Why B2B Buyers Want Sales Reps, Just Not All the Time

Foreign 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 and 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.

Happy 150.

Happy 150.

Here we are. Who to thunk.

You have your 100th shirt on.

I have my 100th anniversary shirt that we did for the panels, that panel of folks we had and I've just talked to a number of people who've been on the road this week and talking about having this 150th show and they're like, what are you doing and what's, what's the big, you know, shirts or what Hats or what's the and no, just three out of the last four weeks on the road and I didn't get quite get to anything but I did figure out a way to get a great guest with us for our 100.

That's right.

So while there haven't been shirts and swag sent out, there is in fact a great guest too. So, Mark, how are you, my friend?

I'm amazing. Delighted to be here. I didn't even realize when you invited me that it was the 150th, so I didn't.

I didn't either.

I think Mark is going to bring some real class to this.

That's right. Just his accent in itself just raises the show up a level.

I feel like I need to sit up a little bit more.

I did put my suit on to, you know, to dress up and I thought you were going to do the same, Kevin. But it turns out this is the, the special. This is shirt.

You know, aloha shirts are me dressing up. So I'm, but you know, it's what's, it's funny. I will I'll just say this right. I'm in my home office and when you arrived with your handsome blazer on there this morning, I think, well, you know, I'm just a couple feet away from my tuxedo. I could go throw that on. But that's what I should have done this morning is rolled in with a tuxedo one a tuxedo from the waist up.

Nobody wants to see you change now, so let's move ahead.

No. Okay. Well, great. Well, listen, Tom, congratulations to you and Mark thanks you for being with us. And you know, who would, who would have thought, what are we, you know, approaching three years to go, that we this would turn into what it has. So what a, what a great opportunity. But I was just kind of trying to find the right word of where we've come, right? This started out as a me sending Tom a note. I was talking to a few people this week. Tom and I were at the Affiliated Distributors Functional Success Summit in Florida for a few days and talking to a few people about this. And you know, this whole thing started out as me going to Tom and say, gosh, you know, I get all these emails every week and review all of this info about the economy and supply chain and M and A and all this stuff and industry events and maybe we should do our own newsletter and get it out to these big lists of people because who wants to get, just constantly get, you know, emails from technology companies that say, hey, buy my stuff, so why not send something out that has some value? And so Tom was smart enough to say, I almost called him wise, but let's just say smart was smart enough to say that. Why don't we try this LinkedIn live thing? And here we are, 150 episodes later and now our typical show is probably 30 states in the US we have people from three or four provinces across Canada and usually five to seven other countries besides the US and mailing list is up to 10,000 plus people now. So it's kind of exciting time. So anyways, before we dive in, I'll just add a little bit to that. So again, if you're with us for the first time, we'd love to hear from you. If you happen to be on LinkedIn Live, YouTube Live or Facebook Live, you have the opportunity to comment. I am again, I'm Kevin Brown. I'm here with my co founder and lifelong friend. Tom and I work together at Lead Smart Technologies. And we have our good friend Mark Gilham here that's joining us from a wonderful company called Enable that we're going to talk about in a few minutes. But we do this every Friday as we've Talked about Live, YouTube, Facebook and LinkedIn. And then later in the day, our editor and producer, John Taylor takes all this data together, puts it into all the right formats and gets it out to the Apple podcast, the Spotify and all of the other podcast formats out there as well. So it's a great opportunity that we have each week to get together. We're happy if you're here with us. The one thing that you could do for us that would be really beneficial. As we talk each week about again M and a supply chain, the economy, tariffs, sales, marketing, people on the move in the distribution industry would be Share this with your friends. If you're on LinkedIn, maybe share a comment that you're joining us today. If you, if you're and certainly if you're on LinkedIn, just go follow the show on the around the Horn and wholesale Distribution and manufacturing podcast, there's a page for that also. If you could follow us at Lead Smart Technologies that would be great. Then you will also get to show updates from that. And then finally if you're on YouTube, just hit the subscribe button and you'll get alerts each time and that'll help YouTube's algorithm to get out to more people. And then of course if you're listening on Apple or Spotify or any of those platforms, please leave a review which is a great help to us to get this out in front of a lot more people. So we couldn't do this each week. Our little closing part here is if we didn't have the sponsorship, we've got two people that work on this show besides Tom and I and our guests Lillian and John. And so quite a few costs that go with that. So we have the fortunate opportunity that the company that Tom and I work for sponsors the show each week. Tom and I work for Lead Smart Technologies. And at Lead Smart we've developed what we describe as an AI enabled smart CRM and customer intelligence platform that is developed solely for wholesale distributors and manufacturers. What we do with that platform is we bring siloed data from across an organization. Your ERP data, marketing automation, e commerce, rebate data, all kinds of different data that you might have across your organization. We bring that into our platform. We use artificial intelligence and other tools to run against that to help you make smarter business decisions, serve your customers better, improve customer experience and gain deeper insights not only into your customers but into your teams and your entire business. So it's a cost effective program, implements very quickly and returns phenomenal return on investment quick. So if you're digitally transforming, looking for ways to expand and serve your customers better and grow your business organically, this is the right tool for you. We would love nothing more than to talk with you about that. So diving in today's show, our friend Marty McLaughlin here says nice shirt, Kevin. Marty says that because he has one. Marty was with us as one of our panel guests for our hundredth Marty.

Are you wearing your shirt? I Wonder if he's got his shirt on.

We did. Marty is tall and thin, so Marty's might have needed to go to the tailor, but I hope it did when I'm near Philadelphia next. I lost him. I was there, I had dinner with Marty and I will be expecting him to wear that shirt when I take him to dinner next. So, Mark, I've talked a lot. Let's hear a little bit about you and Enable and then we will dive into the news. Sure.

Well, to start with, my background is distribution, building materials. So very familiar subjects and what you just mentioned, I still remember the Eureka moments when we actually started to use data as a distributor. And what we realized was we could make our customers happier and we could make more profit at the same time. And it was, yeah, it was genuinely eureka moments when we realized when we were able to actually get a grip on that data. So I think what you guys are doing is, you know, so powerful and every distributor, manufacturers as well, the whole kind of supply chains, they need this type of technology, Enable. So what we do. So I'm a former client of Enables, so that's how I ended up working for them. They solved our rebate problem. So for us that was collecting rebates from our vendors or our suppliers and again, that was a game changer. There was money we were leaving on the table with a platform like Enable. We were able to find it, but then we were able to foster back better relationships with our suppliers because we had one version of the truth, one place where we had an agreement, one set of data, managing our relationship, that kind of thing. And what I do now is less about the software, more about just helping businesses do these things. Well, explaining to businesses what a good rebate looks like versus what a bad one looks like. How do you create win win scenarios, that kind of thing. So I've been diligently listening to this show because I really, I really like it. When I was in the uk, it was, you know, it was perfect. You, you used to joke five o' clock in the evening on a Friday, you know, I'd have this on as I was wrapping up my emails for the week and just learn what's going on in the world. A lot of your guests, you know, people I know and yeah, yep. So I, I, I thoroughly enjoyed it. Whereas now it's, now it's a lunchtime session. So.

So you, what you're saying is you're not a North Carolina native?

Unfortunately, no, no. Albeit, you know, the people here, you know, they're so friendly, you Know, people talked to me about Southern hospitality, and I wasn't quite sure what it really meant, but, I mean, you just go to, like, a local Lowe's just to get something. You end up having a conversation with somebody, even if it's the Lowe's employee. Everybody's so nice. So, yeah, I've really been welcomed with open arms into the United States. So, yeah, thrilled to be here.

That's awesome. Great to have you with us. And I think some of the work that you do with distributors and what Enable does as a whole will really tie in well to some of the things that we're going to talk about today. So, Tom, you want to get us started and dive in, or do you want to give us a little bit of your background in history?

My background in history.

Hey, Mark. I will say, though, before we dive in, you know, with you saying that, you know, when you're still in the UK, which was just, what, 45 or 60 days ago, was that in my mind, when you were just saying that you were wrapping up your day and taking care of emails and so forth, I just have to tell you, in my mind, when you were listening in or commenting on the show, you were sitting in an overstuffed leather chair with a smoking jacket on and slippers and a gin and tonic. This is very British. End of the day, you know, so you really kind of burst my whole vision of how you were watching the show previously.

Yeah, I'm sorry, but believe it or not, I mean, you guys know Dirt.

Beverage, of course, Dirt Dirk has one of these shirts.

So I. Without even realizing, you know, I'm not sure if you were. Dirk stopped drinking. I stopped drinking on the exact same day and didn't even talk to him about it. And then we realized. So every now and then I get a text from him saying, so many days, buddy. How's. How's it going? Yeah, it just. So, unfortunately, yes, the. No gin and tonic, but, yeah, it was. I thoroughly enjoyed sitting in and listening, so. Can't wait to get into these bits with you guys.

Yeah, well, now. Now it will be lunchtime for you instead of end of the day. Yes, very good, very good. All right, Tom, do you want to take us away and get us started?

Well, we have a little economy again. First article here. June wholesale prices go and change, reflecting mutif tariff impact. Then there's a second article here that I'll just kind of talk about. The first two tariff impacts show up in economic data as companies respond. So what I read from both of these, right Is at a macro level, not really too much going on related to the tariff impact as far as inflation and costs and so forth. But at a more regional or local level, it sounds like there is definitely some, you know, obviously impacts depending upon where you. So if you drill down into it, yes, there's certainly pockets of impacts that are taking place and kind of those are what the. I thought was good. Those two articles kind of showed both sides of the story, if you will, for more of the local side of things.

Yep. Mark, any takeaways on those?

Yeah, I think, you know, June and July have been kind of interesting months because I feel that we had the. We're still in the uncertainty, but I feel like a lot of things changed in March and April and then things really haven't changed. We've kind of been in a holding pattern waiting to see are these reciprocal tariffs going to come into effect, that kind of thing. One of the things that I found really interesting was I looked before coming on here website Freight Waves, which talks about the teu and what we're seeing is right now they're marginally up year on year. Next week they're going to be down 11 and a half percent and the week after that they're going to be down 22% year on year. So it feels as if we've. We've had a kind of a bit of a burst of activity on the back of things being put on hold and then we're going to, we're going to see a slowdown again. So when we talk about prices going up but demand being suppressed because of that supply and demand kind of dynamic, they're almost offsetting each other a little bit, which makes me feel that the manufacturers must be absorbing quite a bit at the moment.

Yeah, I think that's a good point. I think just trying to remember who we headed as a guest that did not agree with me on this comment at all. I wish I could remember just another take. My view has been, and I'm going to share some statistics in a moment about, you know, what's going on with tariffs as far as what's been collected. But my mind had been, let's just say there's a 30%, you know, tariff on a, on a Chinese product is probably the easiest way to look at it. Right. They're going to take 6 to 10 on their end and put some other programs together, come back and, you know, ask you to buy more of a, you know, this is all, there's all the negotiations we think about what the administration is doing from a negotiation. Every distributor now and manufacturer themselves who are getting raw materials and distributors who are getting stuff from China or offshore now or having to have their own level of discussions. But if you think about it, let's just say you're an electronics manufacturer in China, you're going to have a discussion with a distributor that says, hey, you know what, on these critical components that you buy from me, there's a 30% tariff. Whatever the number ends up being, we'll take 9.2%. But to do that for you, I need you to buy more of this other item as well. Because now and then if you buy a certain level of that, I'll take that 9.2% to 11.5.

Right.

And there's those balancing acts. Mark, you're shaking your head like you've seen this happen before. It's just day to day stuff, right? We want you to buy more of something that we have better margin on. They'll find that balance. The distributor then will, in that setting probably go and take 5 to 7% maybe themselves potentially and. Or they may just pass that all the way across. But between the factories and I think maybe some. And it just depends on the distributor and or manufacturer's philosophy, but I think there are some that will work with key customers. Again, negotiating with them and saying this is what I'm facing. And the indirect impact could be in many instances it could be offset by as much as in 20%. So I just think each one of these situations is going to be different. What I would be surprised of is if across the board you were to see a distributor H Vac, maybe industrial market that says, hey, we're raising our prices 30% across the board on everything coming from China. Because that's what the I'll just say uninformed or less strategic distributor is going to do. The strategic distributor is using lots of technology to analyze their inventory. And last in, first out, first in, last out, all the different models that they can do to balance their pricing best and then they're negotiating with their factories.

Hey, Mark, would you also see that. Are you seeing this? Is that rebates are kind of playing into that overall holistic strategy as it relates to pricing and maybe adjustment of pricing or maybe having more flexibility on or less, I guess, less change on the pricing side, but using rebates to be a bit more dynamic and how they're adjusting with things.

Yeah, we are seeing a couple of changes and you're absolutely right. The last thing you want to be doing is changing your prices too frequently. It's a real challenge whether it's the end consumer. They like price certainty. But just the admin involved, you know, is huge in these things. So what you can do with a rebate is you can keep your pricing nice and clean. You can use a rebate behind the scenes to make retrospective adjustments. And that could be I mean, Kevin, you mentioned, you know, planning for inventory and things like that. Inventory is king right Now. If you've got the inventory and a tariff comes in, well, you change your price. And then you say to your customer, okay, I'm going to sell it to you at the new price, but I'll rebate back to you if you do xyz.

Right.

Because I've got the inventory to do that for. So it's a great way of driving sort of.