Tag Archives: #distribution

Consolidating Distribution

Insiderlogo3The Ongoing Consolidation Trend in Distribution
E+H Appoints TriNova in Upstate New York and New England

When your editor first began working as a sales engineer in the automation industry, distribution in North America was defined by the Dodge marketing territories.

These were county-by-county (later modified to be zipcode-based) distribution and representation maps, published by the F. W. Dodge Company. Every automation company representation contract used these territories. There was the “Northern California Territory” for example, which included the counties of Western Nevada, but not Clark County (home of Las Vegas and the military bases).

These territories were most often “exclusive” meaning that only one company had distribution rights in that territory for those products.

These territories have become more and more irrelevant. There are several reasons for this.

First, the economics of the small, family-operated, one- or two- person rep firm, or distribution company decayed. It now costs approximately $500 to make a single sales call. The traditional “eight calls a day” sales methodology simply stopped working.

Second, the generational shift left many second- or third- generation rep/distributor owners looking for exit strategies because they didn’t really want to work in the family business, or couldn’t make a living at it any longer.

Third, the better capitalized rep and distributor firms started expansion plans that focused on either buying a small rep or distributor in a new territory or simply bypassing existing distribution and starting up an entirely new enterprise, and soliciting crossover from their existing principals.
Endress+Hauser has been working with this level of consolidation since the early 2000s. At one point, they even purchased a representative firm which was in financial distress, and kept it running. Now, they’ve done it again, in New England and Upstate New York.

Fourth, the explosion of electronic commerce has made other options than buying from a local rep or distributor possible.

TriNova Inc. is a long-time representative and business partner of Endress+Hauser, and is 50 years old as a company. The company is the automation supplier’s Sales Representative and Authorized Service Provider in the southeast and has now expanded its operations in New England and Upstate New York from new offices in Ballston Spa, NY.

The two companies have spent the last three months preparing for a smooth transition by staffing the new office and training personnel. Teams have been established and are ready to provide customers in the new territory dedicated support and services in all markets and industries.

“We are pleased to have the opportunity to expand our partnership with TriNova in the New England and Upstate New York region,” said Chris English, Vice President of Sales, Endress+Hauser.

And, just as this issue is going to press, E+H announced that they were partnering with their rep and service provider in Oklahoma, Vector Controls to put together a consortium to work in the oil field industry, with partnerships with Angus Measurement Services, TechnipFMC and its Authorized Service Provider, Vector Controls. The automation companies will collaborate to bring added value to the oil and gas industry, assisting customers with transition to the digital oilfield. The partnership alignment between the automation companies is to inform and better prepare the oil and gas industry and customers for Industry 4.0. The oil and gas industry has played a pivotal role in the economic transformation of the world. Today the industry can set new parameters and direction through digitalization.

If you liked this content, there’s much more where it came from. This story was originally published in the December 2017 Industrial Automation and Process Control INSIDER. You can subscribe by visiting http://www.spitzerandboyes.com/insider.