How Wholesale & Distribution Can Succeed in Digital Commerce According to 5 Expert Voices

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What key trends and biggest challenges are impacting the industry right now? Find out here.

In today's rapidly evolving landscape, the wholesale and distribution sector finds itself at a crossroads, with digital commerce reshaping the very fabric of the industry. As B2B buyers increasingly demand seamless online experiences mirroring their B2C counterparts, the sector is witnessing a transformative shift. Personalization, AI-driven analytics, and omnichannel strategies are on the rise, elevating customer engagement and satisfaction. However, formidable challenges such as global supply chain disruptions triggered by events like the pandemic and geopolitical tensions loom large. Sustainability concerns are also gaining prominence, necessitating eco-friendly practices and responsible sourcing. In this dynamic environment, W&D players must navigate these complexities, leveraging insights from expert voices to unlock latent capabilities, outpace competitors, and carve a prosperous path forward.

Don Yerger

Head of PreSales and Delivery at CriticalRiver CriticalRiver Website

What do you see as the biggest challenges facing the wholesale and distribution sector at the moment?

[DY]:

Distribution and wholesale companies are currently grappling with significant challenges, primarily to meet the new and rapidly evolving nature of consumer behaviour and their expectations. Just like the B2C sector, B2B customers expect a high-touch experience across the brand, e-commerce, logistics and inventory management. 

The rise of e-commerce has transformed how customers shop, it is driving increased demand for seamless online experiences and swift deliveries, thereby pressuring traditional distribution models to adapt.  Combining this with recent inflation has made transparent pricing a strong factor in the purchase decision; the relentless pursuit of competitive pricing, although needed, can erode profit margins, necessitating a delicate balance.

 

Supply chain disruptions pose another formidable challenge. The global pandemic highlighted the vulnerabilities of complex supply chains, leading to delays, shortages, and increased costs. Striking the right balance between efficiency and resilience has become critical to navigating unpredictable disruptions.  

Using effective inventory management and storage cost optimization help companies reduce shipping and delivery costs, but it is difficult to strike the right balance to meet local demand while avoiding excess inventory and delivery costs. 

The drive to enter the direct-to-consumer space has increased the competition in the distribution and wholesale space, and existing wholesalers must move quickly to differentiate themselves through value-added services, specialized offerings, or unique partnerships.

Which key trends and innovations will have the strongest impact on the wholesale & distribution industry?

[DY]:

We have seen important trends take hold across our customers in the distribution and wholesale space from optimizing operations and logistics to building hyper-personalized customer experiences; all of these are enabled by adapting new technologies and empowering their data analytics. 

Optimizing operational excellence stands out as a pivotal strategy for reaping significant benefits in distribution and wholesale. Streamlining processes, enhancing supply chain visibility, and adopting data-driven decision-making improve efficiency, reduce costs, and heighten customer satisfaction. Ageing infrastructure poses a challenge, but integrating AI, machine learning, and other emerging technologies may offer a solution. 

Modernizing operations with these technologies enables predictive maintenance, real-time insights, and enhanced resource allocation, ultimately driving greater operational efficiency. Robotics, IoT devices, advanced warehouse management and demand planning optimization systems can enhance inventory accuracy, order fulfilment, and overall productivity, mitigating issues associated with manual processes, especially when coupled with AI-powered tools.

Creating value for the customer is taking centre stage as companies recognize the need to offer more than just products. B2B hyper-personalization is becoming a defining trend to drive customer loyalty and growth. Leveraging customer data using advanced analytics allows wholesalers to tailor offerings to individual customers, fostering stronger relationships and driving customer loyalty.



What strategies do you recommend for wholesale & distribution companies to market and sell their products through digital channels effectively?

[DY]:

In the dynamic landscape of an evolving customer-centric environment for distributors and wholesalers, expanding and excelling in their digital channels is crucial for sustained success. Leveraging customer data is the cornerstone of this strategy; harnessing insights about preferences and behaviors empowers tailored marketing efforts for both B2B and B2C segments providing improvements to the customer experience.  

Establishing always-on visibility is essential by building a continuous online presence that supports your customers 24X7 just as an in-person sales experience would. This ensures that potential buyers can access relevant information and buy your products anytime. 

This has become much more important from the elevated expectations customers have from their personal B2C experiences. We are in a digitally connected world where customers expect immediate gratification. Fully integrating the online storefront with back-office systems amplifies efficiency and visibility through real-time synchronization giving accurate inventory data, order processing, and customer information; nothing is worse than a surprise backorder for your customers.

This elevated expectation requires transitioning from simply selling online to conducting business online with all the needed self-service options available. It helps to empower customers to manage their orders, payments, and account information independently, enhancing convenience and reducing administrative load. 

Companies evolve through improving levels generally start with simplifying the purchasing journey which will drive immediate conversion increases. Providing enhanced merchandising and product assortments allows them to capitalize on the customer’s need and boosts the average order value and customer satisfaction.  

After reading my suggestions above, remember that it all starts with knowing your customer, leveraging the data you have, and getting what you don’t have. Only once you can get this information, can you analyze it with new technologies and build your strategy for elevating your customer-centric focus across your digital channels.



What do you offer companies in wholesale & distribution, and why is Spryker the right partner for you?

[DY]:

CriticalRiver has played a pivotal role in enhancing customer engagement within the distribution and wholesale industry by providing advanced CRM and CPQ solutions tailored to industrial goods manufacturers. Our partnership with Spryker signifies a significant step forward, enabling us to broaden our service offerings and address clients' evolving needs as they explore new sales channels and markets. Using Spryker's innovative composable commerce platform, we tackle the unique challenges faced by Wholesale & Distribution players. 

Our approach involves delivering a flexible, modular solution that seamlessly adapts to the specific requirements of each business. Leveraging Spryker's composable architecture and API-driven integrations, CriticalRiver has successfully developed headless storefronts catering to our clientele in the US. 

Furthermore, we've developed a Salesforce CRM/CPQ connector that incorporates the power of a world-class CRM with a world-class commerce platform to streamline the management of Spryker e-commerce quotes via the Salesforce Sales Cloud. This strategic partnership enhances customer engagement and operational efficiency for distributors and wholesalers, propelling them toward greater success within their dynamic landscape.

Teresa Cain

Director of Product Management, User Experience & Design at TreviPay TreviPay Website

What do you see as the biggest challenges facing Wholesale & Distribution at the moment?

[TC]: The biggest challenges facing the industry are the ability to forecast demand — more specifically the likelihood of predicting repeat buyers. In B2B, repeat buyers increase the LTV (lifetime value) two to five times over customers that make one-time purchases. However, it can be challenging to predict why one customer makes a repeat purchase and another may not. At TreviPay, we believe loyalty begins at the payment meaning the creation of a seamless experience is what makes customers return and buy more whether online with a one-click checkout or in-store with one tap on the app. 

Which key trends and innovations will have the strongest impact on Wholesale & Distribution?

[TC]:

Key trends include seamless experiences with “no touch” or “one-touch” experiences such as automated ordering, digital payments, QR Codes and vouchers or rebates. Customers want instant gratification and don’t have time to waste clicking through multiple screens. Customers also expect to be rewarded as a repeat buyer. B2B eCommerce platforms continue to look for new ways to keep the accelerated customer growth they achieved at the height of the pandemic by launching more sophisticated eCommerce sites equipped with vouchers and rebates and the ability to customize their experience in app to stay competitive with other platforms and in-person experiences.

What strategies do you recommend for Wholesale & Distribution companies to market and sell their products through digital channels effectively?

[TC]:

Reward Customers for Paying on Time: When you incentivize customers to pay on time, you are building an ongoing relationship that should lead to return purchases. At TreviPay, we have wholesale clients that offer up-front discounts off purchases for all businesses that are integrated into their payment experience. This rewards program allows them to build loyalty with their users and gives them with discounts at checkout. 

Personalization: Customers want more than a product, they want an experience. TreviPay is proud to partner with wholesale businesses to create custom experiences for customers such as rebates, digital vouchers or discounts paired with easy QR code scanning and payment at checkout giving consumers the opportunity for an AI-driven experience that provides recommendations of what they should buy, why they should buy it and when it’s time to make a purchase again.   

Flexibility: Give customers the opportunity to make a purchase, whenever and wherever they need it. Whether in-store, on-site or online, customers expect that level of flexibility. 



What do you offer companies in Wholesale & Distribution, and why is Spryker the right partner for you?

[TC]:

Wholesalers are challenged with the ability to forecast demand in a saturated market full of buyers who purchase in-store and online, which means they have to be the best in the business across every platform and avenue so they need to focus on creating flexibility with the customer experience. We partnered with Spryker to foster flexibility with wholesalers and their customers. Spryker can help create the flexibility our clients need to build the best digital solutions and wholesale marketplace experiences that will help accelerate growth and adoption for our customers, whether in-store, on-site or online.

Dr. Philipp Hoberg

Head of Concept & Requirements Engineering at valantic valantic Website

What do you see as the biggest challenges facing Wholesale & Distribution at the moment?

[DPH]:

The wholesale industry is facing several major challenges that require attention and creative solutions. One such challenge is the growing trend of manufacturers moving towards direct-to-consumer models.
This shift away from traditional wholesale practices can have a significant impact on wholesalers who depend on manufacturers for their inventory.
As manufacturers cut out the middleman, wholesalers may struggle to find new sources of inventory and maintain their margins.
This trend also puts pressure on retailers to develop digital platforms and additional services to prevent customer migration towards D2C-offering of those manufacturers. 

Another challenge is the need to streamline online and offline channels to provide a seamless shopping experience for B2B customers. 

Last but not least wholesalers need to deal with the constantly changing role of technology, such as the shift to mobile and IoT, while maintaining personal relationships with customers. 

In summary, successful wholesalers will need to be agile, innovative, and adaptable to overcome these challenges and thrive in an increasingly complex and dynamic business environment.

Which key trends and innovations will have the strongest impact on Wholesale & Distribution?

[DPH]:

We believe that these are the three key trends in the wholesale industry that will have a major impact in the future:

  • Valuable Services: Wholesalers are using digital tools and services to offer personalized and convenient online experiences. This is achieved through customer portals that provide real-time inventory data, order tracking, and other useful information based on customer data. By doing this, wholesalers can increase customer loyalty and satisfaction.
  • Automation and AI: Automation and AI technologies are transforming the wholesale industry by streamlining operations, reducing costs and improving accuracy. Wholesalers are using these technologies to automate tasks such as inventory management, order fulfillment, and supply chain logistics, freeing up time and resources to focus on higher-value activities.
  • Sustainability: Sustainability is becoming increasingly important as customers demand environmentally friendly products and practices. Wholesalers are investing in sustainable solutions such as eco-friendly packaging, renewable energy and waste reduction programs. By prioritizing sustainability, wholesalers can differentiate themselves in the market and appeal to a growing number of socially conscious consumers. As a result, wholesalers can address new customer groups or even entirely new business portfolios, leading to 'green' growth. Sustainability initiatives need to take place at different levels of an organization: tactical, operational and strategic.

These three trends offer significant opportunities for wholesalers to remain competitive and deliver value to their customers. By extending digital services, implementing sustainability practices, and utilizing automation and AI tools, wholesalers can improve efficiency, enhance the customer experience, and build a reputation as a responsible and forward-thinking business.

What strategies do you recommend for Wholesale & Distribution companies to market and sell their products through digital channels effectively?

[DPH]:

Besides the above-mentioned, prioritizing sustainability to market and sell products through digital channels effectively, wholesalers should prioritize their online presence and embrace e-commerce platforms. By creating a user-friendly website, enhancing the overall attractiveness of the platform with the help of value-creating digital service offerings and by optimizing content for search engines, companies can attract and engage with customers. Wholesalers can also extend their business to online marketplaces to expand their reach and access new markets.

Data analytics can be used to gather and analyze customer behaviour and preferences. By tailoring messaging and promotions to individual customers based on their past behavior and preferences, companies can improve conversion rates, and enhance customer loyalty and retention. Digital tools such as customer portals and automated marketing platforms can be leveraged to provide a personalized experience to customers. 

Prioritizing sustainability is also important. By prioritizing sustainable practices and promoting eco-friendly products through their digital channels, companies can differentiate themselves in the market and appeal to a growing number of socially conscious consumers.

By implementing these strategies, wholesalers can effectively market and sell their products through digital channels. By leveraging digital tools and insights, companies can succeed in a rapidly evolving business environment and stay ahead of the curve.

What does Spryker offer companies in Wholesale & Distribution?

[DPH]:

valantic CX offers a range of services for companies in the wholesale sector. These include services such as digital business, UX and technology consulting, as well as the implementation of digital solutions for e.g., e-commerce, customer relationship management, data-driven marketing or product information management. Additionally, the valantic group provides expertise in the areas of data analytics and artificial intelligence to help wholesalers improve their decision-making processes and drive growth. valantic's services are designed to help wholesalers adapt to the changing market landscape and stay ahead of the curve in an increasingly digital business environment.

Spryker is the perfect partner for valantic due to its highly flexible and modular e-commerce platform. Spryker's technology enables valantic to provide customized and scalable solutions for wholesalers that can adapt to their changing needs and growth ambitions. Additionally, Spryker's deep expertise in the retail industry, combined with valantic's consulting and implementation services, provides a powerful combination of technology and business expertise to help wholesalers succeed in an increasingly digital environment.

Brett Noneman

Sr. Director, CX Practice at SkillNet SkillNet Website

What do you see as the biggest challenges facing Wholesale & Distribution at the moment?

[BN]:
  • Ever-increasing needs for data and analytics to reduce inventory carrying costs, optimize product mix, streamline fulfillment, and tailor service offerings
  • Increasing demand for quality omnichannel experiences for complex B2B scenarios
  • Aging sales force/labor concerns – highly technical sales teams are aging into retirement without sufficient backfill.  Warehouse and driver labor shortages are increasing costs and straining systems and processes.
  • Changing customer dynamics – longstanding customers with legacy processes are adopting new tools and processes or being replaced by new customers with more advanced tooling.
  • Looming opportunities/threats from AI and robotics – AI and robotics are major long-term investments in the wholesale distribution space, requiring extensive changes to processes and months or years of dedicated resources to implement.

Which key trends and innovations will have the strongest impact on Wholesale & Distribution?

[BN]:
  • AI innovations will have a significant impact on order and PO entry and processing, streamlining order entry, reducing the demands on sales staff, and improving customer experience.
  • AI will also lead to improvements in customer self-service, improved inventory management, and smart procurement.
  • Omnichannel commerce, including custom catalogs, tailored front-end experiences, and integrated sales, CRM, and e-commerce personalization, will drive increased adoption of digital channels.
  • Marketplaces will lead to more distributors making “endless aisle” plays, leading to an increased focus on services and expertise-based or price-based competition.
  • Increased availability of third-party fulfillment services will drive heightened expectations for same-day delivery and increased delivery frequency.  This may also increase reliance on just-in-time fulfillment processes at the customer level.
  • In certain industries, Blockchain will have a major impact, allowing novel solutions to track product country of origin, creating increased visibility to supply chain issues, and allowing for improvements in multi-party project planning (I.e., building trades)

What strategies do you recommend for Wholesale & Distribution companies to market and sell their products through digital channels effectively?

[BN]:
  • Strong emphasis on customer research – understanding customer needs and preferences is key to driving adoption, resulting in ROI on the investment.
  • Platform personalization – typical B2B customers benefit heavily from tailored experience, including product mix personalization, custom pricing, and closely aligned business roles and permissions.
  • End-to-end supply chain visibility/transparency with up-to-the-minute inventory levels and delivery promise times. Product availability is key to customer digital adoption.
  • Comprehensive digital services – in order to be truly omni-channel, a customer needs to be able to service any order through digital platforms.  If product mix, product services, price negotiation, or delivery options are restricted through digital channels, customers will not adopt them.
  • Leveraging SEO and SEM to move long-tail, slow-moving products and opening a B2C experience to move aging inventory can be a strong benefit of digital commerce.
  • Leveraging marketplaces can improve customer experience and encourage customers to make a preferred distributor a “one-stop shop” for day-to-day needs, particularly if high service levels are maintained with marketplace products.
  • Product content is critical as well. Incorrect or inaccurate product content erodes trust in the digital channel. Missing or inaccurate product relationships can prevent customers from locating products and can reduce average order values due to missed accessory item purchases.

What do you offer companies in Wholesale & Distribution, and why is Spryker the right partner for you?

[BN]:
  • Business consulting and strategy services
  • Design, customer experience, UX, and UI services
  • B2C implementation or re-platforming
  • B2B implementation or re-platforming
  • Marketplace implementation
  • Omnichannel strategies implementation and integrations (BORIS, BOPIS, STS, LSAO, etc.)

Spryker’s headless composable platform allows for ease of development and supports all critical strategies for success in wholesale distribution.  Its flexible, modular structure allows it to easily integrate available services to allow for personalization, real-time data, and access to complex business services and supports best-in-class front-end experiences.  This also decreases the total implementation cost and long-term maintenance costs, driving down TCO and reducing the time to a customer’s return on investment.

Spryker’s ability to support B2C, B2B, marketplaces, and unified commerce with IOT makes it an easy recommendation for any customer.



Simon Vieracker

Global Lead – Retail at Spryker Spryker Website

What do you see as the biggest challenges facing wholesale & Distribution at the moment?

[SV]:

Supply chain disruptions: The industry heavily relies on global supply chains, which can be vulnerable to disruptions such as natural disasters, political instability, or pandemics. These disruptions can lead to delays, shortages, and increased costs, requiring effective risk management and contingency planning. "The Wholesale and distribution industry needs to prioritize supply chain resilience through diversification, visibility, and proactive risk management strategies. This includes building alternative sourcing options, leveraging advanced analytics for demand forecasting, and fostering strong supplier relationships.

Increasing customer expectations: Customers now expect faster delivery, real-time tracking, personalized experiences, and seamless omnichannel interactions. Meeting these expectations requires adopting advanced technologies, optimizing logistics, and enhancing operational efficiency to ensure timely and accurate order fulfilment. "Customer expectations have evolved, and Wholesale and distribution companies must embrace technology-driven solutions like real-time inventory tracking, AI-powered demand sensing, and personalized customer experiences to meet these demands. Building a seamless omnichannel strategy will be critical for success.

E-commerce and digital transformation: The rise of e-commerce has transformed the Wholesale and distribution landscape. Companies need to adapt to the digital age, and invest in robust e-commerce platforms, online marketplaces, and automation technologies to stay competitive, attract new customers, and streamline their operations. "The Wholesale and distribution industry must adapt to the digital revolution by embracing e-commerce platforms, investing in automation and robotics, and leveraging data analytics for customer insights and operational efficiency gains. Companies that fail to embrace digital transformation risk losing market share.

Which key trends and innovations will have the strongest impact on Wholesale & Distribution?

[SV]:

Wholesale distributors are facing a multitude of challenges in today's marketplace. The emergence of online marketplaces is gradually eating into their traditional customer base, and this trend is expected to persist in the foreseeable future. Moreover, distributors are struggling to differentiate themselves and provide the personalized services that B2B buyers now demand from marketplaces.

The global supply chain has also been disrupted, with events like the COVID-19 pandemic and the Suez Canal chaos forcing distributors to prioritize local dependencies and navigate international regulations that impact their procurement capabilities. The ability to effectively manage the supply chain and offer reliable insights to customers is crucial for delivering a positive customer experience and ensuring loyalty.

However, wholesale distributors are grappling with a talent crunch when it comes to filling digital transformation roles. Skilled individuals increasingly seek out organizations with a social purpose and a commitment to making a positive impact. Unfortunately, most distributors have not invested in supporting social causes, and even if they have, they struggle to effectively communicate their efforts through social media, a vital channel for attracting talent and educating potential customers about their brand. This talent shortage poses a significant obstacle to their digital transformation endeavours.

 

Fortunately, cloud technology offers a viable solution to these industry challenges. By reducing technology costs and decreasing reliance on IT infrastructure, wholesale distributors have the opportunity to invest in innovation and reshape their business models in the coming years. Cloud solutions can support key distribution processes and enable the optimization of traditional operations while facilitating the evolution of business models.

One notable evolution is the adoption of new business models, such as selling services and subscriptions. While the traditional buy, hold, and sell model remains prevalent, some distributors are boldly venturing into offering services and subscriptions to drive revenue growth and boost profit margins. For instance, vendor managed inventory (VMI) services leverage sensors and machine learning to automate replenishments, reducing customer costs while enhancing their experience. Implementing subscription-based billing models allows distributors to generate accurate revenue forecasts on a monthly and annual basis, ensuring steady cash flow.

Embracing these new business models empowers distributors to forge stronger customer connections, outperform competitors, and swiftly realize returns on their investments in tools and innovative practices. Ultimately, cloud solutions, combined with strategic shifts in business models, are pivotal in overcoming industry challenges and driving success in the wholesale distribution sector.

What strategies do you recommend for Wholesale & Distribution companies to market and sell their products through digital channels effectively?

[SV]: Wholesale distributors should expand their traditional offline operations by embracing B2B e-commerce platforms. This shift allows them to extend their reach globally and enhance the buyer experience while lowering costs. Distributors are either developing their own eCommerce stores or leveraging established platforms like Amazon and Walmart. These platforms bring efficiency to their operations and offer valuable performance data on a product level. Additionally, startups and scaleups are developing technology stacks to seamlessly integrate with eCommerce platforms, enabling advancements in marketing, sales, dropship automation, and expanding customer reach.

What does Spryker offer companies in Wholesale & Distribution?

[SV]:

Spryker is a cloud-native, headless commerce platform that offers a comprehensive set of features and capabilities for companies in the wholesale and distribution industry. These features include:

  • A flexible and scalable architecture: Spryker is built on a microservices architecture, which makes it highly flexible and scalable. This means that it can be easily adapted to the specific needs of your business.
  • A wide range of features: Spryker offers a wide range of features that are designed to meet the needs of wholesale and distribution businesses. These features include product management, order management, inventory management, customer management, and reporting.
  • A headless commerce approach: Spryker takes a headless commerce approach, which means that the front-end and back-end are decoupled. This gives you the flexibility to choose the front-end platform that best suits your needs.
  • A cloud-native platform: Spryker is a cloud-native platform, which means that it is designed to be deployed and managed in the cloud. This makes it easy to scale your business as your needs grow.

In addition to these features, Spryker also offers a number of benefits for companies in the wholesale and distribution industry, including:

  • Increased efficiency: Spryker can help you to improve efficiency in a number of areas, including order management, inventory management, and customer management.
  • Improved customer experience: Spryker can help you to improve the customer experience by providing a more personalized and engaging shopping experience.
  • Increased agility: Spryker can help you to be more agile and responsive to market changes.
  • Reduced costs: Spryker can help you to reduce costs by eliminating the need for multiple systems and by providing a more efficient and streamlined operating model.

If you are a company in the wholesale and distribution industry, Spryker can be a valuable tool to help you to improve your efficiency, customer experience, agility, and profitability.

Here are some specific examples of how Spryker can be used by companies in the wholesale and distribution industry:

  • A wholesaler can use Spryker to create a B2B portal that allows their customers to place orders, track inventory, and manage their accounts.
  • A distributor can use Spryker to create an online marketplace that allows them to sell products from multiple manufacturers.
  • A manufacturer can use Spryker to create a direct-to-consumer (D2C) website that allows them to sell products directly to consumers.

Spryker is a powerful platform that can be used to solve a wide range of challenges faced by companies in the wholesale and distribution industry. If you are looking for a way to improve your efficiency, customer experience, agility, and profitability, Spryker is a platform worth considering.

About Spryker

Spryker is the leading global composable commerce platform for enterprises with sophisticated business models to enable growth, innovation, and differentiation. Designed specifically for sophisticated transactional businesses, Spryker’s easy-to-use, headless, API-first model offers a best-of-breed approach that provides businesses the flexibility to adapt, scale, and quickly go to market while facilitating faster time-to-value throughout their digital transformation journey. As a global platform leader for B2B and B2C Enterprise Marketplaces, IoT Commerce, and Unified Commerce, Spryker has empowered 150+ global enterprise customers worldwide and is trusted by brands such as ALDI, Siemens, ZF Friedrichshafen, and Ricoh. Spryker is a privately held technology company headquartered in Berlin and New York backed by world class investors such as TCV, One Peak, Project A, Cherry Ventures, and Maverick Capital. Learn more at spryker.com.

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