Grow Together or Grow Apart - ANIQ - Home QUINTA SESION... · 2012-10-19 · Grow Together or Grow Apart Successful Producer-Distributor Collaboration ANIQ Meeting, Mexico City October

Grow Together or Grow Apart

Successful Producer-Distributor Collaboration

ANIQ Meeting, Mexico City

October 26, 2012

Ed Ziegler Marketing Manager - Americas Corporate Marketing & Sales DuPont Company

Andy Kannurpatti Global Channel Practice Leader Corporate Marketing & Sales DuPont Company

&

Agenda

2

3

4

1 DuPont At-A-Glance

Why do producers need distributors?

How can they work together to grow?

What trends should distributors prepare to face?

ANIQ Meeting - Mexico City October 26, 2012 2 ©2012 DuPont Company

3

DuPont is a Market Driven Science Company

To be the world’s most dynamic science company,

creating sustainable solutions essential to

a better, safer, healthier life for people everywhere. DuPont Vision

7% Long Term Sales CAGR • Food / energy / protection trends

• New products and applications

• Building on our success in developing markets

12% Long Term EPS CAGR* • Innovation

• Differential management

• Ongoing productivity

• Margin expansion

* Excludes significant items. Refer to company website for detailed

reconciliations of non-GAAP measures © National Geographic images

ANIQ Meeting - Mexico City October 26, 2012 ©2012 DuPont Company

4

2011 DuPont Business Sales Mix

24%

7%

20% 11%

18%

8%

10% 2%

2011 Sales $38B

Agriculture

Nutrition

& Health

Performance

Chemicals Performance

Coatings

Performance

Materials

Electronics

& Communications

Safety

& Protection

Industrial Biosciences

Business Units

Competencies


5

Sales to Developing Markets

2011 Global Sales of $38B Developing Market Sales ($B)

U.S. and

Canada

Deve

lop

ing

Asia

Latin Am

Developed Europe

2011 Developing Markets: 34% of company sales

Growing to 40% of total company sales by 2015E

Latin America incl. Mexico represents a third of the developing markets


Agenda

2

3

4






Distributors are an important channel to deliver products,

services, and information that customers value

Producer Distributor End-User

Producers want:

• Reach local customers with right

products at right time (inventory).

• Train local customers to use the product

• Deliver positive tailored customer

experience (tailored full solutions, post

sale service)

• Secure End-User input into designing

new offerings and positionings

• Optimize cost-to-serve

Customers want:

• Right Products when needed

• Products in the form and quantity they

need (e.g., not in bulk)

• Advice on product selection and how to

use it

• Post sale service & support

• Responsiveness to changing interests

and needs

• Fair and flexible price & terms

Value Delivery


8

How distributors or producers may view value

chain dynamics

Competitive Collaborative

Distributors are a necessary evil.

Distributors can add value by helping

to create and deliver the “promise”.

Distributor decisions can be

independent and have limited impact

Producer-Distributor alignment and

collaboration can achieve mutual

interests across the VC.

Distributor is the final customer.

End user is the final customer.

The Producer manages the Route to

Market.

Producer-Distributor have distinct

roles to assure the channel is

responsive and adaptive to changing

end user needs.

Adapted from Pearson, 1981


Distributors’ importance to Producers increases as they add

greater value up and down the value chain


What am I doing

for customers?

Am I

understanding

where and how to

serve them better?

What am I doing

for the Producer?

Am I sharing my

market / customer

intelligence so that

the Producer can

help me to grow?

What capabilities

do I need to build?

Am I increasing

my market

coverage to grow?


Well aligned distributor-producer relationships result in

superior performance in meeting customer needs

Customer’s Needs & Preferences

Distributor’s Capabilities &

Objectives

Producer’s Offerings & Objectives

Extent to which

the Distributor

and Producer

are willing and

able to satisfy

customer needs

and each other’s

objectives.


Adapting to

complexity of sale and

number of customers

is important for a

channel to stay

relevant to the

producer

Producers seek channel types based on the complexity of sale and

number of customers to reach

Co

mp

lexi

ty o

f Sa

le

Number of Customers

Hi

Hi

Lo

Lo

Reach Cost Efficiency Service Quality





Agenda

2

3

4






A solid interdependent Producer-

Distributor collaboration, based

upon:

- common interests

- distinct balanced responsibilities

- open sharing of information

- integrated strategy and actions

can achieve mutual success.

Execute

Be Transparent

Give & Take

Trust

A channel cannot deliver sustainable results unless it continuously

improves the total customer experience with the “offer” and the

organization.


Trust: The foundation of any relationship

CREDIBLE INTERDEPENDENT COMMITTED

TRUST

Where are you with your Producer or Distributor?

Which is the right relationship between the

Producer and Distributor?


http://www.imagetrail.net/out/635274/4/135775

http://www.imagetrail.net/out/1920861/1/380026

Give & Take: Both Distributor & Producer need to

invest in and derive value from the relationship

Producer Distributor

Producers want:

• Attention to their products

• Focus on their segments

Distributors want:

• Products that have faster

turns

• Focus on segments with

growth potential

Do you and your producer talk openly about each other’s wants?

About roles and responsibilities?

And how these can be met while meeting your customers’ needs?


Be Transparent: About issues and opportunities

• Do you, as a distributor, share point-of-sale information with your

producer?

• Do you, as a producer, plan your production jointly with your

distributor?

• How much discussion about customers’ unmet needs do you have

with your distributor/producer?

Distributors are a key link to customers

Do you plan your growth strategy together?



Execute: Set goals, develop plans, & track performance

together

On-going dialogue and joint-planning lead to successful execution and a win-win for distributor and supplier

Annual Plan

Quarterly Review

Adjust Plan

Modify Strategy

Marketing Strategy


Agenda

2

3

4






Major Trends: Bigger, Faster & Smarter

Globalization: Cross-border selling and increasing buyer power will continue to grow as global presence of customers increases

Market Volatility: Economic issues and slow recovery trends will continue to be the norm in the new reality

Market Complexity: Increasing specialization and pace of change will continue to drive the need to be agile and targeted

Technology: Increasing use of e-Commerce, CRM and other smart technologies are improving efficiencies, customer intelligence, and organizational responsiveness.


Addressing the impact of the trends needs to be viewed as

opportunity to be successful in the future

Trend Distribution Implications

Globalization • Need to drive supply chain efficiencies to lower

operating cost

• Need to get scale or get specialized

Market

Volatility

• Better financial risk management

• Better inventory & WH management; demand

forecasting

Market

Complexity

• Better and quicker sensing and intelligence on customer

dynamics

• May need to focus on selective segments, acquire new

value-add capabilities

Technology • Investment in IT and training to sustain channel

competitiveness and increase sales productivity


21

Key Points

• Focus on increasing relevance to customers and

producers.

• Well aligned distributor-producer relationships result in

superior performance in meeting customer needs.

• A solid interdependent Producer-Distributor

collaboration based on trust and transparency results

in mutual success.

• Addressing the impact of the market trends is an

opportunity to be successful in the future.


Documents

Grow Together or Grow Apart - ANIQ - Home QUINTA SESION... · 2012-10-19 · Grow Together or Grow Apart Successful Producer-Distributor Collaboration ANIQ Meeting, Mexico City October