors and manufacturers. And we bring great guests with us on a regular basis. We have a loyal audience that joins us Live on LinkedIn and sometimes YouTube or Facebook Live, which is where we're live at. But then later in the day, all of this information gets edited and organized and put together by our editor and producer, John. And up to the PodCloud it goes, so to speak. So if you're listening on the podcast, you will not be seeing the newsletter that everybody else will be seeing. That's live with us or watching the recording on YouTube Live, Facebook Live, or LinkedIn Live. But you can get that newsletter. Three simple ways to do it. You can send us an email@helloadsmartech.com and we'll get that right out to you. If you're active on LinkedIn just search around the horn and wholesale distribution newsletter and that'll pop up for you as well. There's also a page for the show there and you can follow and like that as well on any of the platforms. But on LinkedIn you could request it. And then we have a website for the podcast as well. It's called aroundthehornpod.com so www.aroundthehornpod.com you can see past episodes, subscribe to the newsletter, subscribe to the podcast on any of the formats from there as well. So again, we do this each week. We couldn't do it without the sponsorship of the company that Tom and I work for. Lead Smart Technologies is a quick little plug for us is what we do at Lead Smart is we help wholesale distributors and manufacturers gain deep insights into their customers, their team and their overall business. Doing that in a single platform where we bring siloed or what sometimes we call data that needs to be corralled. We bring it into one central location. Data from ERP systems, marketing automation, data lakes, data warehouses, e commerce systems. We bring that all into a central platform where we use AI powered tools to uncover opportunities for growth and even some potential risks. We do that in a way that's extremely cost effective and quick to implement and very, very quick return on investment. In fact, we were on the, I was on the phone earlier in the week with a customer that is literally planning right now to get around 2 to 300 times return on investment probably in this first six months of using the system. So some great opportunities there. If your business is looking to digitally transform, use artificial intelligence and other advanced technologies to help your business grow and serve your customers better, we would love to talk with you. So I get it all there, Tom.

Are you good? Are you worn out? Do you need to go take it?

Oh yeah, I gotta go to bed now.

Yeah, no. And hey, you know, good news. We, we signed another very large marquee distributor this morning to Lead Smart. And what's cool is I'm not seeing any slowdown and, or, or mindset of slowdown. In fact, I would say that the, the speed of which we're seeing companies at least look at how they're going to incorporate technology and the things we do at Lead Smart in the business has picked up in the last, even the last 45 days. So to me I think that's really good sign. I think people are looking at, hey, what are things I can do something about versus entirely getting caught up in all the things that maybe are, are less.

Yeah, I Think that's a great point. And you know, it's so. Yeah, Yahoo for us every time we sign a. Yeah, we sign a lot of customers along the way each week, but sometimes they're, they're large. This will, we'll have an announcement about this one shortly. But yeah, this is a large wholesale wholesale distributor. And but what's interesting, it makes me think about, as you say that really quick is before we dive into the news, is that, you know, we had a board meeting last month and the chairman of the board of our company was kind of, I was showing some forecasts and some numbers and you were a little cautious on some of them to start with and he, you know, brought some things up. Related. Yeah, but what, you know, what about all that's going on and the economy and the things like that? And I thought a couple of things went on with that was in that discussion because I, you know, I'm always the bullish one and you and the rest of the board are the ones that kind of wrangle me and, and slow me down a little bit. But, but I'm going to bust these numbers out this year, like I was telling you guys. But I think what it is, it is intriguing to see that there is no slowdown as we look at wholesale distributors and manufacturers that are looking to leverage technology. Our pipeline's growing significantly right now, which is great. The interesting thing though, and we have. You and I haven't even spoken about this yet, but there's an uptick more in the first quarter of this year with manufacturers that, that doesn't suggest for one second there's any slowdown with wholesale distributors that are, that are looking to expand and grow with technology. But the uptick versus the. I'll say. Versus the second half of last year, the first quarter of this year, there's a significant uptick with manufacturers in our pipeline.

Yeah, agreed. Agreed.

So it's an interesting, interesting thing. So good for the manufacturers out there. Ready to roll. So, hey, you know, nothing much to talk about today. Nothing going on in the, in the week. You, you want to kind of start us off in our economy and supply chain segment.

It's just such a dull, boring. Yeah, yeah.

Nothing happening.

Yeah. So I guess our, our first article this week is more around the stock market. Right. Which also had a very dull week and continuing to have a dull week. Yeah. So, I mean, I guess we don't need to recap everything. I think people know what happened during the week today from the, the zigzag and the big Jump on. Was it Wednesday? I believe it was.

Yep.

I haven't checked.

Whiplash. Not a zigzag.

Yeah, a whiplash along the way. I think we're up a little bit today, which is, which is good. You know, it's the thing. I was also on Monday, I don't know if you remember, there was a quote unquote fake news announcement that went out that said, you know, we're going to have a 90 day hiatus and the market literally jumped up. Like I think fake news.

Fake news, yeah.

But before the fake news, the market literally. About 2, 000 points, I'm pretty sure. And then once the fake news came out and went back down and looking at some of the statistics that, over $4 trillion of transactions took place in about 20 minutes.

Wow.

And that isn't from you or I or in our Schwab account or our E Trade account making trades. Those are the quant, you know, the automated trading.

Right.

All of those things that are going on. And I think we're seeing more than ever right now, as you just look at these massive moves, is the effect of computerized trading that exists on what, in fact it is basically what drives the market and what, what, what Wall street is. And having worked for a, a hedge fund in a previous life with it, which that did computerized trading. I have a little bit more insight into this than the average person. But it's, it's pretty scary because these, a lot of these traders are not set up to handle this large amounts of volatility that are there. You know, you hear a lot about AI and is AI going to ruin the world and is it going to go rogue and all of that stuff. But there's a lot of, a lot of potential impact with some of these computerized, massive computerized trading systems that are happening.

Oh, we'll comment on that about wondering how many of them are AI driven. And there's even, I think less of a. They're all moving with AI, but they've been doing some advanced algorithm work for, I mean, Tom, how long ago was it that you were, you know, you worked on that project in Utah? I think it was, it was.

That's going on 10 years, 15 years ago maybe.

Yeah, I was easily, easily 10.

Yeah.

Yeah.

So it's, it's not to get into this, but. Right. These computer algorithms are based on basically momentum. Right. So as the, as the computer senses that there's a change or the algorithm change, a sense in momentum, whether it's up or down. Right. They tend to react and then they build on that. Right. Well, when you get these massive.

Right.

What we clearly had is a straight up and vertical and then straight up back down or even on Wednesday when the announcement was. All of a sudden you're just seeing this high volatility momentum. It's not a gradual momentum which is more typical along the way. And as a result it can throw a lot of. Anyway, there's just a whole lot of things that can happen.

Right. I'm just looking sideways right now, Tom, just because I'm looking one at my Apple stock app on my computer. Everything that I own except for Salesforce and a mutual fund or an etf, I'm sorry, are up. And the NASDAQ is up almost 1%. Dow is up almost a half a percent and NYSE is just 0.2%. So S P 500 is a 0.63% today. So nothing staggering, but at least they're green.

I don't think the market 10 per temper tantrums are anywhere close to being.

No, no. Yeah.

Bob was saying the algorithms had a large part in driving the 1987 crash. Agreed. And obviously the algorithm's gotten a lot more sophisticated. They continue to get sophisticated, but I mean that's a lot of money changing hands and in a very, very short period of time.

Yeah. So. So you know where we sit. Let's talk a little bit about where we sit and then we can dive in a little bit more. Right. So we got basically a 90 day pause right now.

Right, 90 days except for China.

Right. And, and then I, you know, I heard a great, great point this morning. And so this is. You want to kind of reference the articles we have. So we have an article here that we referenced from, From Reuters about U.S. stocks $drop. These are from yesterday by the way. So we, we try and kind of, for those of you, if you are with us for the first time today.

We, we need like a real time newsletter that can just dynamically keep up with all the.

Well, you know what's interesting is that Lily, who manages both the podcast Force on the front end and John Ran is the back end and Lily and I were just talking about trying to not necessarily the newsletter, but maybe have a site on the lead smart website where we're putting up kind of some breaking news stuff as, as it goes throughout the week as well. We haven't figured out exactly how to do that, but it's at least in discussion. But this is an article from Reuters. These are from yesterday, but Tom and I always try And I both try and catch up on the news of the morning as well. But there's, let's kind of take a look at this because the next article is from USA Today and it says latest updated tariff charts. Why don't we look at those charts real quick, Tom, and kind of see where things are at right now. So this, if you're watching with us, it shows start of the day, what the tariffs looked like as of the 9th, today's the 11th, and then what they looked at like at the end of the day. So there was some adjustments down on some things as we, as we look across the board there. And I think one of the big impacts through all of this though, and we talked about it last week briefly was this. The issue is I think people were thinking about, okay, Canada, Mexico before, ah, why can't I never just, I cannot remember what they called last Wednesday. Not Independence Day, but it was Liberation Day. Liberation Day, right. I think going in. And as I mentioned last week I was at, in fact, thanks for Bart Schwartz is mentioning, mentioned Howdy from Nashville. I was with, in fact, I think it was on Liberation Day that Bart and I were sitting down talking at the Industrial Supply association event before the announcements were made. And Bart works with manufacturers on partner strategies and so forth and is a good friend of the show and of mine. And I have effect. I have a call with him next week on some AI strategies in his business. But the as we hit that, you know, that big announcement of last Wednesday, most people, including most of the people that I talk to consistently about these topics that are wholesale distributors and manufacturers, we're, you know, thinking, okay, we got Canada, we got Mexico. Big hit's going to be China. What's coming with China? I might be safe because I've moved a lot of my business to China, Vietnam or Laos or, you know, other parts of Southeast Asia. And then boom, out of the box comes what was that? I don't, can't remember the total number, but there's, you know, just about everybody, you know here. What's the, what is the fifth or sixth on the list that you have in front of you there? The Christmas Islands.

Right.

If you scroll down, just, you know, as we start off with that, Cocos Islands. And you know, and what's interesting about that too is I didn't understand that at first. Well, let me finish on the first point. The first point was people were not expecting, you know, they, I think we're expecting something with Europe, the Canada, Mexico thing in China, but boom, to have basically Every country in the world, right? The Ivory Coast, 21 Curacao, you know, 10%. And the people thought that was just ridiculous, right? Of the, well, wait, you know, this in, you know, get, you've got the opposite, the opposing party now, you know, mocking the president because there is an island that there's nothing on but penguins. That's mentioned. Right. Well, the idea behind that is, and it goes back to, you know, this, this particular person has been saying forever, right, Mexico, Mexico, Mexico, Mexico. Because China's already been cuddling up to Mexico to move things through Mexico. But now when we talk about these, you know, Christmas island as an example, or Cocos Islands as it's saying on this list that we have on the screen here. And again, for any of you that are listening on the podcast and not the, and can't see our screen, you can catch the podcast, the recording on YouTube, Facebook Live or LinkedIn Live if you just go to the Lead Smart Technologies page on any of those. But the idea behind that was there's already a tariff on those locations. So if any of the, we'll call them heavy offenders want to start moving items through those countries, there's a tariff there already.

Right.

And it's just so funny. And I think this is, I know you've got a lot of deep thoughts on this and I want to get to those, but I'll just pontificate for a second here. I think the most important thing that's going on with all of this is that everybody takes a step back and looks at what the, look at what the administration wants to accomplish versus sound bites. If you're living with sound bites, it becomes very difficult. Now, I don't say that to minimize what's going on that, you know, with distributors and manufacturers right now that are trying to figure out, you know, I mean, a box of latex gloves, a good example, you know, going to be what, 145 more expensive, right? If they're coming from China.

Yeah, potentially.

Yep. And so those are meaningful issues. Right. Especially if you're, you know, stuck. I mean, nobody wants to use force majeure in their contracts because the idea of using force majeure in something really, it's just there's such a negative connotation and it's such a, it's just risky. Right. There's no other way to put that. But people are going to be forced to do you think about just somebody as simple as somebody that supplies latex gloves to hospitals, you're that's going through a buying group Or a buying a purchasing organization, third party. There's a couple of hands in the pie, right? And now you go that you've more than doubled the, the, the cost of those to bring them in. And it's a really big struggle with all of this to look and say, well wait a minute, you know, I've got millions of dollars a month of latex gloves going to this buying cooperative for these, you know, hospital chain or whoever it might be is really a difficult thing to go in and say, okay, now I have this one little thing in my contract that says what I can do and it's, there's people that are going to try and stop you from implementing force majeure as well. So I think there's a lot of issues that kind of go with that that people weren't expecting when these hit across the board. So Bob says here, right goal as I understand this, but free market forces in the driver's seat for international trade. I think that's, I think that's right. I would throw out. The way to look at this is one is, and I think what I put this best, I think there's a myopic view one can have of all of this, which is the quick news bites. Then there is the broad spectrum view that says, I don't know whether it's three dimensional or four dimensional or nine dimensional, but this administration has proven, not just with the president but the people surrounding him that they have a very broad view and they're playing two or three moves ahead on all of this. And my view of this is that what they're looking to do is a series of things, right, that were pretty much very clear. One was borders, two is fentanyl, right? That was the first set of pressures right now tariffs, where we get a level playing field for that, you know, instead of being detrimental to the U.S. we have a balance of trade and that will then support the tax cuts that are promised in the US and the tax cuts will then support on shoring of manufacturing and building a stronger US based economy. And I'm sure there's two or three others that I am not aware of or haven't even been hinted at yet that are available or that are planned out there that we haven't seen yet. But those are the basics of it. And when you see that that's what they want to accomplish and these, these are like dominoes that have to fall in order, right? It's a better understanding of what's going on.

So, so let's take that, what you're saying and move into the next article which is the U.S. china's tariff battle. Who will blink first. Yeah. Right. This is from IMPO magazine and I was reading that article last yesterday and I really, it really kind of caused me to think about a few things that I think would be worth touching on. And so you know, what are we.

I just come back in like five minutes.

No, I'm, you know that's you. Right. That's what I mean.

That's.

I'm sorry, I'm a one minute guy. You're a five minute guy. Okay.

That's might be true. I'm afraid of the comments that might be coming right now.

Yeah, I know it was like realizing that was probably not the smartest thing to say. But nonetheless we'll move on. So the here I'm going to do another. You heard it here first. Right. Thing. I think in the next 90 days all these countries we just showed that big list or the majority of those countries will have some quote of arrangement or negotiation where we will probably likely collect some tariffs to your point because that's going to help offset some of the tax bills, a 10% or whatever. But we'll have, we'll have some sort of updated agreement on the whole thing. So I don't think that, you know, I know there's a lot of worries that in 90 days we're going to be right back to the same place related to all of these countries, even Europe, I believe is contingency flying over to the, to Washington this weekend to work some of these things out. So I think there's going to be, is it going to be perfect? No. Is there going to be hiccups? Yes, but I think for the most part it's going to. So then it comes down to the US and China.

Right.

In the next 90 days or whatever and this article is talking about who is going to blink first. What I found interesting about the article is, you know that China is probably in some ways obviously there's the imbalance. Right. We're, we're taking a lot more from them than they're, we're giving to them. But China's kind of knows how to weather the storm a little bit because they've lived it in the previous Trump administration. Right. They live, they, they work through. They've come up with strategies and policies to get around some of these tariff things. They weren't as large as they are now. But you know, can they weather the storm? Yeah, they at least they probably believe they can to a degree and so as it says here, who's going to blink first? I don't know who's going to blink first. I think you have two very stubborn and, and, you know, there's definitely ego and other things involved, right. And who is going to actually reach out and try and do this? But the question would be, what is the outcome we want to achieve with, with China, right? It's like people would say, well, we want to have, you know, they want to respect our, our trade rights. We want to be able to operate in China without, you know, without having to have oversight or being part of companies. The trade deficit shrinks. All of those things. We, you know, there's a lot of things that we would like to happen, but in reality, some of those things may improve. But really. And I think this comes back to what we were just talking about. If we could come out of all of this with China and move away from being some sort of, hey, we're going to cooperate economically to actually, we have respect for each other as strategic, competitive countries, right? That would really change the game because I think, and I think we've seen this with AI and deep Seek. There was. There's not really ever been a respect for the competitive nature or capabilities of China. And then deep sea comes around and we're like, oh, crap, we got to take notice, right? On the AI front, they're, they're a competitive. So I think a lot of this is a mindset shift between both countries that, hey, we're going to respect each other as competitors rather than trying to manipulate and figure out how we, you know, maybe cooperate, cooperate economically around some of those things that are here. And I think that's probably the best outcome that we can look for. And if that happens over the next 90 days, then a lot of these other things that we just talked about will come into play. Right? I think that was only about 2.

Minutes, so 7 minutes and 43 seconds.

That was no 7 minutes.

Excuse me. Okay, you're right. That was good. So a couple things with that. There's a few comments I want to get to. But first is there's two things I caught up on this week. One is with this impasse, right? There is the military risk goes way up because if we can't come to this agreement, what, what the, the, the. I'm trying to remember how it was put. I heard this two or three times this week on some things I was listening to specifically, I think on CNBC was. You know, historically there's been never. There's not been pressure amongst the US And China from a military standpoint, because there's so much economic, economic activity between the two countries that it'd be crazy to be in any type of, or even threatening real military things. Right. And so with, until this is kind of sorted out, there is that risk and it's all about the South China Sea. And they just, Right. And there's all kinds of things going on between, I shouldn't say South China Sea, but Taiwan and the South China Sea and so forth. And then there was an announcement earlier this week that there was this new, huge, new strategic undersea oil find in the South China Sea. I haven't read the article fully that I've got it saved to read over the weekend, but now that's going to be an issue that's going on there as well between those other nations there and you. We've made it clear the, the US has made it clear that there's a support for Taiwan in these things. So I think that's a, there's a geopolitical factor that is now there's a lot more tension until these things get solved. I think they have, they will get solved. And, and what we're going to see out of this, who blinks first thing is I think there is going to be a, a, I mean, this is the way, you know, it just came to my mind, Tom, I think this almost ties to like when you and this will be interesting to see if this plays out, that it's almost like when we're trying to deal with the budgets, right. And the, the Republicans and the Democrats are fighting about the budget and you know, it's the 11th hour and the US budget's going to go and Social Security checks aren't going to go out and what happens every single time, right. It's midnight, bewitching hour that they come to an agreement.

Right.

And I think there's a little bit of that going on. Now. Obviously this is a big, you know, a big playing field and a big factor that goes with this as well. But I think that that's probably how this plays out. And what we see is the, I'm just trying to get his name right, Xi Jinping. And in China, we'll be able to go back to all the Chinese and say we won, we crushed the Americans in this agreement. And, and President Trump is going to be able to stand up and he's like, America is first and make America great again. And we've leveled the playing fields and we've, they both need that agreement to where they can both go say to their audiences, let's just call them that audiences that they want. Right. And then this potential military piece that goes with that is, is, you know, it goes back behind us and there's less of a concern of that any point in time. So Scott Leith, Bob made great comments. Scott says their hand is weaker this time around, which really kind of ties to Scott's. Scott fits into one of the smartest guys I know and I know a lot of people category. And Tom, you're, you're in that group as well. But, but I've known Scott for 25 plus years and he's just a sharp dude. He's a fine finance whiz as well. And we've done business together over the years. He's a good friend. But that ties into what, what Bob was saying as well. He says U.S. imports about 300 more percent more from China than they import for us. So as secretary Besson said, if they raise tariffs, it matters far less. This is more than tariffs though. It's about IP infringement, labor arbitrage and many other things they've been doing for the past 50 years. Which is a great point, Bob, that we haven't discussed yet. And I saw, I don't know if it was just happened this week or is recording from the past, but Kevin o' Leary from Shark Tank, who's interesting enough Canadian, but he was talking about, you know, the IP infringement, right? And you make something in the US you go spend the money, you get things, you know, your, all of your molds or whatever it is built and you start manufacturing and you know, turns out that the same plant that you're manufacturing, you're paying to build your molds and your manufacturing. And this was one of his comments in this, this clip that I saw was, you know, you prove the market and this company just starts making, you know, they make your, your product in Those molds from 9 to 5, and from 5 to 9 the next morning, they've knocked off your molds and, and even might even be using your same name and are getting into the market at 30, 40% less. So the IP infringement, you know, just even you, Tom, you were talking about Deep Seek as well, right? And you know, Deep Seek in the Chinese, LLMs could care less about copyright infringement or where the data is coming from, where you have, you know, other countries where the LLMs are based and they're paying attention to those in copyright infringement and IP and other things that go with that. So there's a, a deeper set of Things that are going on here.

That's my point. Yeah, that was my point. Right. And. And there's a perfect world of what we want, but we're not going to get the perfect world.

No.

Right. So we got to be looking for something realistic. And I think realistically, if the mindset can, if they're willing to shift the mindset that says, okay, we'll at least look at Cor is, is working as a, you know, competitive something versus trying to cheat some of the things that are happening here as we just talked about. I think that would go a long way. Whether or not that could happen, don't know, but that would go a long way.

So here's a whole new wrinkle of a comment that just came in. Do you see Scott's comment there?

The second one?

Yeah, yeah. So, you know, it said the military risk could actually be president's real end game. Dramatically weaken them like Reagan did with the ussr. Right. Because they can't. I mean, China can. Look, we know that they can prop up the currency. We know that they can backstop the particular manufacturing operations that they choose to, but not for the long haul. Right. And if you go back and look at this, you know, I. Bob's comment earlier, about 300% more that the US brings in here if we find other sources for those things. Right. It's, you know, there is no long game for China in this. They have to get this taken care of.

And.

Yeah. Are we going to feel uncomfortable with our Amazon purchases? You know, I, I just literally, it's funny, I, it's because it's sitting right here next to me. I bought this little device for 30 bucks on Amazon the other day. It's, in fact, I should buy you one and send it to you or when I see you next. It's a USB C and regular USB converter, but it replaces the bigger, bulkier MacBook charger and you can charge multiple USB Cs from it. Does that matter? It does because I bought it for 29 bucks the other day. And this morning Anker A N K E R, which is one of my favorite brands, announced that they're starting their Amazon price increase this week.

Okay.

So I think we're going to see those. It's going to be a little uncomfortable for us for a bit, but I think these things all fall into place.

Well, yeah, I, I could say, I think whether the China situation, say resolved is not a right word, but starts to have some movement in the next 90 days, I think that would be a big Win. And I think all the other countries, we're not going to have quite the same drama that we've had leading up to this this week.

You know, and it's interesting. I, I don't want to put a lot of emphasis on things that, you know, neither one of us know a lot about. But I think Bob's comment here, it is into play that we haven't thought about much before. He said, you know, and this is a just a US China thing and the tariff picture is much more bigger but this is the where the big risk is. Right. He said beat them now economically or beat them later militarily. I'd prefer the former, not the latter. And I just don't think we've talked a lot about the military aspect and I think that's being downplayed quite a bit. But there is that factor.

I think that's an element to it for sure. It's not simple. Right. If it was simple, it would have gotten resolved a long time ago.

Yeah. Or we wouldn't be in this place.

But I think from, again, forget put as, as American companies. Right. And I'm seeing this already, even some conversations I'm having, we will put more manufacturing in the US it will be competitive because we'll leverage AI, robotics and things like that. Like the things that really made it uncompetitive, which was wages and costs of people get replaced when you automate and use robotics and AI. So we will see more manufacturing and some of these things happening closer to home.

Well, here's a takeaway and I just heard this this morning and I think we'd been tap danced around a little bit last week and I commented about it a little bit but didn't know the numbers. I heard this morning, this was on CNBC and it was the, the comment was that 10 tariff across the board is the new zero.

Right.

So, okay, there's no meaning the zero tax. Zero. Zero, yes, exactly. Zero tariff.

10% tariffs offset a zero percent income tax rate.

Well, so that's what, what's needed for the, the tax cut. Let's just say not zero taxes. The tax cut plan.

Right.

Tax the Trump administration because it's not just getting to zero for anybody under 150,000, it's other levels and it's corporate tax adjustments that requires 4, $400 billion in revenue. So 10% tariffs across the board covers that amount of money.

We should have just put all our money in the stock market before Trump announced the 90 day thing and we could have made that $400 billion right.

There, you know, no risk there, huh?

Yeah. And, you know, we might be insider trading or whatever, but nonetheless.

Well, I just think it's an interesting number, especially when you play some of this back. Right. And this is, I'm just going to go back and you know, it's just, it's interesting is, you know, we've, we've known each other since kindergarten, so we have a lot of the same friends from middle school and high school. And I'm, I'm watching on social media, specifically Facebook, people that, I mean, one buddy of ours that is, he's a highly respected surgeon in Southern California here, chief of staff at his hospital previously, and the vitriol venom, I mean, the stuff that leaves some of these people that are highly educated and people that are just. And my point is, and it's not to throw rocks at anybody, it's just look big picture. And I talk about this with my wife like I'm not a political person at all. I can look beyond an individual and look big picture. I have these conversations with my wife. I said, let's look at the big picture of what is trying to be accomplished versus the individual that you don't like that's trying to do something.

I think you have to scrutinize the strategy versus scrutinize the individual. And the strategy may be created by or driven by an individual, but still at the end of the day, it's the strategy that you may be, have issues with or the strategy is causing whatever it's going to cause, good or bad, but evaluate the strategy, scrutinize the strategy, don't scrutinize the individual.

This administration, I think, and I said this two or three weeks ago, this administration, I believe, is going to be the. One of the most remembered administrations of in the US either either hero or zero.

Yeah.

It's just, I think this one is going to stand out regardless. But what's interesting is, and we'll close out on this and let's go talk about inflation here in just a second, but close out on this, related to tariffs and so forth, but it ties into the CPI discussion and so forth with all of this is that again, going back to look at the, look at the strategy of all of the components versus any one action in any one event of these things and looking at the big picture of what could come out of this. And forget about the who. Right. I don't like the words and some of the things that are coming out of the administration, but look at what they're looking to get done across the board. So that's it. Anyways, want to jump ahead and talk about inflation? I know you had some thoughts. This was an article from CNBC about inflation easing in March slightly to 2.4 lower than expected. The 1. And I want to get. I know you have some thoughts on this, Tom, and I want to get to that now, but I'm going to throw this out to you. I want your thoughts on this as well because we've had some pretty lengthy discussions over the last few years on this show. But what number is today? What number show is this?

137.

Man. It's a long time, dude.

You know, just another week.

Do we, you know, you, you oversee all the finances in our company. I just look at the, the books at the end of the month. Are, are we sending all these people checks or something to come every week and hang out with us? Because it's really nice of them. No, just kidding. We're appreciative of the, of the folks that come every week. It's gracious. I can't believe we've been doing this this long, but we've had a lot of discussions about inflation and interest rates and that's the component of this administration's goals that we didn't talk about was interest rates. And I won't bring up the bet we had last year about interest rates, but let's get talking about inflation and interest rates as we jump ahead.

Well, I think there's, there's 2 inflation or 2. The CPI came out lower and the PPI came out today and it was lower.

Was okay.

It's, it's like it's gotten lost in the quicksand of the news that you've heard almost nothing about it.

Right.

Yet without all this other stuff, this would have been the biggest news of the, of the month. So, you know, last month there was a quote unquote spike in inflation this month, both on the produce producer price index and the consumer price specs, there's a reduction in inflation. All of these numbers are also kind of suspect to me because they all tend to change and move around the adjustment later.

Right.

Get the adjustment later. But nonetheless, it's like from a news perspective, it was almost like, huh, what it didn't even. No one seemed to really care. Also, interestingly enough, is you've seen the bond market significantly, the rates increase significantly over the course of the week, which is counterintuitive. What you would think if you were seeing inflation coming down is that safe.

Haven, though people are running to.

Well, no, if you'd see Safe Haven, you'd see rates coming down.

That's true, I guess.

Yeah. So as more people buy and the price increases, the rates go down. So which we are seeing it go up, which can mean a few different things. It also could mean that people are taking their money out of the US and going into other places for those things that are there. But anyway, long story short, I, I do think I had said earlier that I didn't think we'd see a rate cut until September. I am going to officially change my position on that. I think we will see a rate cut this summer, maybe two. And I think that especially we have a.

We have a cheeseburger, a tacos. Bet on this.

Tacos, if I'm not mistaken.

I don't remember the. What was the, what was the wager?

It was taco or something like that. Okay, Right. And I agree with Stephen here, the inflation is not under control for sure. Right? It's not. It's not for sure. But if we continue to see some of this, and I think again, depending upon how this whole tariff and market thing plays out, I think we will see a cut this summer actually materialize. Nothing else to add a little turbocharge into the mix and, and, you know, hopefully, and, you know, going back to the stock market, in theory, we could see ourselves back to, you know, it's not crazy to get back to, say, 6,000 on the S and P by the end of the year, you know, which is kind of where we started for all intents and purposes. So.

Yeah, well, fit anyway. 5,000, 337 as the moment we speak, it's up 1.3 today.

Right, right. But I think, anyway, there's a lot of, a lot of variables in there. I think we could get back to kind of where we started when everything gets. Gets through here.

So I appreciate all these comments coming in today. So, I mean, there is the potential. Right. And this is, I think this is the goal. Right. And what will be interesting is, is the, you know, the Fed continues that Powell keeps saying over and over and over again that we're just only watching the number. We're only watching the number. But just like there was White House pressure last year coming into the election to pressure, pressure there to cut rates, but the numbers were appropriate to do it. I think where we're at this year is now we've got pressure from administration that says, you know, regardless of what the numbers are looking like, we need rates lower. Because if, I mean, imagine, imagine the scenario that I think could, and I think it's a reasonable likelihood we could see all of this. Right. Is we are on shoring tons and tons of manufacturing. We are offsetting tax cuts because of balanced tariffs. Maybe not with their looking like today, but balanced tariffs. Right. There's major tax cuts specifically to the middle class. There's corporate tax cuts. That makes it, there's incent great incentives to do business in the US which means lots and lots of other countries are going to want to open factories here and we'll provide the incentives to do that. And the interest rates are lower. They're not going to go back to, you know, you're not going to probably find a 2% mortgage again. But if we get down in the low in the fours again.

Oh, it also reduces the cost of our debt. Right. That's the biggest thing.

Well, that's a great, great point as well.

Right. That's, that's why we need the bond market to drop.

Right.

Which is why.

Yeah.

Again, part of the squeeze that was happening earlier. Right. That can save a lot, a lot of dollars on our. And I think we have a big refinance on the debt coming up.

Here it is within the next six months.

Yeah, within the next six months. Yes. So that makes a gigantic difference.

Sorry, I'm alive.

All right.

This cough is just brutal. But I mean the. I, I guess that. So I'm going to throw, throw some stones at the statement if you disagree with this. And I go back to the folks that are. How do I put this best? I'm thinking about some of the business people and major hedge fund managers and stuff like that that were supportive of everything going on until all of a sudden now they've watched what's happened in the stock market this week and are kind of turning their back on the administration. Then I think about my comment earlier today about smart people out there that, that, you know, I'm watching that are just gobbling up headlines and clickbait without looking at big picture with all of this. And I'm kind of looking at both of those, but I'm really thinking is like just imagine the potential of that state where all of these things fall into line and what really global economy will look like, not just US Economy because, you know, a Swedish company opening up a factory in the US Is wonderful for them as well. Right. They'll continue to do their manufacturing in Sweden. They'll do more manufacturing and more business here. Right. And it's just this balancing act that could be there. But I just Think you've got to look at the big picture and then decide where you're going to cast your bet.

And I think if you were to look ahead realistically, right. Just where, where could we realistically be at the end of the year, right between now the year we may have all the things we ideally we have rates down ideally we do have some deregulation, some tax cuts and maybe those are being offset by tariffs. We have more, we have maybe a more as I said earlier, strategic competitive relationship with China versus the sort of current environment that has existed for many years. And they're respecting to at least improving the respect of how they treat our IP and the trade deficit between them. I mean it's possible to have a lot of these things which is essentially what was voted for. Right?

Right.

What people did.

It's exactly what was voted for, right.

What people and myself included. I was telling, talking to my wife about this, it's like why didn't I see this coming, right? I mean we, to change something is disruptive, right. It's going to create disruption and it wasn't just going to be a wave of a wand and everything's just going to go back to the other thing. But anyway, I think there's a chance, there's also a chance that the whole thing could go to hell. Right. So. Well that's.

Yeah, it's it. This is hero or zero moment. Right?

Right, right, right.

That's hero or zero. But you know it's funny I'm gonna take a, just kind of a personal view of this or maybe a, a self serving thought of this. We were messaging this morning, you know, about our business, right. And we're the two co founders of the company that sponsors our show and you know we've hit some milestones in our company in the last few months or Q4 of last year and then handful of things just recently and there were some tough times along the way. Right. We, we went without for a while. We wrote some checks we weren't expecting to have to write to get to the place that we're at and the growth that we're experiencing within our business. And I think you know, in a might, if you, you know, take a small little view of it, it's like there are this country and many other countries are full of entrepreneurs that have taken risk, take made sacrifices in the short term to get long term benefits. And I think what happens is when you have a business person that was elected in a landslide election, I mean I'm still astounded that you know how broad sweeping the election was. This is what the country has said is we want a businessman versus a politician. And businessmen go in and say it might be painful to get to where we want to get to. So buckle up and come along with me.

Yeah. Yes. I mean, and I think sort of the, the complaint obviously on the other side of that is maybe the lack of clarity, the lack of communication, a lot of how things are being handled, all those things. But again, I want to scrutinize the strategy, but we're going off base, so let's go back to.

No, but you know what? That. So I think let's, let's just call a spade a spade. Right? There is the potential for great things to come. There is also risk with that. The, the struggle with what's going on and how it's being done is, is the messaging and the message doing a big pivot.

Right. From a. From a startup perspective.

Yes. When you pivot the messaging. The messaging has been poor.

Yes.

Right.

The.

The messaging is poor. I mean, no matter how you slice and good lesson for all of us in our businesses. Right. If we're going to pivot and make adjustments, then we need to go ahead and make sure we understand what our message looks like and we don't have some talking heads that, you know, kind of say whatever it takes each day. So.

Good.

All right. You want to roll ahead?

I think we need to move into some other part. The.

Let's talk about something else.

Yeah.

Like, like what kind of wine we're going to drink this weekend. We'll talk about that.

It doesn't sound like you're going to be drinking any wine.

No, I'm going to be. No, probably not.

It's going to be some sort of tea or something.

Yeah.

Or Nyquil or something like that. Yep.

So you want to jump into manufacturing distribution segment. There's a. An interesting article that I was published in one of the other industrial newsletters, distribution newsletters. But we won't dive into this. But it's interesting that there's an article here and it's actually from Walmart. Again, if you don't get our newsletter each week we publish this. It's called around the Horn and wholesale distribution. You can just reach out to us directly@helloadsmartech.com or if you are active on LinkedIn, simply go to around. Just search around the Horn in wholesale distribution newsletter pop up. You can subscribe there. It'll come to your email and to your LinkedIn feed or www.aroundthehornpod.com and sign up there. But Walmart has been working on this. They talk about a $350 billion investment in products made, grown or assembled in the US they've had this in place already which is positioning them really, really well for what's going on with the tariff increases. They say their Walmart is helping over $750,000American jobs and driving long term economic growth. So it's interesting they were already kind of positioning and trying to remember who I was talking with a couple of weeks ago. But you know, and we've talked about this on this on the show before is that, you know, there is no one better positioned out there than Walmart to take a run at Amazon. And Walmart is doing more and more and more in the B2B space. Nothing like Amazon distribution. In fact, next week's show we're going to talk about it. It was too late, it came out too late yesterday. But excuse me, Amazon put out their shareholder letter yesterday and there's all kinds of hints of, in that of huge growth in the B2B space. And I think we're going to see Walmart right behind that. And, and I was laughing about this. I'm trying to remember who I was talking was. It was at ISA last week I was talking about this. And you know where we live in Southern California, I mean I have three costcos closer to me than one Walmart just where I happen to live. So we don't see Walmart the way we see it in other parts of the country but in the majority of the country Walmart is everywhere and it's everything. And they have the warehouse, the money, the warehouses, the infrastructure and the online presence to kind of start doing more and more. So it's interesting, I thought this article was interesting about how they're already behind, ahead of the curve on this.

Yeah, it's interesting. This is something I'd like to maybe we talk about at another time. If you start to see more manufacturing occurring either onshore or closer to home, does that actually open up the opportunity for more distribution? Is there greater opportunity for the, for the wholesale distribution world? Whether they're the big behemoths, the walls, you know, the B2B distribution versus the. It's interesting. Is there what would be or could there be a cause and effect between those two?

Tell me the first part of the question again. I'm sorry.

If we have more manufacturing occurring on shore, right. Does it actually increase the opportunity for the distribution side of the equation? Right. So we have the manufacturing side does it open up the door for even greater. And I think, and I sit here and think about it and I think about some of our customers, I think the answer is yes. I think it gives you greater flexibility on pricing. I think it gives you greater flexibility on pricing option or product options that are there and even how you differentiate yourself with the types of products that you're, you're selling.

I love it. Answered your, answered your own question.

Yeah, just give me enough time to.

Think it through so I'll just, I do that. I need to do that with you more.

But I do think that, I mean this point of this article and your point of what we want to talk about next week, right. The big guys are getting more into B2B. I don't think that that means the death of the regional distributor or the whatever. I think there's a rising tide. My point being a rising tide may raise all boats. Walmart sees that. Right. And is trying to see, okay, how do I take advantage of that?

I think you're, you're spot on with that. I think the other component of that is the big winner, assuming we get all this balanced out from a pricing standpoint. Right. The big winner when we think about, you know, our audience here is manufacturers and distributors, but the, and wholesale distributors, the big winner is the end user because if you're manufacturing in the US Right. Time to get right. We should be driving costs down because we have a reduced freight component from that and we have access to goods is more readily available than historically. Right. And so we put ourselves in a very great spot specifically in this country. And I think the winner on that and we talk about it, you know, as a component of Lead Smart, our product channel cloud. Right. About customer intelligence is customer wins. Right. Because distributor can get them the things they want quicker, the distributor can work closer with the manufacturer and we're in a time and place with the tools and the technology that are available. And this is a little bit off topic here, but the reality is is we are not too far away from where, whether it's a platform like ours or others where manufacturers, distributors and even end users can be communicating about their needs. So it's, I think it's a, like I said, we're either going to be in a real pickle later this year or we're going to be moving towards a really good spot in this country.

And I want to hit a couple of these here.

Yeah, these are great comments.

Yeah. How boats rise. Maybe there might be a bumpy, a little rough seas.

Right. The Road to the launch ramp for those boats is a little bit bumpy.

But. And really now with Will because he is the distribution guy. So I.

Distribution guy.

I think this is the right answer. I think distribution gets easier when more things are manufactured locally. However, it may lead to more dis. Dis. Intermediation. Right, but that's interesting. I agree with them.

Well. And, and so I will can comment again since he's here with us. But the, I think the disintermediation component of that is there is a bigger opportunity for manufacturers to go direct in that setting. And, and so that's the, that if you were a wholesale distributor, that's the pressure risk that you're contemplating with that.

But, but you know, it's interesting. I mean you say we're working with more manufacturers than ever. That's not the mindset that I get at all with.

Not at all. No, no, no, no. Well, and I think I, but I.

Think the, if anything they're looking to strengthen the relationship with and collaborate more with the distribution side. It's not, it's not to move away from.

Well, and you know, Tom, it's interesting. It's like I, I've been in the, in the world of manufacturing and distribution for 35ish years, I guess now I feel like.

For 35 years.

Yeah, but you're 10. 10 coming up on 10 years. You know, eight. Eight years. Whatever it is.

2017. 2017. It's the first time. Which was when we did the, the clean space project.

Yeah, but you, you know what, even with, you were tap dancing around co ops and doing technology.

Right. That was software. It just happened. Just.

But you're selling to distributors. At the end of the day they just sold retail and wholesale. So I'm trying to give you credit here, my friend.

Yeah, it's been years. Years. It's been years.

That's all you trying to, trying to build you up here. You know, take the compliments. But no, I completely lost my train. What I was going to say was that I've watched a handful of manufacturers that have cycled in and out of hybrid selling. That they'll, they have a, you know, a direct to consumer component and then they have a distribution component. Excuse me. I think what we're going to just continue to see and we're seeing it more and more is people will dip their toes in and say, hey, I'm going to have a presence on Amazon at a very, very high price and all of my distributors should have an online presence at a lower price and the point being is if me manufacturer, me and my brand, right. If I have a presence and a lot of them are doing this and I can think of one in particular, I won't mention them but a lot of them are doing this from a standpoint of being having an online presence because that way they control how their brand is used on. On specifically on Amazon.

Right.

That's. We could do a whole show about. And I know you have a lot of experience about control.

That'd actually be an interesting show to talk about.

Yeah. And that's me. That's why we have 2.0. We should put that on the list. But a lot of them are doing that from that component. That position of it is I'm going to protect and manage my online brand, all my distributors, you should come online here as well and have your own presence selling my products. I'm going to keep mine priced super, super high in that setting and you come in below that. And now we're, we're going to control this component of the market. So always an option. Yep.

Wanted to hit a couple more here and then we.

Yeah, that's great. Let's jump ahead after that.

I do agree with Bob is saying is, you know, you have to look at the core compsy Walmart of cross docking. If they can manage a Chinese supply chain, imagine what they could do with an onshore supply chain point. Yeah, exactly what I think they're. They're looking for.

Yeah.

And yeah, you know, allow. And again Steven's point, allow for the wholesale distribution. You look at different ways to delight the customer. Profit profitably. Right, right. And I think that. Profitably. Right. Which, how do I say this. What I'm seeing in the conversations I'm having with our customers is that they feel, and I may be feeling versus reality, they feel like they can have more control over profitability going forward than they have in the past. And I'm not sure exactly that.

A little more.

Well, it's a sentiment. Right. It's almost a sentiment. It's not as specific. There's a sentiment that exists that hey, I think we're going to be able to control better again maybe using technology and some of the things that we do, our profitability, our gross margins. Right. Things if they're selling maybe through a buying group, the rebates and the other things that they achieve through that they have better. There's, there's a sentiment that hey, as we move forward we're going to have the opportunity to have better control over some of our profitable profit Numbers and profit margins and so forth. So.

Gotcha. Anyway, yeah, it's good. So one little hint before we. There's a great article about organic growth that I wanted to talk about.

That's the best article we've ever had in the newsletter ever of all time.

Well, now you just do.

Am I going to make you cough and, and be sicker?

Yeah. Or barf.

The. Just turn off your camera. All right.

What's that?

Turn off the camera.

Yeah. Okay, here we go. All right, I'm back.

Now the.

There is a component, right. And we have a couple articles here is there's an article from Industry Today about navigating the tariff landscape with lessons from COVID And then we have another article later in, in the newsletter about port issues. Right. And the one thing that we've not talked about today, and I'm just going to throw it out there and we'll maybe revisit it next week because I'm sure there'll be be more articles that go with that. By the way, I just saw Bob's comment earlier about schnapps. It's a good idea.

Yeah, yeah, yeah.

They say nothing can live in 100 proof. So whatever bug I've got, you know, okay, maybe some Everclear or something would be good. But the. Well, we haven't talked about, we've talked about this so much over the last few years about all the issues with port strikes and so forth have gone. And now we have both East Coast, west coast and Gulf coast port contracts in place. But we're going to see dramatically fewer containers coming through. In fact, there's already a pause being felt at Long Beach. In LA harbor, there's a risk, they said, of like 10% of jobs in Long beach and LA, which those two, those two harbors, which is just a man made land spit in between the two of them. Where you and I grew up is I think if you combine those 2, it's the third largest port in the world or busiest port in the world. So there's going to be an interesting thing to watch about port activity and jobs and things that go with that. So we'll cover that as we, as we go. But there's an article that you wrote this week which I thought was great. Let's talk about a little bit organic growth, the Smarter path for manufacturers and distributors. It's posted right now on our website. You can click through it from the newsletter if you have it as well. Tom, why don't you unpack the thoughts and thinking behind that?

Well, it Came from the fact that I'm not going to say all of our customers, but I would say, I don't know what you think. 70% of them, 60 to 70% of them have all told us that hey, they have goals of doubling their business in the next five between now and 2030. Right. That's been an objective coming into the year is to literally. Which is a 15 annual compounded growth rate over five years. Right. That's not trivial to accomplish.

Nope.

But there's also been in the last, again, going back, I guess, the negative of some of this disruption and uncertainty. There's been talk that I've heard in talking with our customers, like, well, maybe some of the M and A plans that we have are going to have to go on hold or maybe we won't open that new branch right away or whatever, which are all forms of inorganic growth, if you will. It's not growing from what you already have within the company. So that was kind of my motivation and emphasis for writing this article, which is, hey, how can you achieve this still by just being, you know, growing and working with what you have already in the business. And that's a lot of what we do. Right. We help them take what they have and.

Sure.

And get more out of it. So anyway, that was the, the motivation behind the article really get people, I think, thinking more about and we are seeing this. I'm not suggesting that this isn't happening. I think this is a lot of what we're seeing. But really put, yeah, maybe it's not the best time to open a new branch or maybe it's not the best time to do an acquisition. Maybe you do need to kind of think that through a little bit more. But put the pedal to the metal on the organic growth capabilities and you still have a very good chance of achieving some of these, you know, longer term goals over the next five years.

Well, I'm going to add a little bit to that, I think in something we talk about a lot. I'm glad you wrote the article and again, if you don't get the newsletter, let us know please. And we'll get that out to. We had a handful of requests come in this morning. Interestingly as well, we've got all the things we've been talking about today going on.

Right.

So if I'm a office products distributor and H Vac distributor, electrical distributor, doesn't matter what it is. Right. And I'm thinking about my traditional ways of growing which is, you know, unfortunately still in this day and age, a lot of it is my sales leaders get together with the sales guys and they take a spreadsheet of all of their customers and what they bought last year in total dollars, and they put a number to it. Excuse me. Sorry. I'll survive. Promise.

Can you have Darlene bring you a shot of schnapps or something or 151 or something along the way?

Yeah, I'm gonna. That. That's not that it's not impossible. Later in the day, I'm gonna go to the acupuncturist. That typically helps me clear things up when I feel like this and I'm on antibiotics and stuff as well. But it's not impossible that there might be a tonic of some sort this. This later in the day or this evening for me. But my point being is that, you know, we have this historic growth that says, hey, let's go look at all of our customers and how much can we maybe grow? And we'll put all those numbers together. And my eastern regional manager, my western territory regional manager will aggregate those numbers. They'll come together to the sales manager, and the sales manager says, all right, I'm cutting that number in half. And. And then I hate to say it, but I talk to companies every day that are still doing this, right? Versus using some technology that can go uncover, right? Where are. Where am I weak? What categories am I not selling over here? And what category should I be selling and where is their opportunity? That, you know, technology like we make in all frankness, that uncovers those white space. Or we have a customer that was just. They call it trapped potential. And right now, to your point in this article, right, about organic growth is if I can figure a way out how to grow by. Let's just say, you know, we've got another customer right now that's saying, you know, hey, if we could close 5% more quotes this year, it was worth 3 and a half million dollars off of a $60,000 technology investment that's helping them to track and manage their quotes, Right? If I can grow my business that way versus the risky market right now of saying I want to go build another facility two states away with interest rates high, labor market has its ups and downs and the tariff issues and stuff going on right now, why not? You know, and I'm not saying hit the pause on growth and that's what you're saying with this article, but there's so much untapped potential for double down, right?

Double down on the organic side. That's the whole purpose of the.

And you know, what's, I, I don't know what the, what the statistics are. Somebody might be with us on the show that knows. But something like it's, it's exponentially easier to grow with an existing customer than finding a new customer.

Right?

Okay, yeah, let's, let's do that.

I listed out in there like eight or ten things that you can do, retention being one of them. Right. With the existing customers that are there. But again, it's a mindset thing to be thinking with like hey, how do I look at my growth strategy? How do I put organic first? It's not that inorganic is horrible. But I agree with what we just said. It's like it's, it's, it's a challenging environment to make those sort of risky decisions. And these are all, and talk about gross profit, right? These are all things that generally lead to increased profit or increased profitability on what you're doing at the same time without the risk that comes with capital expenses and new facilities and all that stuff.

And if you're good at what you do, right, then you've already bought coming in here about differentiating, right? If you've already differentiated yourself and you're good at what you do, why not leverage everything you can out of every customer? And so few people. I, I've said this forever, right? And I started my career working for a national whole national distributor in 1989 and in 1993 started a manufacturer's rep agency, worked with distributors all over. I've now in consulting roles and other interim executive roles, worked with global companies as well. And at the end of the day, people walk by far more business than they have. Far more business than they have. So anyways, that's my thoughts on a great article, Tom, Glad you wrote that. Let's jump ahead into our e commerce and marketing segment. You know, Chinese sellers on Amazon to hike prices or exit US Good article in there from Reuters. This is an interesting thing though. The follow up article to that was from CNBC that 70% of goods from on Amazon are from China. What does that mean for sellers?

Not a shock. Not a shock, No.

I mean I heard a 50% number earlier in the week and that surprised me. But it's interesting is that Reuters article talks about hike prices or exit US I mean, how do you exit.

I.

Mean the largest global economy in the world. I mean what are you going to go do? You know, you got to hike prices and stay here and hope for the best and figure out some way to differentiate or do something in your Business. But the idea of saying ex, you know, hiking prices or exit the US Just to me that just doesn't even sound like an option.

Are they saying like take your business out of the U.S. well that's the.

That'S the title of this article. Right. Or you know, hike prices. That's what they're. You're covering part of that in your, part of the title there and you're. How you're scrolling there. Right. But, but that was the title of the article.

I see.

Did you miss that one in your preparation?

I did. I looked at it a little bit differently. I was looking at this is whether or not the, if they were going to contain a purchase, you know, for the higher prices there. But I didn't, I didn't think, I didn't see it the other way around where it was moving the business out of the US Yeah but if it's an online. That's interesting. I really thought about it. I have to read the article more carefully. Is. I mean moving an online business is possible. So it's an interesting. I have a couple of friends that have online businesses that are on that they sell on Amazon and plus their own Shopify site and every, all their products come from Amazon or from China.

Right.

So I, I will, I will, I will do some homework on that.

Yeah. So anyways it's, you know, comment was made here about what does that mean for Amazon. I mean I, I haven't looked closely yet about the Amazon's shareholder newsletter that or shareholder letter that went out yesterday. We'll analyze it pretty closely. I haven't agent AI agent built that. I will run it through that will help me with that as well. I was reading it and we'll talk about that more next week. But how do you not anticipate that Amazon's going to have some implications of their stock prices to this? Yeah.

Right.

Let's, let's roll ahead to our technology and cybersecurity world that we talk about each week. Anything there catch your eye? Particularly?

I mean these are both really good. I don't. Maybe we talk about these more next week and we have more time.

Do you want to hold on to those for next week?

Sorry.

Should we post those again next week?

I think we should. I mean the first article. Article Here is from McKinsey. US utilities struggle to Meet Big Tax Data center demands.

Been talking about that a lot about the, the, the oh we don't need.

All the electricity anymore and all these big data centers and all that kind of stuff.

And that's just we need, we need fusion. That's what we need to power these things.

Right. But the demand for electricity and utility and resources AI use just keeps going up. Right. As the cost of AI use comes down, the use goes up.

Right.

And so anyway, we could talk a lot about. And then the next one here from CFO dive. AI agents emerge as. AI agents emerge as potential targets for cyber attackers. Some good insights in there. Yeah, why don't we hit these on another. Another week or, or whatever.

Because I, so we, we, we talk a lot about, you know, AI and then now the. What the focus is about. Let's just hit that one briefly. Right now our big focus is agentic AI. Right. So agents that. Agents and digital twins, agents that can do the mundane parts of our jobs or help us do our job faster and, and maybe even better. And so there's a risk there with some of these that depending on how you are managing these and so forth, for some cyber issues that go with that. So, yeah, like you said, Tom, we'll hold those for next week as well.

Yeah.

All right, what's. What's next on our agenda here, my friend?

I think we'll just kind of, kind of quickly go through some of these last few just to everybody know what's here and then we can.

Yeah. So there's good article, good article for sales onboarding overlooks the buy side from sales and marketing management. And really this is a good article about. And again this, all of these links are in the newsletter, so let us know if you don't get the newsletter. But this is a good one. It talks about really kind of helping a salesperson when they're doing onboarding and training within your organization to, you know, put this. The shoes on of the customer. Right. What's going on on the buy side. And it sounds pretty rudimentary, but it's so, and it's a, it's, it's not a deep, deep article, but it's, it's good thoughts, you know, and sometimes it's. Sometimes the most important things that we can do really bring into our lives are the things that seem simplistic, but where they seem simplistic, but we're really not even doing them. So I think that's good. Another though, this article from Inc. Right. Inc. Magazine talking about is MNA flow at risk of becoming like molasses? Right.

So we were just talking about.

Yep, exactly. Right. The, the mergers and acquisitions world was looking really, really strong.

The.

With it, with the thinking at least was with this administration and you know, getting ready rid of the FTC commissioner that was there, Lena Khan and the wrath of Khan so to speak and her tightening the reins on M A activity and the big, big level. Right. But even on the short term level it's with the uncertainties out there does put some risk right now on slowing down M A. So why don't you pick a one or two out of our people in leadership and we can hit those real quick to describe those Tom and let's start to wind down for today.

Well I found the second one. Well the first there's three articles. One talks about AI and hiring and basically this is the Shopify CEO talking about hey before you have to. If you're going to hire somebody or you're going to put in a wreck to hire somebody you have to prove that you cannot get what that person would do done with AI So you have to prove and, and, and justify that you're going to. You really need that person related versus you know, you doing it or replacing or augmenting it with AI.

Prove to me we couldn't do this with AI.

Right, right. Right.

If you want to hire somebody prove to me that AI couldn't do the job.

Right. I think there's going to be more of that. Absolutely. I think there's a lot of kind. It's like all of these things we could end up with a whole hour discussion on, on these things that are here. I think there's a lot of short sightedness that probably is taking place related to that as well. But, but I do believe there will be more and more of that. Right. It's not just going to be justify the position. Right. But justify, okay, maybe you need the help but justify how you get the help and is it an agent or an AI facility versus a human resource?

I, I think you know, as we wrap wind down kind of today I think this goes back to our broader discussions about AI in general with these things. From a standpoint that sounds like Cooper thinks highly of this topic as well. He was just letting me know down the hall there my can't be replaced.

With AI he won't be replaced with AI he's good. Yeah, I'll tell him a robot dog or whatever.

I will we absolutely. What was the Jetsons dog name?

I wasn't, I wasn't around for the Astro.

Astro was what it was. No, he will not be replaced with Astro. But, but the, the gardener might be.

The gardener might be.

Yeah, the gardener might be. And it's looking closer and closer all the time with that. But you know, I think what, what really comes of this is that there's organizations right now, including ours, who is looking, looking at every activity within the organization that says how can we use AI to augment. Right. And really even getting ourselves in a place where and I, I'm not, you know, I'm not in an idea or a place that says hey, we shouldn't be hiring people, but it's who do we hire and how can we use AI to assist that? And can we really get ourselves in a place where and I use our company as just a great example. In fact, I was chatting with somebody this morning about this is that, you know, we have a fraction of the employees that most technology companies would have based upon the revenues and number of customers that we have because we use, we're highly efficient and we use technology, our own technology to organize and run our business. So it's really, really helpful from that standpoint.

So. Yep. All right, Anything here?

You know, some good, good news that on our channel, movers and shakers. Just quickly, Steve Goodry from IDRI from Affiliated Distributors running the electrical division there is Moving over to McNaughton McKay RSU is the big industrial distributors. CEOs retiring. They've got to move there. So some good movement there. Handful of things in our industry scuttlebutt section there. You guys can can hit that in your as you peruse the newsletter. So I think that covers us for the day we have our second look in our Goodreads. The Goodreads section I think is interesting is what Roman entrepreneurs can bring to today about how that the business was done in the Roman Empire. So I thought that was kind of cool. So always love putting in something unique and different there.

Well, some good discussion for such a dull Newsweek.

I think we're sorry about the sniffs and the coughs and the things that go with that. Next week.

No, no planes, no sickness, just back. Back to regular.

Yeah. Yeah. Well good.

We have some guests possibly coming on right. That are some.

Well, yeah, I was not going to mention it, but I will. I don't know for sure. It might even be just a recording that we do during the week. But Brian Wild with leads the legislative group with the national association of Wholesalers. We've been messaging all week. Obviously he's back and forth between Capitol Hill and their offices every day. Naw, had a board meeting this week. It's no, it's not unreasonable for me to say because lots of people were commenting about it on LinkedIn. So we weren't able to get him today, but we looks like we might have him either as a guest next week or we'll record something with Brian and he'll give us a little inside take on tariffs and other things happening in Washington.

I'm very interested to hear the.

Naw, he's a. Brian is a no nonsense guy. He's just, you know, easy to listen to and, and just a straightforward guy. So that will be good. We've got a ton of other great guests coming up over the the rest of the year. They're lining up nicely, so we'll go from there. So. All right. Like in closing, I like Bob's comments Schnapps. So that sounds good to me. Yeah. So anyways, thanks again everybody for being with us. Kevin Brown and Tom Burton. We appreciate our sponsorship from the company that we both work for, Lead Smart Technologies. If you or your company are contemplating expanding your digital transformation and really understanding your customers better, your team better and trying to accelerate growth, we would love to get organic growth. Don't forget organic growth, nor anything that Tom writes.

That's right.

We always want to make sure we read so. But we would love to talk with you and share with you how other wholesale distributors and manufacturers are understanding their customers better and really getting insights into their business that they've never seen before. We'd love to share that with you. So Tom, my friend, appreciate you. We'll talk more later in the day. Everybody have a great weekend. Be kind, be safe and do good things.

Yep. Thanks everybody.

We hope you enjoyed today's episode and our guests. Each week we try our best to dig into the tank topics that are impacting your business. So please reach out to us and let us know how you think we can make the show better or topics you'd like for us to tackle or talk about more often and even guests you'd like to see join us. We're looking forward to bringing you next week's session and hope that until then you stay safe, stay focused and do great things. If you haven't already, please subscribe to the podcast and leave a review to help others in hopes wholesale distribution get access to the conversation. And finally, please check out our sponsor, Lead Smart Technologies and their manufacturing and wholesale distribution industry CRM Customer Intelligence and channel collaboration platform. That's Lead Smart Technologies atLead smart tech.com.