Traditional 3 Tier Model
The traditional Mfg. through Channel to Customer linear model with two distinct Buy Sides (Channel from Mfg. and then Customer from Channel) and two sell sides (Mfg. to channel and then Channel to Customer) is highly inefficient and affords numerous opportunities to re-engineer the model in order to more efficiently and effectively serve the customer.
Evolution is "Revolution"
The evolution opportunity isn't Mfg. Direct to Customer and Channel disintermediation. Rather, it is about customer "first", collaboration, a more coordinated marketplace and leveraging technology to capture waste associated with duplication of buying and selling activities and the process inefficiencies present in the 3 tier model. The opportunity is consolidation and re-engineering all sell side processes to be customer centric and redistributing the the waste to those who solve problems the best, first. Yes, it is disruptive to both Mfg. and Channel organizations and current roles. However, the old model and "full-serve" doesn't disappear - it just isn't on the growth trajectory with fewer customers willing to utilize their spend for that model every day. The concept of consolidation of "two" to "one" is easy and the benefits of simplifying likely intuitive. However, getting to a state of feasibility and options is complex.
Customer Initiated Alternative
One proven alternative and catalyst is leveraging the Mfg. Direct to Customer Model as an alternative purchase model. The model begins with the customer selecting their assortment from the Mfg. web site and buying through and to the channel of the customers choice where one option is the Mfg Direct Channel.
So How Might this Benefit the Customer?
The Mfg enabled process with the Customer initiating purchase intent from the Mfg. web site and then selecting a Channel to execute the transaction and perform fulfillment has many benefits. It is a bit predicated on the fact the customer has purchase intent for a brand or product and doesn't mind the Mfg. only brand bias if researching. What it does is "flip" the current model where customers visit a Channel site or physical store and then select from the assortment the Channel/ Store might have available, at the prices they choose to set. In this new digital model the Customer can first select the Brand and product they desire from the Mfg. on-site solution and then choose from the available "willing and able" Channel sellers that includes the Mfg. Direct option as an alternative. Customer benefits include:
- Access to all brands and products
- Process efficiency through shared customer relationships and systems including customer procurement integration and synchronization
- Once the foundation capabilities are in place - the remaining are options and alternatives you get to decide
I can help your organization design, develop and deploy solutions that includes enabling other channels participation. I possess a proven track record aligning Business needs with flexible IT solutions. Or I can simply help you explore the possibilities. I have a passion for developing solutions and doing old things new ways as well as innovation and new things new ways. Lets discuss your needs and see what we might collectively invent next.