38. Vending Machines for Distribution Customers?

MRO Vending Machines for Distribution Customers’ Locations are Hot

Big distributors such as Avnet, Fastenal, MSC, etc. report rapid installations of internet-connected, vending machines at customer locations. At Apexsupplychain.com read how their machines – installed by distributors – are:

  • For “high-use” SKUs (lots of picks) that are “mission-critical” (downtime costs are big)
  • Eliminating stock-outs and excess inventory
  • Reducing downtime with handy locations and 24/7 availability
  • Reducing re-ordering costs, etc.

But, Improving Customers’ Replenishment Systems is Old, Smart News

  • Starting in 1952, Sidney Port (check him out on Wikipedia) reinvented Lawson Products by creating storage bins for customers to stock and replenish small-dollar, don’t-be-out items. Lawson went public in 1970. Sid got very rich. See today’s bins at lawsonproducts.com.
  • In 1964, Max Hillman solved the problem hardware stores had selling just one washer, bolt, etc. At hillmangroup.com, read about their current solutions. PS: the Hillmans did well, too!
  • In 1978, an 18-year-old college kid, Neil Balter, started California Closets to maximize storage space in dorm rooms. He scored.
  • Lastly, the book The Life-Changing Magic of Tidying Up, about decluttering your home written by a Japanese cleaning consultant, is a current global, best-seller.

These stories prove that many humans – at home and business – are not as organized as they wish they could be. And, they like outside experts to solve their organizational/replenishment inefficiencies.

So, Give all your Big Customers Replenishment Savings!

With Line-Item-Profit Analytics (LIPA), distributors can zero in on the inefficiencies that exist in every big customer’s existing buying patterns.

  • Look at each customer’s buying statistics 11 different ways at the SKU level to find their hidden, unnecessary activity-costs or “noise”.
  • Share the stats with customers to make their costs shockingly visible.
  • Then, suggest that together you can do some rapid prototyping to create a better replenishment system that will improve both parties’ economics.
  • Best customers will have some good practices you can borrow, improve and propagate.
  • Evolve replenishment solutions for each customer niche.

Your new solutions will:

  • Win more loyalty and share of customer-spend.
  • Increase average Gross Margin Dollars (GM$s) per: pick, order, invoice, delivery, customer and sales call. All customers’ profitability will soar.
  • Reward all stakeholders, if you are the first to find and solve the noise.
  • And, LIPA information will tell you if and where vending-machines will deliver win-win returns and how to better stock them.

Learn more about LIPA at the APIC Conference in Toronto on September 22.  There are still some seats left!  Or, visit www.WayPointAnalytics.com where you can request a virtual demonstration!

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