Wholesalers move to e-commerce

July 18, 2000
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ATLANTA, GA — Wholesalers meeting here in mid-September made a historic move in voting to adopt a standard that should pave the way for electronic commerce — two words that didn’t make sense together just a few years ago.

Despite some hand-wringing and hesitation about how quickly to proceed, and how much to spend on it, the vote was unanimous.

This was the result of a special meeting held by the Northamerican Heating, Refrigeration & Airconditioning Wholesalers (NHRAW) and, in particular, its Distribution/ Logistics Management Committee. It has been grappling with this question for several years, and is the hot topic among hvacr wholesalers.

The next step is for several key wholesalers and manufacturers to tackle e-commerce and its sister, electronic data interchange (EDI), head-on, then report their findings back to NHRAW so that others don’t make the same mistakes.

Denise Beaver of Hart & Cooley, Holland, MI, was one of several manufacturers attending the meeting. She echoed the sentiments of many when she said she considers this wave of the future “interesting but confusing.”

Hart & Cooley has been asked (or directed) by some of its large retail accounts already, such as Lowe’s and Home Depot, to use only e-commerce when ordering product.

Evolve or perish?

This is where the main thrust has come from — the retail sector — but Russ Broeckelmann, Precision Distribution Systems, The Woodlands, TX, and chair of the distribution committee, said, “It holds the key to our survival.”

Broeckelmann cited a study by one wholesaler group who said that use of e-commerce could reduce the cost of distribution to the final end-user by as much as 20%. “What a driver,” Broeckelmann exclaimed.

The goal of e-commerce is to smooth inventory flow, making sure products are shipped correctly and on time. But ultimately, another goal is to take the cost out of distribution — which is important to everyone, including contractors and their customers.

Many at the meeting were enthusiastic, yet at the same time reluctant to go ahead.

It was pointed out that few in the hvacr industry, either manufacturers or wholesalers, are either into e-commerce or set up to take the plunge. Johnson Controls and Honeywell are the furthest along. As usual, many are waiting for others to do so first.

Scott Stratman, president of The Distribution Team, said the goal of e-commerce is simply to “buy smarter, ship smarter.”

Smooth flow of inventory is more crucial than ever today.

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