2020 NAED Western Observations

Last week’s NAED Western, held in Phoenix and attended by approximately 700 people, was a productive event according to many who attended the industry’s first conference of the year.

For many, one of the takeaways was the amount of walking they did!  The lobby to the registration area (and one-on-one section), must have been 1/3^rd of a mile) and going from a meeting at one end of the hotel to another must have been a ½ mile.  According to some, they “got their steps in!”

But, honestly, the hotel has numerous spots for ad hoc meetings (even though many manufacturers had meeting rooms or suites).

From our meetings and discussions with distributors and manufacturers, below are some trends we observed as well as some company-specific input we heard.

Trends

• The sales feedback for the NAED Western region is expectations of low single digit growth with construction higher.  Industrial flat, although there are some projects being quoted / proposed that could significantly alter this forecast, but are location specific.
• In speaking with distributors, more are segmenting their customer base to offer tailored services to audiences, especially larger customers who may be interested in modular construction. Some talked about what we’ll define as “micro-businesses”.  This involves allocating resources to focus on product or end-user market segment niches with dedicated sales and marketing resources.
• A number of companies are investing in web 3.0 … changing their current platform to an upgrade. A number of the larger distributors, and many are AD members, are switching to Insite.
  • At the same time these companies lament that they are not generating much business online and are now re-orienting their expectations that the ROI is based upon omni-service and meeting customer needs.
  • Discussed the definition of eCommerce, or eBusiness / digitalization, ROI with a number of companies.
  • Few feel that Amazon will “take over the industry” or that they are losing significant business to Amazon … and that eCommerce companies that espouse Amazon are somewhat disingenuous or uninformed about the electrical industry and business drivers. Those who think “retail” are misguided.
• Manufacturers reported more distributors contacting them for eCommerce content … and more of it.  More manufacturers are syndicating content to these customers. Some are recognizing this growing trend and the strain it puts on their internal resources (along with the fact that tailoring it to the distributor’s eCommerce system is a challenge. More are talking to DDS about their Syndication I/O services, which also provides DDS more content for subscribing distributors and their Content I/O offering.
• Heard from manufacturers that the IDEA Connector was being delayed.  This was later confirmed in a press release in TEDmag.com.  Unfortunately, this meets an adage that I was told years ago … “every IT project is 3-6 months late and if you can get 80% of your goal within your budget and timeline, take it.  The other 20% doubles the budget and/or lengthens the timeline.” System conversions are never as easy as the vendor says!  Feedback from some manufacturers, albeit smaller companies, was the process “isn’t simple” (but I’m not a techie, so can’t explain “why”.)
• Speaking of technology, a number of distributors and manufacturers inquired re CRM systems.  All asked “is anyone doing well”? And the answer is “no”. All are looking for the system to handle various activities such as sales collaboration to facilitate team selling, account management, data collection (for contact management and marketing), pipeline management as well as facilitate sales management. Spoke to some reps who commented about having 7 logins (that they write down) and that it can be a productivity drain. Some have hired, or allocated, a person for CRM data entry.  With a wide array of CRM systems, much time and effort are invested to tailor a system to a company. Someone who can make this process either easier, or clearer, could prosper.
• Had discussions with a number of distributors inquiring about voice of customer / customer satisfaction initiatives as well as manufacturers inquiring about our Rep360 insights gathering process to gain input on what their reps “really” think of them.
• A number of distributors who have reviewed the NAED white paper called “Building a Connected Business” commented very favorable about it.
• At the 2020 NAED Western General Session, this video on modular building was shared as representative of “an element of the future”.  In talking with someone who works with people in the senior care industry, this is becoming more prevalent.
  • The Keynote speaker talked about innovation and disruption.  Reportedly he was good (worry, had a client meeting to attend
  • Conference sponsors were Eaton, ABB, Legrand, Milbank, Nucor, Zekelman, Siemens and Rab

Unfortunately, didn’t get to any of the breakout sessions. If you did, or you presented at a session, feel free to either post comments or send us thoughts and we’ll post them for readers.

And Tom, thank you for the mention of Channel Marketing Group during your introductory comments.

• We shared a “sneak peek” of the Traits of the Rep of the Future with those we met with. Insights were generated from the work we did for NEMRA on the Rep of the Future report, which will be unveiled this week at NEMRA’s Annual Conference and be available to NEMRA agency and manufacturer members the following week.

Company Specific Input

• A number of distributors commented about the changes, and challenges, at ABB Electrification, specifically around the Thomas & Betts offering.
• Distributors and manufacturers shared that Cooper Lighting Solutions’ entry into AD has had a ripple effect.  AD has advised 5 lighting manufacturers that they will no longer be members of the group.  According to some AD has shared that they want to “focus on conglomerates and Tier 1 lighting manufacturers.” Interestingly, feedback in our latest Pulse of Lighting report highlighted the disparity between conglomerate and non-conglomerate performance; and conglomerates play more in the project market than the renovation market.  Perhaps conglomerates, or “a conglomerate”, strongly “expressed” themselves?
  • We reached out to AD to confirm / ask for a comment as wanted to verify what was heard and AD shared “As matter of policy AD does not comment on specific vendor relationships or decisions.”

As a courtesy to those manufacturers, we won’t share the names, however, if you have confirmed information, feel free to post, even anonymously.

• Bridgeport Fittings endorsed the NEMRA Minimum POS Reporting Standards. Others were presented the standards for consideration.  A number of manufacturers were also introduced to POSConnection, which is designed as a POS data collection highway to streamline the transmission of POS information and can streamline distributor processes and reduce distributor costs.
• A number of distributors and manufacturers inquired about, and shared, thoughts regarding WESCO’s acquisition of Anixter. Most don’t see it as much of an issue for electrical distributors. They see more synergy for WESCO on the utility side of the business and opportunity for datacom / connectivity as well as industrial automation, elements of Anixter’s NSS business and international opportunities. Suppliers, however, recognize that they will be in the cross hairs, especially if there are differing deals. Synergies and opportunities may exist here with negotiations in 2020 and implementation in 2021.

There is more that we heard from individual companies, however, due to implied confidentiality we cannot share that information.

Overall a very productive three days in Phoenix at the NAED Western.  Many meetings. Much walking. Good networking in hallways with a busy lobby and “after hours” lobby.

While the business is, in the words of one, “measured”, there is optimism in the market for a decent year (albeit some election consternation.)

If you attended the 2020 NAED Western, what were your observations? What did you hear?