The Challenges of Thought Leadership in #AI, #Marketing & #Manufacturing

Welcome to around the Horn in Wholesale Distribution with Kevin Brown and Tom Burton. Sponsored each week by LeadSmart 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.

How are you this morning, my friend?

Okay. Okay. Cold and misty here, but otherwise okay. Well, you know what, nine degrees and misting. So how much?

What's the temperature?

59.

Oh, 59. Okay. I thought you said 49. At first I was like, wow, I changed a lot since I was in Santa Barbara earlier in the week. It's pretty similar to that down here in Orange County. It's not drizzly, but supposed to be a nice Mother's Day on Sunday. So I look forward to that. Be nice, get out in the sun a little bit and enjoy the day. So anyways, let's dive into our day. I'm Kevin Brown. This is my lifelong friend, business partner and co founder of Lead Smart Technologies, Tom Burton. We get together every Friday morning, well, nearly every Friday morning if we're not stuck on airplanes or heaven forbid, we get a day off here and there. But we get together each week and we discuss the news going on in the U.S. north America, the Americas and the world. And kind of take that and look at that, how and how it impacts wholesale distribution and manufacturing. So we in reviewing that, we are reviewing a newsletter that we put out every week. Every Friday morning we get out to about 10,000 plus people. A newsletter, it's called around the Horn in Wholesale Distribution and Manufacturing. And we take news clippings from all over and we consolidate those into things that are important to distributors and manufacturers. If you don't get that newsletter and you would like to couple of simple ways to do that, you can certainly send us a note here on the broadcast. And by the way, if you're with us live this morning on LinkedIn or YouTube or Facebook, send us a note, let us know where you're from and hopefully we can see that. We'd love to get a hello and know who's with us, but we get that newsletter out and then we go live on Friday mornings and we review the topics. Tom and I get some feedback. We regularly have guests. We have some great guests coming in the next few weeks and we try and decipher that. And what does that mean to Wholesale distribution, manufacturing. So those ways you can get it, send us a note here, send us an email to helloadsmartech.com or go to the website for the podcast, which is www.aroundthehornpod.com and we will get you that newsletter. That list is growing every week. Tom and I both work for a company called Lead Smart Technologies. We couldn't do that this show every week without their support. Who sponsors the editors and the producers and the people behind the scenes that make this all come together for us? So LeadSmart is a AI enabled customer intelligence and CRM platform that allows wholesale distribution or distributors and manufacturers to gain deep insights into their customers, their teams and their overall organization to help drive better decisions and drive revenues and growth forward at a faster rate than they've ever seen. So if you'd like more information on that, you can certainly reach out to the team at LeadSmart. So Tom, what did I miss? They cover all that?

Good. Let's say good morning to Tyler from Southwest Virginia. Thanks Tyler, for checking in. Yeah, definitely like to hear from you if you're out and about. And it seemed like the comments came through a little bit better last week, but then I went back and looked after the fact and not all of them came through. So I. The, the LinkedIn dilemma continues to move on.

But anyway, well, very, very good. Let's, let's kind of dive into our newsletter that we cover each week here. And this week's episode we kind of start and we break this newsletter down into a bunch of different categories but we start each week with our information about manufacturing and. Excuse me, and economy and supply chain. Tom, what's our first article there for this week?

You know, yet you had another, another one of these wholesale wholesalers down 1.3% month to month. One point. Up 1.4% year over year. Another one of those confusing statistics that don't really tell us a whole lot.

I, I've come up with a new conclusion of what we can call all these things, whether we're looking at consumer pricing or the, the, the purchasing manu. Manufacturer Purchasing Managers Index. Whichever one we're looking at, they're the roller coaster and a kitty. The kitty ride. Roller coaster. Right. They've got ups, small ups and downs. There's no big bikes ups or downs. Right.

Yes.

Kitty. Kitty Park Roller coaster. That's my new, my new thing. So you know, this did talk about though, the fact that wholesaler sales were down 1.3% month to date, but up year over year. So you know, what does that mean, maybe it means some simmering, maybe it means some maybe a little more caution. We've talked in the last few weeks a little bit about a little bit more caution. I have to tell you, none of these things, I think, impacts enough on our bet about interest rates this year. And just for those of you who are with us regularly, you have heard us bantering about Tom's view of only one interest rate cut this year, and I'm at 2 or more. The bet is for a steak at Chuck's Steakhouse in Santa Barbara. So Tom and I got together earlier in this week to do some business planning in Santa Barbara, and we ate at Chuck's and the company bought the steaks that night. But just preparing, just preparing. We're just getting our pallets ready for who's buying, who, what when, when it comes time. So but we did have a little bit of that discussion. But, you know, it does it's interesting in these reports as they do come through, that they give us some good view of kind of where the ups and downs are. Right. So the growth during this period was in automotive category is the one that that grew the most. And the decline was in metals and furniture. So then in the places we pay the most attention to, typically with a lot of both lead smart customers and our audience here, there was they described it as mixed performance among durable goods, electrical, professional equipment. Those all displayed some moderate growth. So it's interesting as we look at all of that, we'll just have to kind of keep our nose to the nose and ears to the grindstone about what's going on out there and what's happening next.

Yep. So again, not nothing really, earth shading, earth shattering one way or the other.

No, we've got to be paying attention to these things. And then, you know, so we kind of go to the next article that was from Reuters, and it talks about us wholesale inventories dropped by 4% in March. You know, that's an interesting thing too in looking at that article. I think there's a little bit of a misnomer in part of that as we see this. And basically what they're talking about is, you know, a 0.4% inventory decline in March over the increase that they had in February. But, you know, super minor impact on gdp. The article talks about the declines again in inventories tied to motor vehicles, metals, hardware, papers, some other similar items like that. In the arena of a lot of the folks that deal we are regular commenters and viewers here is petroleum, lumber, machinery and even computer equipment increase But I think the balancing act here for me, Tom, as I look at this, the focus here is there's also some right sizing still that's going on as we talked to some of our customers and the distributor wholesale distributors that we work with is they went through that pandemic level, many of them, especially when you get into the safety and some of the industrial segments that they were just getting their hands on everything that they could. Then they got stuck with some inventory based upon supply chain issues. And now inventories, I think are doing some right sizing. So I think a little bit of this is part of it is right sizing versus headwinds in the economy.

I don't know, I mean, you may be maybe right on that. I think a lot of the right sizing though, has been behind us. But what I found interesting about the article, and you may have known this already, but what an impact inventories have on gdp. And so a little change in inventory, you know, in inventories or can have a major impact or a significant impact on gdp. And GDP is obviously a key indicator that we look at from an economic growth and an economic situation. Yeah. So in some ways I, I think that's an, a statistic that we should keep an eye on a bit more as we move forward because I think it can tell a bit more of a story than maybe I understood. You know, this article really helped me to understand is some of this inventory data, while it may not be a large drop or a large change, could have a significant drag, as they say, on the economic growth.

Yep. Well, and this one talked about it, you know, the economy growing at an annualized rate of 1.6% in the first quarter, the slowest in nearly two years. So yeah, that could tie into Tyler's comment here about who's going to win the stake.

Yeah, so he thought he was. He thought I had it, you know, in the bag. But now he's thinking maybe that you might, might use, might squeeze something out. But you've seen industrial MRO marketing market is, is flattening.

So.

Yeah, interesting.

Yeah. Tyler, when that, when that second rate raise or second rate reduction comes in this year, I'll raise a glass to you on this as Tom's buying the wine and the steak, so. Very good. All right, what's next, my friend?

Planning fatigue. I thought this was a very interesting article. Yeah, I mean, I think there's. So let me bet, let me back up. So basically the gist of the article is, is that companies are, are planning more, they're Spending more time planning. They're looking for and trying to plan for some of these, they call them black swan events and situations like bridges collapsing and things like that. What is interesting in reading that is that it's basically saying that a lot of companies are kind of getting in that, you know, analysis paralysis. And I don't know if over planning is the word but because they don't really know how to plan, it kind of goes around in circles. And we see this not so much in these, you know, executive things, but we see this frequently as a lot of over, over planning. And I think it's, it's the first time I've heard of that or I've heard that of that situation. But I found it quite intriguing as I went through that article.

Yeah, well there are some good, some good resource data in here and it talks about from a. This was a survey that had been done. In fact this was Board International is who did this survey for 2024. Global Planning said 73% of senior supply chain professionals are emphasizing scenario planning due to heightened global risks like the Ukraine war, cost of living crisis, ongoing supply chain disruptions, et cetera. So they're talking about the things additionally deeper dive into this as far as threats were cyber attacks, labor shortage, fluctuating oil prices and then again disruptions and blockages in the supply chain. But to your point, right, is we, and I remember we had one of our guests that was on a while back, Mike Mortensen was talking about, you know, from Mike's with ARG Industrial in the Pacific Northwest in Alaska and he was talking about, you know, sometimes monthly and weekly review of supply chains versus the quarterly or maybe a couple times a year. There was a really interesting point though that really caught my eye in this article article and it said many organizations, 77% was the number, are relying on assumptions instead of data driven scenarios leading them to focus only on likely risks and not extreme events or as you said earlier, black swan events. So they're relying on assumptions versus their own data, which just means that's something that they need to be thinking about is do they even have the data? And if they don't have the data, what should they be doing? What should they be thinking about?

Well, and that's where the planning fatigue and the analysis paralysis comes from. Right. At least if you have some data, you have some objective way of going about planning versus subjectively putting in opinions or even, you know, and unfortunately right, even experience may not be a very valuable commodity here because it's a very different different situation.

That's a great point, Tom. You know, if you, as you think about that. Right. Is what you think, you know, is a very different world. And, and probably that could, if you took someone that has been in and around the business for a long, long time, you know, we've got executives on the purchasing and supply chain side, well, all sides of the business. But, you know, it's not uncommon to see people, you know, old guys like us that have been around in a company for 30, 40 years. Well, the world is different. Right. And, you know, some of these people went through us, Focused on manufacturing in the US and watched that migration to China and Southeast Asia, and now we're starting to watch it come back at the latter parts of their career. But how things work is different. You know, I mean, I, I don't remember it. Good.

No. It's interesting about the data part, and I don't want to take this down an AI rabbit hole, but I've been doing a lot of homework.

But you will.

But I will. A short, a small rabbit hole, maybe a gopher hole. I will. I've been doing quite a bit of homework on the upcoming chat GP or OpenAI. GPT5. Right. So we're on GPT4. One of the things that, and supposedly, from what I can tell, it's literally orders of magnitude improvement over what is GPT4. But one of the things that they're talking a lot about is that the GPT5 capabilities will be able to analyze a lot of data and do a lot of planning and strategy, type of activities. So I think, you know, their point there. Right. Having that data as these types of capabilities come out, it then opens the door to taking advantage of some of these more robust AI capabilities in the future to really do some real, real intelligent planning as it goes forward. Because that's a lot of where this is, is heading.

Yep. I think that is absolutely the case that the reality of what we face today is we've got geopolitical conflicts, major geopolitical conflicts. You've got port issues certainly in the east coast right now. You've got, we've talked about a month or so ago, the potential of a strike in the Gulf coast and the east coast, in the ports.

Right.

We have a tenuous, continuing, tenuous labor situation on the west coast, though. No big threats right now. But then you've got China, Taiwan. You've got all of these things going on. Right. And paying attention to exactly what's happening in your supply chain is critical. Tom, we skipped an article that was kind of a lead in to this particular article about that. Right. Which is the article about US trade tops 200 billion in the first quarter of 2024 with Mexico. So big, big trading partner there always has been and we need to be paying close attention to that. And the realities of this is we're seeing that growth go more and more and more into that arena. And so we need to kind of be paying attention to that. And there's a couple of great takeaways from this article. And this article spent some time talking about, you know, which are the different ports of entry are, are the strongest and so forth and talking about Laredo and, and Ote Mesa just not it's an hour and 15 minutes south of me. Eagle Pass, I know an Eagle Pass is Texas is where a whole lot of the, the in the Machilador region there. There's a whole lot of, of clothing manufacturing going on down there. And that's where that's a lot of that's coming across. But as these numbers are rising, and we talked about last week an article as well about, you know, imports more and more coming in from moving from China, manufacturing moving from China to Mexico. Couple of things. I think that my takeaways from this article in the last few weeks are two things. One is we talked about the geopolitical issues of the pressure that I guess it would be tied to and I'm far from an expert on this stuff, but the pressure tied from China and Taiwan that the US Is having some involvement in and more and more pressure of US China if China starts doing more and more in Mexico and Mexico warms up to them, US has got to pay attention to that because there's a big issue with that. As we talked about on last week's broadcast, excuse me, about trying to get around steel tariffs. That's an issue. But there's another issue that this article talks about that we don't talk about as much. And this has been something that's been paid attention to probably as long as NAFTA has been around is the ports of entry. Right. So if you've got border challenges, which if you've crossed the border into any of these locations and I'm down in Baja California three, four times a year typically, you know, it can take you three, four hours to get across the border at some points. So I think there's and it's not just the border crossings, but as we're watching this, it sounds really great that we're near shoring all of this manufacturing into Latin Mexico and or Latin America. But is the infrastructure there to really get it across? And I think what we'll probably be talking about, you know, in the coming months is, you know, investments into the infrastructure there.

Yeah, no, it'll get figured out. I agree that probably right now we're not ready for it or we're not as ready for it as we should be. But that's one of the things that will get sorted out, I think, pretty quickly.

Yeah, good. All right, well, something to be paying attention to as we're continuing to watch reshoring and near shoring. So good stuff. So we're jumping into our manufacturing distribution segment that we do every week within our newsletter here. Kind of an interesting article about this gigantic 3D printer. It's an article from Fast Company that says could reinvent manufacturing. I thought it was pretty cool to kind of watch that and some of its capabilities. Any initial takeaways before I dive in a little bit further on this?

Well, I think let's talk a little bit about what it is. Right. So it's a printer. I'm not even sure is the right word for it, but basically it's a big tool that can manufacture what was the sizes I don't have in front.

Of me but like 96ft long.

Yeah.

32Ft wide and 18ft high. And I think, you know, if I can dive in for just a second before you continue is I think most of us think we've seen a 3D printer in a YouTube video or maybe you even seen one of friends. I have a couple friends that have them and you know, they're boxes that are, you know, 24 by 24 by 30 inches high with a, you know, a little reel of plastic on the side that's getting melted and form something. Right. This is very different. 96ft long, 32ft wide, 18ft high. So go ahead and continue.

No, and so I think it said it could create a 600 foot house in four days basically by going through that. So this to me is. I don't know, printer doesn't seem like the right word.

Yeah.

But it seems like a very interesting tool. And what I found interesting, and we were talking a little bit about this before, this isn't just about building prototypes.

Right.

This is actually manufacturing. Could be parts, it could be, you know, really anything. I don't know what it cost. It wasn't clear in there exactly how much this type of thing costs, but you got to figure maybe, maybe expensive now and it will come down in price over time. But this seems like a very different and new way of manufacturing. Yeah.

What I think you're spot on. What might in look for me, in looking at that, what it was I think about is okay, well do you need a 96 foot long one to do all of these jobs? I think what's interesting for me is how big this is. But now once that's proven and most importantly is it's not just, you know, the reels of different colored. It's just thinking about that we're working closely with one of our large newer customers and the project manager, she has one of these in her home office, one of the smaller ones and prints all kinds of. But we're not just talking about reels on the side of different colored plastics to make things. There is all different types. Right. And I think they're talking about the, the house, is the house, is it using concrete to pour right out of this? But they're talking about reducing carbon footprints with different bio based materials that are going through it. Without spending half our show on this today, I think for me what the interesting implications are is, is that really it talks about an integrated approach where you can think about wiring and plumbing systems rather than just a specific structure or product. What does that mean? You've got back to our article earlier about all the manufacturing in Mexico. I used to do some work, some interim executive work with an electronics manufacturing company in San Diego that had a big presence in Mexico. They had a plant in Mexico as well as the US where they built wiring harnesses. All they did. And it's the stuff that the cable and the satellite companies use. Well, if you look at all of them, auto manufacturing in Mexico, such a big part of that is wiring harnesses going through your car. Think about, you know, we've probably all seen pictures of a Boeing plant and you know, behind what we see in an airliner, you know, as a plastic, you know, housing between that plastic that you see in the fuselage and the main structure of the airline is nothing but wiring harnesses. And you know what? Machines, especially machines that have quality assurance components with that are AI driven in them are going to make far fewer mistakes. And when you look at a plane that probably has miles of wiring in it, those harnesses could now be potentially built by a machine of this type. So I think that back to your comment earlier about AI can drop in almost all of our conversations today is now you're starting to see quicker, more efficient AI is helping the quality on all of that. Pretty cool stuff.

Yeah. And so I have a Question for you. Does this as it relates to wholesale distribution, does this open the door for distributors to kind of move into this world of manufacturing and build private label products or things like that? I mean, what does this do? It certainly seems to remove some of the barriers that would traditionally exist with manufacturing complex equipment.

Insightful question. So I, you know, one guy's opinion, but I've been in this market for 30 plus years. Here's what I, here's what I think you could see. And I think what you should see is how I'll answer your question. I think what you could see is a lot of distributors that start saying, hey, you know what, for a half a million dollars or $1.25 million, I can start making this component that we sell so much of. I can lease the building next door and start doing that myself. And I can see somebody going down a path of that of trying to do more and more of that and then losing sight of what their role in the supply chain, in the marketplace is. What I think people should be doing in that setting though is much more likely tied to. And we had a distributor I referenced earlier. Mike Mortensen was on, you know, and a lot of folks in the both in the low voltage electrical world, high voltage electrical world from a distribution standpoint. And then when you talk about hose and fitting distributors and so forth, they typically will take, you know, this manufacturer A, manufacturer B, manufacturer C's products, configure them together into bundles or packages. I can see some of that happening where maybe it's like the only thing I buy from this manufacturer is this component to go into a bundle. Boy, I could eliminate the. And it's something that we do day in and day out. But it's. Why not eliminate a vendor if I could.

Yeah, makes sense. Yeah.

But getting too wrapped up in it. I can see people chasing a shiny object.

Sure. And it's not obviously it's early. Right. And I'm sure there's flaws in it and it doesn't work exactly the way I think they even said it's a 1.0 version. But obviously it's just going to keep getting better.

That's exactly right. And I think this might be a great use case in that setting. So before we leave leave this segment, we have another article here in in. By the way, this might be a good time to interject. I'll do it a few minutes earlier than last week. I did it quite late. Is if you're listening to the podcast on Apple Podcast Spotify, whatever your favorite Format is what you're not seeing is that Tom and I are live. And when we record this, it's 9:27 Pacific Time on May 10, 2024. We have an editor and we have a producer that takes all of the data that we've put together today to put this onto the podcast. And what we're doing though is we're reviewing live. Up on our screen is a newsletter that we publish every week. It's called around the Horn. In wholesale distribution and manufacturing, we consolidate a lot of the news from around the world about the economy and M and A and sales and marketing and AI and technology and 3D printers and, and people and leadership. And we talk about that in this format each week. So if you don't get that newsletter and you'd like to send us an email@helloadsmartech.com you can go on to the website for our show, which is aroundthehornpod.com www.aroundthehornpod.com and you can sign up for the newsletter there. And we'd love to have you with the thousands of others that get that newsletter. So diving into this kind of our last topic here before we get into E commerce and marketing and this ties into our supply chain issues, manufacturing. Quite a few things here is talks about Milwaukee Tool had some work gloves seized by the government and they were doing that because it was tied to forced labor from prisoners in a Chinese jail that were making their gloves. It turned out so am I. Did we publish this to slam on Milwaukee? Nope. Because that could say DeWalt, it could say Diamond Dam, it could say Tom and Kevin's gloves. It could say anything that people go out on private label. You've got these types of risks that go with that.

Yep. So it's just another, another form of again, potential disruption and understanding your suppliers and understanding the supply chain. I don't know how you would. I don't know necessarily how they would know all of this until after the fact, but I guess if they had some idea of, you know, how they were operating and possibly. But not. Not sure.

Yeah. Well, you know, it's interesting. You've got, and I won't name them, but you've got organizations, some of the publicly traded folks in the industrial distribution world. They've got hundreds of people that are in offices in China that are working on and trying to manage and, and these are distributors. They're private label relationships there. And I think one of the challenges comes in and I just use this, the article talks about the company involved with this is called Shanghai Select Safety Products Company. Okay. So you and I want to get in the private label glove business in this case. So we go to check with a handful of other people that we know maybe through one of our buying groups or trade association, we know other people that are private labeling gloves or safety glasses or boots or whatever it might be. Right. And say, yeah, Shanghai Select Safety Products Co. Ltd. We've worked with them. And you go over and you meet with them, you tour the factory and so forth. Common, common thing. But here's what the caveat is. It says the name of the company in the article and it said and two of its subsidiaries and what you don't know about when you go visit with that supplier is his Cousin has these two factories and they do business for the last 20 years with these other factories. You might not even know about them unless you do a deep dive. And you know, we were talking about that earlier about that article about fatigue and managing supply chain is you've got to dig deep on these things. Right. And that's, that's the case, you know, when we, especially when you start talking about issues with human rights and so forth. It's one thing is, you know, did they falsify their, their certification from, you know, a government organization here in the US that they say they have? There's all kinds of implications that can come with this, especially when you start dealing with safety issues.

Sure.

You know, if it could be something that could cause a plane to fall out of the sky or you know, something to not protect somebody's eyes properly or whatever it is. So, you know, supply chain management, maybe that's a great career for young ones to get into because understanding this is a big deal.

AI will take care of it. All right, let's move on.

AI the answer to everything. What do you want for lunch? I don't know. Let me ask ChatGPT.

You know, it's funny you say that. One of the biggest use cases right now with chat GPT and chat GPT4 is to brainstorm. People are using it to brainstorm is, is innocuous things is what should I have for dinner or have for lunch or what should I do with my job or what should I do with a relationship? It's one of the biggest use cases which I anyway, I find very interesting. All right, let's move on. I'm going to digress.

Well, you're going to get to talk about AI more in the next upcoming articles. We're going to move into our E commerce and marketing segment. Interesting Article here from Yahoo. Finance. 76% of marketers expect budget growth in 2024. What are they going to do with the budgets tomorrow?

Well, they're not expecting large budget growth, so it's. They're expecting, you know, I think marketing budgets got cut a lot the last couple years. That's obvious. Unfortunately, one of the places that tends to get cut first. But they're definitely looking at investing more, guess what, in data and getting more data and, and using data more in the marketing front, which I think is good and bad in the marketing world. And having owned a marketing agency, it's very easy to skew data to what you want it to be. So the key in the marketing world, and I'm sure, I'm sure this is true in other areas, but it is true in other areas, but in the marketing area, really making sure that you're looking at the relevant data and the data that you're not using it just to make yourself look good based around, you know, a vanity metric that you want to. From a marketing perspective. But right. Anyway, that's, that's not really the point of this article. The point of this article is budgets are increasing and more emphasis is going on data, which is great. Now it's just a matter of the quality of the data and how that data is actually used to actually drive sales and drive growth versus proving, hey, look at me, I'm a great marketer.

Yep. So top priorities and challenges that they talked about. 66% of marketers identified improving data quality as the primary focus with 60% of it of those respondents saying it's their biggest challenge. Then they looked at balancing authenticity and using AI. And we're going to talk about that a little bit further in the next article as well. But it says balancing AI usage with brand authenticity is crucial. You know, the print and design and marketing whiz that allows me to continue to live in our home for the last 20 years. My lovely, wonderful wife. We were just talking about this the other day about, you know, all of the content you're starting to see. And I think this is just the cycle, right. That we're going to be going through. But the content that we're starting to see on LinkedIn and other formats that just is just so clearly all AI driven. And I'm the big proponent consistently about using AI as that help get rid of writer's block and are struggling to get something started. But man, you've seen just this cut and paste stuff continuously. That and it's. I think what it's done is made people write much longer content as well. And we're gonna. The next article we're going to talk about is about content and it just astounds me. And then I, I didn't realize this because I've. And maybe that's a good thing because I've only used Chat GPT or and some of the other tools enough for Gemini and so forth for outlines versus writing things for me. But I didn't realize this, but Darlene was mentioning this to me the other day is that you know, some of it even chat GPT and some of these other tools, they'll drop the emojis or icons right into it as well. And that's. People are copying and pasting just all of that together. It's like not a good look necessarily.

Yeah. So that's. And that's just lazy marketing. Right? That's just lazy, lazy stuff. I know we're going to talk a little bit more about that in a couple minutes but let me hit a.

Couple of the last things that it talked about in this article but kind of tied to implications of it. So data quality personalization strategy is important so we really understand what our messaging is to what audiences, AI and authenticity. We just finished talking about that generational training. So training to support across generations that will build more cohesive strategies. Right. So if you have a 50 year old and a 20 year old working in their own silos, you're going to end up struggling. If they're collaborating, it's going to be better and then a drive for innovation. So innovative tactics. They talked about exploring new technologies to differentiate their marketing. So I thought that was a good article.

Yeah. And just one last point before you related to data, you know, we, because I spend my life working with our customers and their data, what we're finding is, is that quote unquote sales data, order data, potentially even invoice quote data, things like that. There's a lot of good data there to actually drive marketing. So a lot of times marketing data is thought of well, who's on my website or who's reading my emails or who's reading my content. And yet that. And that. Or who's, you know, engaging with my Google Ads or whatever. Well that is data that can be rated for marketing. There's a tremendous amount of data, especially in our industry that can come from your sales and your transactional, financial transactional data that can also, we're finding drive a lot of good marketing decisions and marketing actions. So something to keep in mind. Well, we can, I'D like to do a deeper dive on that at some point because they're not, they're not separated. Right. It's like marketing. What is marketing's job is to create more demand and to build your brand. There's a lot of data that can be utilized from the sales side of the fence that can help facilitate that.

So that's great. Good, good stuff. So next article. Thought leadership is on trend, but few can pull it off.

Well, I think that's exactly what we were in some ways what we're just talking about. So first of all, I thought this first point, an overwhelming majority, 9 in 10 decision makers or C suite executives are moderately or very likely to be more receptive to sales and marketing outreach from a company that produces high quality. High quality. Right, right. So, and, and the reason is, is because if you have already had a, if you are already exposed to the thought leadership, you're starting to build trust in the company that you're working with. You're starting to get to know them and you may even have some interest or demand or if nothing else, some intrigue in what they're doing. So you're definitely getting a head start. As we know. As you just said though, thought leadership is not going to chat GPT and say write me an article about blah and copy and pasting it and putting on there. So thought leadership to me is now it's always been about quality, but because the quantity has increased so much, the importance of the quality to rise above that noise is even higher. And that's really what this article is talking about.

That's great. Very good, solid stuff there. I liked it. In fact, I was appreciative. Lindsey Young with 3 Aspens Media who's been on the show before and will be on again soon with us, she actually wrote some notes about this article on LinkedIn this morning that she pulled from our newsletter. So appreciative of her doing that. I just think this is there's such an opportunity for brands to become thought leaders. And you know, I think about it with us at Lead Smart is we do an okay job. There's so much more that could be done. But there is, you know, one of the highlights that I looked at this is talked about the rise of low quality AI content that creates opportunities for people to be authentic with high quality thought leadership and ability to stand out. Right. And there is when you look at platforms, whether it's video content on TikTok or it's Instagram posts or it's more deeper content that you're putting out on, on X slash Twitter or LinkedIn or whatever the platform that you use is. And there's going to be more and more platforms coming out regularly. Is, is that authentic authenticity. And I think people can, people can see quickly through, you know, I had an agency do something for me or it's just true thought leadership. And then even so this gets even more powerful. And I know you know one of the podcasts and I can't remember. Tom, what's Chris Walker's podcast title?

Revenue Vitals.

Revenue Vitals. Great, great podcast. If you're and I'm going to suggest this is a great podcast for executives to listen to because so often as executives, and I've lived this my whole career is we watch, you know, 20 year sales veterans all of a sudden get the title, you know, director of sales and marketing or VP of sales and marketing, but their focus is on sales because that's what they know. And then there's this marketing component and marketing might be three social media posts a week and a blog post on the website once a month and they publish the blog post on a, on their website and that's their marketing department and then they take care of trade shows and catalogs.

Right.

That's. That is probably the standard across the board in wholesale distribution. But when we can start having executives understanding the opportunities for authentic content development and thought leadership across social channels and across your marketing message, that includes the senior executives in an organization. It includes a CEO that is on, consistently on and it doesn't matter the size of the organization. You could be a, you know, a five person organization and your CEO has a relevant presence on social media or you could be a Fortune 100 company. But if your leadership understands this authentic opportunity that we have to develop thought leadership, it can change the perception of brands at your customer level.

Sure. But it has to be done with high quality and authenticity and you have to reuse it to rise above the noise and otherwise you're just adding more to the noise, which is kind of the key thing of the, of the article here. But anyway, yep.

I think this must be. We're seeing this on our screen that says it resonated with me so much great content. I think that might be Lindsay that popped that in there. It's just we're not seeing who that is. But that's my assumption. And I can see this on my other device. That was Lindsay commenting on that.

In fact.

Tom, Mitch, pop that up there about that other comment. Google is now deprioritizing largely AI non differentiated content as well. So there are a lot of reasons to invest in better, higher quality original content. Lindsay, any possibility you can help people do that? I thought so. Lindsay's company does a great job working with a lot of great brands with that three Aspens media. So good stuff. Let's kind of jump on. We're going to actually there's a few pieces related to this that we're going to talk about as well as we talked about that AI piece as we get into technology and cyber security. But another article that we talked about and covered here this week was an article From Digital Commerce 360 Grainger eyes more repeat customers@Zorro.com Tom I want to if you don't mind I want to move on through on that pretty quick because there's some some big stuff ahead of us. But the key piece of that takeaway for me was and I again that's Granger and Zorro has become kind of their endless aisles I think is one of the terms that they use with that as well is that you can put anything online for sale. Right. This just talks about some of Zorro's growth but the idea they're talking about a lot here is being really good at acquiring new customers but then getting them to repeat shop. So I'm going to flip flop this for the traditional typical distributor because the typical distributor and it doesn't matter if you distribute pool chemicals, hard hats or pipe valves and fittings, we're all really good at our field sales and branch counter sales and we do a pretty good job typically of repeat sales. But we miss typically two components. One is expanding wallet share which is one of the big tools that we do within Lead Smart Channel Cloud. Our technology tool that our company does is help get visualized what categories are we selling to our customer and which ones should we we miss that typically but then we're also doing very little online currently. So this article talks about all Grainger's doing online and I see this transitioning when looking at it from a smaller regional or independently owned wholesale distributor saying hey I work really well with my existing customers in getting them to buy more. Now I need to flip that over onto my website and even now cross sell do all of that that we talk about regularly about what we can do in that setting. So good article there. All right, where are we going next? Technology, cybersecurity and AI. Which leads us back to AI topic we talk about quite a bit here. Tom this article is about OpenAI CEO Sam Altman weighs in on Content authentication. And I think that ties a little bit to our previous article there about authentic content.

Well, it's, yeah, it's, it's, it's a little bit. Basically what you know, this issue is about is did you actually create the content?

Right.

Quote unquote, are you the, the copyright owner of whatever it is that you're talking about? And what he's talking about here in this article is that rather than using AI to spot non authenticated content, how do you use AI to actually basically tag and have certainty on who, where that content is coming from, whether that's through digital signatures? This is I think where the blockchain will really, really start to actually come, come to life.

Right.

Because the blockchain is all about using that types of things to have that basically that non something that can never be changed or go away. So it allows you to use the digital signatures. And it's in a way, he didn't get into that there, but I believe that's a big use of the, where the blockchain will fit in. But yeah, he's really, you know, and obviously it's an issue, right, Is that how do you tag, if you want to call it that or sign or whatever, that your content is actually authentic and be able to then let others know that versus, you know, content that's not, that's not authentic and generated through the AI process?

Well, there's just a couple of pieces that makes for that recap there. I think there's a couple of pieces that go with that as well, Tom, is they tie in this article and I think you've got a lot of this push from the current administration wanting to make sure that things are going to be safe and fair in the election. So we've got a lot about that. Is this real content from this candidate? Perhaps. But I think what's interesting in your comment about the blockchain tying to this as well is intriguing to me because I think what comes out of that additionally is the issue with brand integrity in general. Right. I mean manufacturers are working every day with the E commerce data that's out there about their products and who's selling their product on Amazon or ebay or reselling their products. And I think this kind of almost goes full circle in that setting is what kind of tools can we have here to authenticate managing my brand, not just a statement or a piece of content.

Yeah, yeah, I think, I mean the whole idea of blockchain is immutability which means that it's, it can't easily be changed or change or updated or. Or altered. So I think anyway we'll see but I think that's going to become a big part of it.

Good. Well I think that'll be interesting. We'll continue to watch that as we do here. So let's dive into our sales and M and A segment or let's say. I'm sorry we missed an article there about security. My apologies went too fast there. This is from Tech Target as well IBM studies show security for gen AI projects is an afterthought. Maybe a recap on that. Do you have any thoughts on that? And then I'll share a couple of quick ones.

No, I mean I think the byline here is pretty much tells the story right. 82% say trust is trustworthy is important and with AI but only 24% have done anything about it mainly because it's hard. Right. There's not an easy answer for this at this point so.

Well it's hard when you try if you don't understand even the importance of it, it's even harder.

Right.

I think there's an awareness factor of and I would look at this I think hadn't even thought of this as even in our organization is having you know some policies is what do. What tools are we allowed to use right. You know and I use that example, you know a couple of times in the past we've talked about this is you know I do a lot of volunteer work with faith based volunteer work and in my local congregation. You know I've got response some responsibilities about the safety of the facility and security measures and things like that and I had had two documents I had been given to review and I thought about asking ChatGPT to do the comparison and I stopped and thought it's like. And this was using free version of chat GPT3 I think it was. It's like wait a minute, I have the risk here if I load both of those in that I just put out to the world if someone else wanted to search if these documents were out there. So there's just all kinds of risks right that we want to. Want to be thinking about and avoiding and and I guess probably maybe the biggest takeaway and factor is becoming aware of the security issues that go with it and when you're aware of those then you can go do the heavy lifting to make sure you're.

And there's definitely some frameworks and other things that are starting to come out on this. So it, it, it'll get better or you'll get More relevant, you know, being able to do some of this. But yeah, it's not an area that's really been given a whole lot of attention relative to everything else. Great.

Hey two, two cool articles in our sales and M and A section here. The first one, which I really enjoyed was Brian Gardner's article. Brian and I just met recently and Brian is the founder of Sales Process360. He wrote a book called ROI from CRM and it's that finished its title there. Give him the plug he deserves here. The ROI from CRM. It's about sales process, not just technology. And he wrote a really good article about who is your CEO for CRM. This is available at the Distribution Strategy Group's website. He did this in conjunction with that team. I, I thought this was a really solid article.

Oh, it's a great article. And you know, we, there's a lot. I don't want to recap it. I think, you know, you're, you know, you're better served to take a look at the article and really talk about what it means to be a CEO of your CRM. But what it means is, is that, you know, somebody in the organization, right, has to be the steward of getting what can be gotten out of the CRM. What, what I find interesting and, and, and we see this every day, right? Let's face it, a lot of companies, we see it think CRM is a four letter word because of a lot of, you know, kind of the old school definition of CRM, right, which is Big Brother and all we're going to do is add extra work and blah, blah, blah. But I look at the value that I see our customers getting into sort of this next generation of CRM and the sales growth that they're getting and the value and the enablement that's occurring with their sales team and the insights that's there, right, is so massive that this idea of the steward of the CRM, almost like you could have a chief CRM officer in the organization. And I know that's not the best word, but it's really, there's so much value to be gained out of it. You know, we do a lot from the vendor perspective, but within the organization, having somebody that can continue to facilitate that value is really, really a, I think something we're going to see more and more of as CRM. As people start to understand this next generation of CRM is not the generation of CRM of Big Brother and extra work and whatever, whatever they call it, CRM Saturdays or whatever. It was so that people were entering those. And unfortunately, I wish there was a better term for it. Right. I wish there was a new term, but there's not. But anyway, the point is, is in this article is how do you actually get the mileage out of it? And I thought it was some really.

Really good advice that CRM Saturdays we got a. I, I've said it a number of times. I heard that from Joyce Lansdale, from, from Valen is who shared that that that's not what she wanted her team doing, but had been exposed to that in the past. But I think, I think you're right. So a couple of statistics out of this. Brian talks here about 80% through a survey of business leaders were unsatisfied with the performance of their CRM system. Right. And we see and hear that all the time from companies who have had a tool in the past. And so much of it is because one, how they viewed it. Right. And it was Big Brother versus being a tool where you could truly show your employees that, you know, what is that old term? The world's favorite radio station is wiifm. What's in it for me? And right. Not showing that. And it's a Big Brother tool and so forth. So I think that's where a lot of that comes from. And then poor onboarding, which we know is critical. Right. And when you're doing CRM, right. And you're giving more data to the salespeople, and not just salespeople, but to your organization, then you're asking in return, you're going to have a great onboarding and a great adoption experience. This was talking about another research study that had been done that talked about effective onboarding will increase retention by 82%. Bamboohr says if you have a good program, training programs, employees are 18 times more committed to your company as well. So, man, that's a lot, a lot of data there that can help.

Well, and the one thing that I think the article did miss is talking. They didn't really talk about the functionality or capability of CRM in today's world. Today's world of CRM, speaking from our perspective, is all about driving sales and driving growth and driving a better customer experience. It has very little to do with tracking activity or being Big Brother. Right. So no matter what you do, if you're trying to onboard an organization around, hey, you need to track activity. And I'm. We're going to monitor that. That's a hard road. Yeah. But if you're onboarding an organization based around, hey, you're going to put more money in your pocket, you're going to have happier customers, you're going to grow the business, you're going to whatever the case, you know, drive sales. That's a very different story in a very different onboarding, quote unquote approach because the adoption will go there. I think inherently he was implying some of that, but it just didn't call it out exactly. In the article.

Yeah, no, that's good. And if you're interested in these types of things, reach out and follow Brian on LinkedIn as well. There are though before we go on, Tom, there are a couple of bullet points that were worth talking about that he mentioned here as he talks about a CEO for CRM. Call it whatever you want, call it a project leader, call it whatever it might be within your organization. But the idea behind that is and he has a list of eight or nine of these I think. But one of the most important things is that somebody believes in the value of a properly implemented platform. Right. It's getting that buy in by the person that's leading the project that's not just been assigned something, but they see it and they understand it. Right. They talk about being somebody respected in the organization with the power to make changes within an organization. I think that's great. Then he talks about understanding how sales, product specialists, marketing service department management and so forth all coexist using the technology. Right. Skipping over a few of them says has the bandwidth to spend the time needed for success. I hear this from you and your team all the time of implementing with our customers is we could add them done three months earlier if they would have blocked the time and laid things out correctly. Right. Is it savvy but does not have to be an expert and then understands clearly about how the CRM platform will work with other information systems. So good article. We should probably get Brian on the show one of these days and have some further discussions. But I enjoy that one a lot. So moving on. We covered an article in here. We're in our our sales and M and A segment but we covered an article a few weeks ago about Home Depot's acquisition of SRS Co. And this article is also from the Distribution Strategy Group. There's quite a few comments in here from Ian Heller. It's written by a gentleman by the name of Don Davis. I thought this was a really insightful article. If you're in the wholesale distribution space about the depth and what's going on with this this acquisition that we saw. So SRS Distribution Texas based company mostly roofing Entered into landscape and pool supplies and so forth a number of years ago. They've done 107 acquisitions within their organization at SRS, about 10 billion in revenues, 750 branches and warehouses in 47 states, 2,500 sales reps and 4,000 trucks. And home Depot bought them. You think there might be an issue or a potential threat there? I think there is a risk of that. And this article I think does a really nice job of giving a view over Walmart, Amazon, Lowe's and Home Depot are the key ones that it mentions in here. I thought it was really valuable. And it quotes, the article quotes Ian Heller, who's a good friend of our shows and a good friend personally as well. And he made the comment, he says contrary to analysts assumption, all of these retail based companies can earn higher margins in certain sectors of distribution. They can than they can in the retail markets. But the other issue that they face is if they want to grow and move into other segments, into their own industry, specifically retail, they've got a huge risk because of how aggressive the current Federal Trade Commission is. And Ian quotes here about, you know that Lina Khan, who we've talked about, I don't know, five, six times over the past year of what she's doing at the FTC to block big deals. So if you're a retailer and you want to expand in retail, you've got to fight a tight and rigid FTC right now. Why wouldn't you take the deep pockets that you have and go into new markets and new segments where you could be successful?

Yeah, no, it gives them an opportunity to be under the radar, do under the radar acquisitions of, you know, quote unquote. Not that these are small businesses, but they're not mega businesses and they're just, they're going to pass through the process. So you know, you see that even in the tech tech industry right now is that more and more M and A actions are under the radar, not these big mega mergers. Right. And that's what they're saying here. And I agree also that there's a lot of, there's a lot. You know, they said there's a lot of money to be made in this space and these big public companies have to keep showing earnings growth. They have to keep showing growth. Right. So yeah, there's a lot of incentive for them to do some of this. And I'm sure a lot of eyes are on this acquisition, the SRS one from these other players to see how it goes. And if it goes well, then it will be probably accelerating.

Well, and you're right, spot on. Right. And a lot of this was tied to the cash that these companies have and access to cash. They have the resources, they have the teams, they have the people. So when you look at Lowe's, Walmart, you know, Walmart in 2022 instituted their Walmart business which was just a response to Amazon business. But we talk all the time about the growth of Amazon business. It's pretty astounding, you know, of what can be here. So it's something that we'll continue to watch. I thought this was a very well written article. Two great articles that we focused on today from Distribution Strategy Group and some of the writers that they work. So good stuff. You know, we have a People in Leadership segment each week that we go to as well. There's two articles there. Oh yeah, before we finish with that in our sales and M and A, there's an article there about Affiliated Distributors, one of our great partners that we work closely with as a preferred service provider from Lead Smart, they hit record sales in the first three months of 24 of 19 and a half billion dollars, almost $20 billion for sales across their members. So exciting. That's a 7% increase over their 14 divisions that are in three different countries. So it's good news. But as we jump into kind of winding down today in sales and leadership, there's an article here that from CNBC talks about job growth less than expected and a little bit of a rise in unemployment. And then there's a cool article there from manufacturingdive.com and it talks about a second chance. Hiring can bridge manufacturing labor costs. And it's interesting because within that article it talks about hiring former former inmates or former prison people with prison records and so forth and helping them to get into having programs to help them get back into the job force. And when we talk to wholesale distributors and manufacturers every day, one of their biggest challenges is, you know, employee retention and finding people. And maybe there's a balancing act that can go through some of these programs that reduce recidivism, you know, or people committing additional crimes by having a life changing impact. So kind of a cool article. Feel good, feel good article there.

Yeah, it's an interesting one. That'd be an interesting one to get a take from Dirk Beverage on. I, I don't know. It'll be interesting to see the pros and cons of that and what are the risks of that and so forth. But if it can work then it could be a way to fill that gap. A bit that is obviously quite substantial.

Very good. All right, well kind of winding out of the out of this today. Each week we have a segment called Industry Scuttlebutt that's in the newsletter. Again, we're here live. If you're not with us, if you're listening to the podcast later in the day and not with us live, we're looking at a newsletter that we publish each week called around the Horn and Wholesale Distribution. If you'd like to get that, just reach out to us. But talks about a great acquisition that Rexell just did by acquiring Talley. Good article there about the follow up that that's from TED magazine, the electrical distributor magazine. You can catch that one there. Blackhawk Industrial acquired a factory tooling outlet in Texas. Blackhawk is pretty consistent in their acquisitions. But the last thing we'll mention on this arena today in the industry scuttle but is that the Industrial Supply association isa, I was at their event in Charlotte last month and got another event coming this fall and they've had a tool called their Top Line Pulse, which is a modeling and data analyst and analyst and forecasting tool. They relaunched it. If you're in wholesale distributor, you're a wholesale distributor. Go take a look at its isapartners.org and go look at the Industrial Supply Associations tools. Really kind of a cool tool that they launched and talked about Brendan Breen and his teams teams growing. They're doing some really neat stuff to reinvent isa. So it's I guess this would be this is not your father's ISA anymore. So that's kind of it for us for our articles and so forth. We had our Goodreads there. You can check in that on our newsletter as well. But any closing thoughts on our articles or the week? Tom?

No, there was a lot of that was quite a wide variety today.

We covered a lot of ground, didn't we?

Yeah, a lot of ground. And thanks for the comments and for the things and yeah, we have some good guests coming up I think over the next few weeks. So you're not going to just have to put up with you and I.

No, we've got what I'm pretty excited about is we have the CEO of the national association of Wholesalers on at the end of the month and quite a few other guests lined up. We've got Jonathan Bine coming on shortly from Distribution Strategy Group as well. We'll spend some time talking about Distribution Strategy Group's big AI conference that they have coming up in June as well. So a lot of Good stuff. And we have, I think between now and the end of June, I think we have four or five great guests coming and then we're starting to stack up our guests for the rest of the year as well. So if you have suggestions about what maybe we should be talking about each week outside of what we already do, suggestions for a great guest, we would love to hear about that. The other side of it is if you have any suggestions about how we do this or how we can make this better. We do this for wholesale distributors and manufacturers and the hard working millions of people that are involved in that marketplace. So keep us posted if you see anything there. So tomorrow, anything exciting for the weekend planned?

Nothing too exciting? No, no, no.

Okay, good. We'll stay at your desk, write some code, learn, learn more about AI and and go from there. So, Kevin Brown, Tom Burton, thanks to our our sponsors at Lead Smart Technologies, the company that Tom and I both work for. We will wish you all a great weekend. Enjoy some time with your mothers if that's what you have planned, and we'll ask you to be kind, be safe and do good things. Thanks for being with us.

Thanks everyone.

We hope you enjoyed today's episode and our guests. Each week we try our best to dig into the 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 wholesale distribution get access to the conversation. And finally, please check out our sponsor 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.

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