More than two-thirds of make, move, sell businesses changed their business models in 2021 in reaction to the difficult supply chain climate, and 85% of them experienced growth.
- In order to compete better, 78% of the businesses questioned modified their key business competencies over the past year.
- 85% concur that expanding their product offerings has helped them grow.
- Direct-to-customer sales and delivery (47%) as well as e-commerce (40%) and configure-price-quote (39%), are the main strategies added for growth.
A change in tactics
It’s a prevalent misconception that industrial organizations lack the digital skills of their B2C counterparts despite the fact that their clients still have the same expectations. However, the most recent results from Epicor’s Annual Insights Survey thoroughly dispel this myth and show that companies of all sizes are competing in novel ways, and the good news is that it’s succeeding.
Industries have been flipped upside down by the seismic developments of the last two years, and companies of all sizes are implementing novel supply chains, entering previously inaccessible markets, and engaging in new forms of competition. This wave of change is bringing a renewed sense of self-assurance and a focus on corporate expansion. Growth is prioritized by 56% of poll respondents overall, while distributors and retailers have the best prospects (63% and 59%, respectively).
The pandemic had a significant impact on recent large company evolution, and SMBs stepped up to the plate as well. A startling three-quarter (78%) of those surveyed, exclusively from the manufacturing, distribution, building supply, automotive, and retail industries, shared that they had altered their core business models over the previous year in order to be more competitive. 44% said they had incorporated new tactics:
- Direct sales and delivery to customers (47%)
- Online ordering for e-commerce (40%)
- Solutions using Configure-Price-Quote (39%)
However, the story of disruption is not just about what they added; it also includes the rationalization and streamlining of business initiatives. In fact, 34% of respondents said that they evaluated their strategy and scaled back on some of its elements. All of this transformation led to 85% boasting that they witnessed growth through broadening their product offers.
‘Distro-fracturing is becoming more popular
Customers have a desire for all three in-person, remote, and online channels when given the option. The poll found that more than half of distributors (56%) had started offering direct-to-customer sales, indicating the creation of a new class of hybrid companies known as “distro-factors.”
Digital transformation has, of course, been touted as being essential for service diversification. According to 86%, they modified their technology to take into account their increased capabilities. Particularly, 84% of companies chose to diversify to e-commerce, and 85% preferred to diversify their supply chain. As a result, the majority (54%) feel sure that their company is headed in the correct direction, and nearly all respondents (95%) think the use of the appropriate technology will speed up growth. The report’s findings support this claim: while 95% of respondents said that the right technology will accelerate growth, 92% said that they prefer to work with vendors who have “specialist industry knowledge.” This means that technology solution providers must be prepared to adapt to these growing needs and provide businesses with solutions that are specifically designed to meet them.
The results of the poll demonstrate that firms do not plan to remain stationary. Midsize businesses that want to compete are constantly reviewing their business plans, changing them to increase their product and service offerings, and relying on highly adaptable cloud-based technology to boost performance and agility. While it may be tempting to move quickly out of a sense of not wanting to fall behind, meticulous planning, the right integration partner, and a strong implementation strategy will win out.
1,350 IT decision-makers in the U.S., U.K., Australia, and New Zealand who work only in the manufacturing, distribution, construction supply, automotive, and retail sectors participated in a PSB online poll. English-language interviews took place from April 1 to April 22, 2022. For the entire sample, the margin of error is +/-2.76 ppts, and it is higher for subgroups.