Realigning The Aftermarket Strategy

October 13, 2004
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Changes in product distribution methods can be necessary to keep up with customers' increasing demands for timely and responsive shipments. One company that is keeping stride with changing trends is Emerson Climate Technologies. The repositioning of more than a dozen divisions serving the HVACR industry into Emerson Climate Technologies - and the transitioning of the business group's focus from the engineering and manufacturing of components to the delivery of system-wide solutions - was part of the company's goal of creating unprecedented opportunities for pull-through in the aftermarket.

"Emerson Climate is just beginning to engage customers in system-wide solutions that will represent millions of dollars of equipment needing regular replacement and service," said Ed Purvis, group vice president of Emerson Climate Technologies Refrigeration.

"And they will look to Emerson Climate for aftermarket support and the wholesalers and contractors who can keep them up and running. Today, we're realigning distribution strategies not only to support the Emerson Climate business transformation but also to help our distribution partners capitalize on the opportunities to grow their businesses."

Emerson Climate Technologies is realigning its distribution strategies to support the Emerson Climate business transformation and help the company’s distribution partners capitalize on opportunities to grow their businesses. This commitment to service includes implementing a new phone system at the call center with the ability to collect data, identify problems, and prioritize them.

Business Strategy

Mark Gibson, vice president and general manager of Emerson Climate Technologies Distribution Services, summed up the company's strategy this way: "This solutions-oriented business strategy requires putting a ‘solutions' distribution system in place. Strong distribution is a key to Emerson Climate's success. So we're committed to this distribution of Emerson products as we help our wholesalers serve their customers with an expanded line of products while delivering the highest level of service and technical support."

One piece of that commitment is meeting the demand for replacement components. "Emerson is working side by side with contractors and end users to better understand their business needs and issues as well as gain their insights on product design and services," said Bob Labbett, vice president of marketing for Emerson's Distribution Services.

"Our sales force is spending more time with key decision-makers, discussing the features and benefits not only of Emerson Climate Technologies products but of our new solutions approach. What we're learning is that having all products available at one wholesaler is key to success."

Also key to this distribution strategy is the implementation of new branding guidelines for the aftermarket. "We're moving away from the PrimeSource® distinction, which was tied exclusively to Copeland compressors and condensing units, toward Emerson Climate Technologies Authorized Wholesalers," said Labbett. "Additionally, we're helping our business partners market these expanded product lines to fully leverage the Emerson brand."

Another component of this commitment to service is a series of improvements in the physical distribution of Emerson products. Leveraging new layout and additional space, Emerson instituted a series of process improvements designed to improve product availability and delivery performance. These changes included giving wholesalers better freight rates, as well as automatically managing weight for more effective loading of trucks without exceeding weight limits.

A new phone system at the call center with the ability to collect data, identify problems, and prioritize them - along with enhanced customer service to support this critical initiative - has reduced abandoned calls by 50 percent, according to the company.

On-time delivery continues to be a focus. Distribution Services is also accelerating the development of electronic communication and transaction tools in the aftermarket.

Strategy Partners

Emerson Climate Technologies' shift to this distribution strategy and the changes Distribution Services has been initiating are attracting the attention of wholesalers who have partnered with Copeland, White-Rodgers®, Flow Controls, or HVACR Motors in the

past. Today, Copeland PrimeSource wholesalers are looking at the advantages and requirements of being an Emerson Climate Technologies Authorized Wholesaler.

One wholesaler supporting the new strategy is C.C. Dickson Co., a full-line wholesaler providing HVACR parts and equipment from 108 branches throughout the Southeast.

"We seek out relationships like the one with Emerson Climate for the efficiencies in doing business," said C.C. Dickson CEO Jack DeMao.

"There's one sales discussion instead of dealing with multiple salespeople. Our logistical costs go down and it's easier to get things right; the economies of scale in day-to-day business transactions save us money; and we eliminate inconsistencies in marketing through the synergies between Emerson product lines and marketing programs."

Young Supply Co., which serves Michigan and northern Ohio with 16 branches, is another strong supporter of this integrated distribution strategy.

Director of marketing Ron Vallan Jr. stated that Young Supply shares Emerson's belief in the importance of providing total solutions. As a matter of fact, that's the way they are positioning some of their branch locations - as total solutions providers - in 2004 marketing and advertising programs.

"We know we can serve our customers more effectively with a full line of products," Vallan stated. "That's why we were pleased to add Emerson Climate Technologies Flow Controls and HVACR Motors," he said.

"With the demand Emerson is creating with end users and contractors for retail solutions, Young Supply wants supermarkets and other retail operations to know we can fulfill all their replacement and technical support needs."

Progress Supply, with Cincinnati, Columbus, and Dayton branches, has added Emerson Climate Technologies Flow Controls and HVACR Motors to its inventories. "We're really proud to be offering more to our customers," said Technical Specialist Kim Ryan.

Gibson expects support for full-line distribution like this only to grow. "We're giving our distribution partners a greater opportunity than ever before.

Tom Bettcher, Emerson Climate Technologies business leader, said, "We believe in and support this partnership that empowers us to win together. Emerson Climate will continue to identify the products and services our customers need and lead the industry in the manufacturing and marketing of system-wide solutions. And we will rely on our wholesalers' core strengths in distribution and strong relationships with contractors to fulfill the demand we are creating."

Publication date: 10/18/2004

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