The Outlook for Wholesale Distribution in 2012

During the last quarter of 2011, NetSuite conducted a benchmark survey on the state of business within the mid-market wholesale distribution industry.

The exciting news is that the majority of respondents reported significant optimism for growth in the future. More than 69% believe their business will improve in the near term, and almost 99% reported that they believe their business will either improve or remain steady—a dramatic and significant improvement over results of our previous surveys of North American distributors.

For key objectives, 65% of wholesale distributors are focused on both revenue growth and cost savings, with about 28% focused primarily on revenue growth only. That’s a reversal from 2009, when most distributors were focused on cost reductions above all else. Maintaining and increasing revenue growth while watching costs and delighting customers are key priorities for distributors in 2012.

Leaders are striving to boost sales efforts without dramatically increasing costs, and are looking towards technology including ecommerce, cloud computing (SaaS applications), CRM and mobile capabilities for sales to achieve these objectives. 

The survey also reveals a strong focus on improving customer satisfaction, retention and profitability, goals that are further supported by ecommerce and cloud technologies. At the same time, wholesale distribution leaders are looking to improve employee productivity, automate and streamline business processes and reduce overhead to boost overall efficiency.

Wholesale distribution companies want a system that supports all business processes and gives a complete view of what is going on within the business. For that reason, many wholesale distribution businesses are looking at web-based SaaS applications (or cloud computing) as an effective technology for increasing visibility into the business, reducing costs and improving business efficiency.

If you’d like to learn more, I’d encourage you to download the results of the survey.