Recently I was flipping through the October issue of ElectroIndustry, NEMA’s publication, and saw this ad for IDEA recognizing their Platinum manufacturers.
While this is a recognition program, it recognizes these 28 manufacturers for the quality of their data in the Industry Data Warehouse (IDW).
And when you consider the percentage of industry sales that these companies represent, it starts becoming significant, and presumably the distribution equipment / controls manufacturers are also working to achieve Platinum level, which would further accelerate the percentage of industry sales involved in this program.
So why is this important and a threat to Trade Service?
If the quality of the data in the IDW continues to improve and manufacturers continue their commitment to it (which by spending money and allocating personnel shows their commitment), eventually IDEA can realize its goal of being the source for industry content. This endeavor, coupled with IDEA’s data attribution / enrichment initiative with AD, can help further reduce industry operating costs while providing quality data that can be used for ebusiness initiatives.
Presumably Trade Service currently benefits from these manufacturers becoming Platinum with IDEA (improving their data quality) as many manufacturers send data feeds to IDEA and Trade Service. But what if Platinum manufacturers didn’t? What if they told their distributors to get their data from the IDW or direct from the manufacturer, via a download, or the distributor could still subscribe to Trade Service however the data from Trade Service would have to be obtained by Trade Service by a means other than direct from the manufacturer (which reportedly they have done for some manufacturers).
And what if distributors, especially the national chains and larger distributors in the groups (as well as the groups themselves), started making this more of a priority – recognizing manufacturers and distributors that provide / utilize data from the IDW, making it part of their discussions / scorecards, considering it a business tool to reduce operational costs (business transaction errors).
Consider, if Sonepar, Graybar, Rexel / Gexpro, Crescent, CED and USESI, WESCO, Border States, Mayer, Elliott, North Coast, Kirby Risk and McNaughton McKay, to mention a few, made this a business requirement with their top 50-100 manufacturers and, once those companies were Platinum, “unplugged” from Trade Service, would other manufacturers follow pretty quickly?
While small distributors may always be challenged in obtaining “clean data” for a variety of reasons, if the Top 200 distributors (as defined by Electrical Wholesaling), began converting to the IDW, error rates will decline.
And for the small manufacturers? They currently provide data to Trade Service, is there a reason why they can’t to the IDW (and maybe the IDW should consider a more cost-effective initiative for these companies?)
Since data is the key (and everyone likes talking about Grainger being a significant challenge … their core differentiation is their ability to manage data, which they then use to populate their 50+ catalogs, websites and branches while reducing costs – hence increased sales growth and profitability), could the Platinum program be the first step to essentially ending the Trade Service monopoly?
Questions
- Has anyone recently compared the quality of data from the IDW vs. Trade Service’s data?
- Does anyone know what percentage of the units that a distributor carries could be serviced by IDW providers (although one service may have more SKUs than the other, do you / how often have you ordered from those companies or ordered those SKUs)?
Thoughts?
9 Comments
Trade Service does not handle commodities well and refuses to address the issue. Often the data is from one company and is incorrect and does not follow industry UCC guidelines. Yet distributors continue to support Trade Service – it is time for distributors and the marketing groups to put their weight behind this opportunity. The manufacturers are investing in this technology – the Top 200 distributors should also.
IDW HAS BEEN WORKING ON THIS FOR AT LEAST 15 YEARS AND THEY STILL ARE NOT DONE AND NOT EVEN CLOSE TO REPLACING TRADE SERVICE. MANUFACTURERS WOULD HAVE BEEN BETTER OFF INVESTING THERE MONIES INTO TRADE SERVICE. BUYING A PORTION OF THE BUSINESS, A SEAT ON THE BOARD, A VP AND COUPLE DIRECTORS.AND MERGE IDW INTO TRADE SERVICE
IDW has come a long way over the past 5 years. IDEA approaches the challenge of synchronizing data from a collaborative effort. “IDEA provides software and services that help connect the supply chain and make business processes efficient, easy and enjoyable for people every day.”
I have kept tabs as they develop their data and feel that as of last year, they were close to offering enough services to replace Trade Service at our distributorship.
The attributed data is what is drawing me to IDEA, but the incomplete offering of manufacturers standard data has kept me from making the switch.
I look forward to getting updated at NAED Eastern Regional Conference to see if the time is now, to make a switch.
For anonymous #2, you are probably right about the investment in Trade. From their days at i2, trade was a real pain to deal with. That doesn’t mean they weren’t profitable.
From a comparison of data loads, as we are a dual user, it would appear that trade has missed some price updates along with some descriptions that are mind boggling sometimes. Fortunately we work our data in a separate program before loading into our master file.
For those that don’t know about Trade Service’s ‘Supplier Exchange’, it is any thing but free….we spend a lot of time and effort matching contractor files. The story is that Trade furnishes data for contractor estimating systems.I doubt it.
Trade has been around for ever,but a large quantity of some what poor data doesn’t take cost out of our business.They really need to change with the market.
We are one of those Top 200 ED’s. But,I envy Grainger’s website and the data that drives it.
IDEA is making progress with the data we see and use.
We need the same IDEA Platinum “band” data at the contractor level. While we want our inside/outside sales people to engage the contractor, there are other customers that want the ability to place orders. We have that ability currently, but would like automate the order to stock or order from the manufacturer.
Keep up the good work at IDEA.
We are a bit different in that we might use trade data to supplement our IDW data for brands that we don’t get from IDW….maybe.But we don’t use trade data in our operating system. Eventually we’ll stop the trade subscription.
For us there is enough data in IDW for us to operate profitably.
ED from Ohio
Roughly 50-60% of our market is to contractors. For that group,we have narrowed it down to about 150 or so products.We stock a good deal more than we should.
We should look at IDEA.
By the way,thanks to Bob H for passing this along to us.
From Bob H to ED
As I said we are impressed with the IDEA data that we use. We have been approached by Net Pricer relaying the fact that they have struck a deal with IDEA to get certified data down at the contractor level. They promise that they will announce shortly.
We spend a great deal of time with the current data that several of our contractors use.
I think it is worth the time to use one set of data in the same format.
The interesting part of data in the electrical channel is that Trade Service has been around so long, they really don’t listen to what we want. They think they listen, but they don’t change. Someone said that TSC actually add cost to the channel, and we certainly think so.
This IDEA Cert.Data/NetPricer offering could finally bring some sanity to our business with some really larger customers and to our website.
A IL ED
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