Distributors Work With Suppliers, Customers To Manage Supply Chain Challenges
The global supply chain and its struggles are affecting almost every business and industry in the U.S. and abroad. Computer chip shortages, a lack of truck drivers and congested ports are driving up prices, slowing down deliveries and sowing uncertainty. The promotional products industry hasn’t escaped the supply chain troubles, and companies in the sector are taking steps to manage its impact on their operations, and what they communicate with customers and vendors.
In speaking to industry distributors, PPB Newslink has noted similar stories about products being unavailable or slow to arrive and order errors, as well as communication challenges that exacerbate the issues.
“Inventory, backorders, delays in transit, shipping carrier mistakes; these are all happening across the board,” says Kara Keister, MAS, co-owner of Sandusky, Ohio, distributor Social Good Promotions. “While not ideal, these are typically manageable, at least to some extent. The problems that are more directly affecting our small business right now within the supply chain are lack of transparency, poor or delayed communication, lack of clear or consistent process and resistance to change. These are the hiccups that are costing us significant time and money.”
Kim Bakalyar, CAS, chief compliance officer and director of vendor relations at Los Angeles, California-based distributor PromoShop, has had a similar experience. “The biggest issues we are seeing are shortage of inventory, delayed shipments and a high number of errors on orders,” she says. “As suppliers are getting busier, mistakes are happening, the wrong product is shipped, inventory is misplaced and we are not made aware until it’s too late. All of this impacts our sales, internal staff and end users as we need to find solutions, and every order is different. What used to take two-to-three forms of communication is now taking six-to-eight touches. We remain optimistic and thankful to our suppliers for doing as much as they can.”
These problems are having a material effect on industry businesses. Robert Fiveash, co-owner of Morrisville, North Carolina, distributor Brand Fuel, says, “The supply chain and inventory issues are significant. We lost a $100,000 hat order for a key client because the goods were not available, and alternatives were also out of stock.”
The distributors PPB Newslink spoke with all mentioned that managing the situation has meant increased and more involved contact with suppliers.
“We are in constant communication with our suppliers, trying to keep abreast of their current inventory and where they are with production and customer service staffing,” says Bakalyar. “We also want to know what we can do better to streamline the process and make it easier for all during these difficult times. Communicating these challenges to our customers has also become a priority.”
Fiveash adds, “Our coordinators and salespeople are much more involved behind the scenes with orders these days. A lot more supplier follow-up is required today, and our folks are working three times as hard just to maintain the business. Suppliers don’t have the staff or time to be as proactive as they’d like to be with us, so it is falling on distributors to pick up the ball and help share the load with our supplier partners right now.”
More engaged partnerships, and an understanding of what everyone is going through, can make navigating the supplier chain crunch easier on everyone. Keister says, “We have attempted to stay abreast of the ever-changing situation. We read, we listen, we watch and try to keep our pulse on what is going on. It’s important to remember that suppliers and distributors alike are all in the same—seems like sinking—boat right now. We are all human and we are all trying to do the best we can, so it’s time to exercise some patience and compassion, even when your order has derailed.”
She recommends creating partnerships that are based on trust and transparency, and having an open dialog with suppliers and using that information to steer clients toward products that are available and will meet their expectations accordingly. She also advises providing constructive criticism when appropriate, saying that these steps will help everyone be a little less stressed in the long run.
Dealing with the challenges posed by the supply chain means making some changes at home, as well. Distributors say they are tweaking their processes and rethinking their procedures to better accommodate the situation.
“We are doing our best to adapt as quickly as possible and keep up with the ever-changing environment,” says Keister. “Our team has always been consultative in nature, but it’s more important now than ever. Catalog shopping is no longer a thing. We explain to clients from the onset the challenges the industry is facing and help them select product based on need, understanding that the SKU may change, but the overall end use will be consistent. As long as we have a mutual understanding from the gate, it seems to be a smoother process from order to delivery. We also have increased our communication with our trusted supplier reps. The more we know, the better equipped we are to service our clients.”
Brand Fuel has expanded its staff to help it manage supply chain issues. Fiveash says, “We have had to staff up our sales coordinator positions since the existing coordinators and salespeople are spending so much time on order follow-up and finding alternatives when inventory is out of stock.”
Bakalyar says, “As we are getting busier, which is a great problem to have, everyone is working at warp speed and mistakes happen. We have added more staff and we are hiring. Also, we are asking everyone to slow down, take a breath, triple-check inventory, have a plan B just in case, and make sure that all i’s are dotted and t’s are crossed before an order is sent in. It should be clean and ready to go.”
Supply chain stresses have also prompted new conversations with customers and steps to keep them informed of the situation.
“We are being very transparent and honest with our clients,” says Bakalyar. “Educating them on what is happening in the world. Every article our account executives send their clients is another opportunity to increase sales, get orders in early and manage customers’ expectations so there are no surprises.”
Keister adds, “We are telling them exactly what is going on, how it is affecting our industry, how it has affected our business, and most importantly, how to navigate the situation to achieve their marketing goals. Our team has had to implement the ‘No, but…’ conversation in almost every transaction. No, we can’t get that by Friday. But, we can use an alternate product, create a temporary solution, deliver to home, etc. It’s also been an amazing time to really get to know our customers and what their end goals are. We have more true marketing- and use-related conversations now than ever because we can’t always stop when the item is selected.”
Educating clients on the situation and how it might impact their orders is an ongoing process and takes many forms. For example, Fiveash says his sales team has added this message to their email signatures: Please PLAN AHEAD. Our industry is experiencing unprecedented inventory and production challenges, and lead times that were five-to-seven business days have been extended to two-to-four weeks or more. Inventory cannot be reserved or guaranteed until the order has been submitted and proofing is complete. READ MORE. Thank you for your understanding.”
He adds, “We have been educating clients on these topics for at least six months, starting with newsletter reminders and our updated blog post. As long as we set expectations in advance, clients are usually very understanding.”
Fiveash also advised not to assume clients understand these issues and/or are aware of the news. “Because this is such a competitive industry and many will do anything to get an order, we have anesthetized the client to bad news when they never hear ‘no.’ And while that’s a bad thing for the industry, clients are remarkably understanding if you just educate them early and try to offer a solution. So, reach out now, it’s not too late. This problem is not going away soon,” he says.
Bakalyar agrees that honesty and transparency are key to managing expectations. “If you think the order might go sideways, do something about it! Be proactive and stay ahead of the issues,” she says.
Keister adds, “Hang in there, be real with your clients and take a serious look at your processes. Disruption leads to evolution. Things are not going back to the way they used to be, so it’s time to make waves and be excellent.”