The future of distribution, manufacturing, and impact on products and end users is unknown, but many in the industry have voiced concerns over large players possibly removing the middleman of the distributor. Hose + Coupling World had the privilege of understanding this topic from the perspective of a distributor, manufacturer, and one who has experienced both sides. Jess Wiley, Regional Manager at Applied Industrial Technologies, provides his insight as an active hose distributor.
By Sara Mathov and Angelica Pajkovic
Distribution and Supply Chain
Jess Wiley has been working in the hose industry with Applied Industrial Technologies for over eight years. For the last two years, he has held his current role as Regional Manager for the Central States Area Rubber Shops. “We are the largest fluid power distributor in North America, and we have a lot to offer our customers,” said Wiley. “We try to bring the entire package to our clients by offering services that range from hoses and conveyor belt to mechanical shop services. My group specifically focuses on industrial rubber products across many industries and applications, including working with Applied’s automation platforms.”
Throughout the pandemic, Wiley witnessed several shifts in the market. One of the most prevalent shifts he experienced was in individuals’ eagerness to learn. “With the availability of virtual meetings and online courses, many are taking the opportunity to acquire more knowledge. People are learning virtually how to identify, assess, and address problems on their own, so we have had to adapt,” said Wiley. This transition has led distributors, such as Wiley, to respond by acquiring more knowhow and knowledge themselves, in order to truly be an expert on the hoses and applications they are working with.
An issue that has risen since the beginning of the pandemic has been the delay of shipments and lack of product availability. “There has been so much disruption in the past few months at plants, and in the market in general, that the role of the distributor has become much more comprehensive. We are doing everything we can to ensure the clients have what they need,” expressed Wiley. “The pandemic certainly reminded us how essential we are throughout the marketplace, and I think any hose distributor would agree that we were part of the infrastructure that needed to be up and running. Keeping our associates safe and healthy, while servicing customers, was and still is a huge priority.”
So far, Wiley indicated that he has not experienced too many challenges with the supply chain at his company. “Some expect more to come, but being a large distributor, we have a lot of sources. Additionally, our supplier partners have done a great job of staying in the game. There is uncertainty to come, and possible shortages for product lines, but so far so good.”
Setting Distributors Apart
One of the advantages a hose distributor has is close relationships with its customers and suppliers. “We have key suppliers that we have worked with for many years, so we as distributors understand the whole market. We constantly look for new relationships and know what is available and out there.”
When looking at virtual competitors, like Amazon, Wiley said having similar products can make things challenging, but there are always ways that distributors can differentiate themselves. “Our goal is to always find ways that we can make a difference, and this is not just transaction cost. It must be something unique. We are always trying to find the pain point and translate that among multiple customers.”
Although distributors are aware of the qualities that companies, like Amazon, possess, Wiley believes that the services he and others offer, truly differentiates them in terms of quality and reliability. “Our focus is trying to establish a greater digital presence, and make sure that we at least have a platform that is appealing to those that are appeased by Amazon, and the ease of ordering. We hope we bring that into the market in a way that is more beneficial than someone going strictly online.”
Wiley does not believe that any distributor will be fully online and automated like an Amazon platform would, but stresses that any distributor should strive to make the process as easy as possible. “We have the advantage of having information from the end user about how they are using our products, and how that leads to the need for other products,” stated Wiley. The biggest difference between distributors and artificial intelligence is people in the field; it is imperative to have someone who can solve problems or provide visual inspection. “There will always be value to having technical experts on hand,” he continued.
The other benefit of using a distributor that cannot be overlooked is their ability to learn and adapt to each customers needs. Unlike the spot purchase processes that takes place with artificial ordering, distributors have a relationship with their customers. “We spend a significant amount of time with both the products we are distributing as well as the individuals that use them. As such, we have data that helps us understand the parts, failures, and more, which makes us a more effective and efficient source. I think we could even get to the point where we forecast inventories based on the current condition of the equipment.”
Wiley is interested to see how the future hose technology evolves. “One of the most prevalent technologies I have seen is condition monitoring, along with a number of tools that monitor hoses and connections. I am very interested to see how this will help predict the need for inventory or replacement. While this technology is frequently seen with electric motors, bearings, gearboxes, and more, it will be interesting how it translates in the hose industry.”
As the industry adapts, Wiley predicts a shift to IIoT tools and a focus on emerging industries like renewables. “Wind energy is a large area for hose applications, primarily in gear box cooling, and I feel like it is just a matter of time before all applications have some form of IIoT to help mitigate risk. In both of these scenarios I believe that distributors will remain an essential go-between for the manufacturer and the end user.”