The research will address questions for distributors and manufacturers on making new markets and the demand creation role of the distributor. “If you want to make a market what impact does that have on both cost and margin?” asked Marks. “It’s about the economics.” Marks and Indian River Consulting Group will conduct primary and secondary research, and develop an analytical framework for evaluating channel performance and effectiveness. “Market share gains are essential to manufacturers so what exactly does it take for distributors to satisfy those needs? That is the core question this research project will tackle,” said Emily Saving, HARDI’s director of education and research foundation.
“We are going to do some deep diving with a project development team comprised of several distributors and manufactures where people have agreed to share confidential and financial information. We are also going from the top down with some broad base surveys with the whole HARDI membership, both manufacturer and supplier side and the distributors and reps as well. We are going to cross tie it together so we actually understand the entire cost in the entire system” explained Marks.
The HARDI Foundation is supporting the effort, including raising the funds to cover the cost of the research. “We’re ready to make an impact on the industry,” said Bill Shaw, HARDI Foundation chairman and CEO of Standard Supply. “We are very excited about the possibility of what we will find.”
Shaw indicated that the project is already about 75 percent funded, and fully expects to fund the rest of the research. Nordyne, a HARDI supplier member and manufacturer of indoor comfort systems, was one of the first companies to sign on to participate as a manufacturer project team member. “Independent distribution has long been the lifeblood of our industry and participating in the HARDI Distributor Demand Creation project was too good of an opportunity for Nordyne to pass up,” said Philip Windham, vice president of sales for Nordyne. “Working hand in hand with HARDI, HARDI members, and Michael Marks will most certainly deliver substantial results that will benefit all facets of the HVAC channel. Spending time drilling down into the value of distribution and quantifying the significance of resources, relationships, and results made the decision to participate one of the easier ones we will make this year.”
Distributor project team members include: Johnson Supply, Houston; Standard Supply & Distributing Co. Inc., Dallas; Meier Supply Co. Inc., Conklin, N.Y.; GW Berkheimer Co. Inc., Portage, Ind.; Gustave A. Larson Co., Peewaukee, Wis., and Mingledorff’s Inc., Norcross, Ga. Manufacturer project team members include: Honeywell, Nordyne, Duro Dyne, Allied Air Enterprises, Heatcraft, and M&M Manufacturing.
To follow the research progress, visit the HARDI Foundation’s project page at www.hardinet.org/demand-quantification-project.
Publication date: 7/8/2013