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In today’s world, things can change in an instant. One walk-in order at the sales counter could turn into a lucrative partnership that drastically increases your profits. Likewise, a competitor could swoop in and offer one of your most profitable customers a more compelling price on a hose assembly causing you to lose their business.
Now, more than ever, you need to have your finger on the pulse of your business in order to adapt and remain competitive in the industrial distribution marketplace. You need to not only be keeping up with industry trends and have a solid grasp of how you’re doing, but also understand how you stack up to similar companies in your industry. Doing so will allow you to benchmark your distribution business against your competitors, watch your company's performance over time, establish triggers for scaling, and quantify where you're going.
Below, we outlined three simple steps to help industrial distributors benchmark and track growth and success.
In order to be able to gauge how you’re doing and set yourself up for growth, you need to first establish some industry benchmarks. These benchmarks will serve as reference points that you can use to compare your performance against other likeminded companies. To start, ask yourself:
Many trade associations share industry reports that can help you set industry benchmarks against your peers and stay on top of industry trends and forecasts. To gain the insight needed to answer the questions above, you may want to check out some of the following sources:
Once you have a clear understanding of your industry benchmarks, you’ll then want to determine which metrics, or key performance indicators (KPIs) will help you reach your goals of meeting and exceeding them. While some KPIs may be more or less valuable to certain distributors, some common KPIs that every industrial distributor will want to keep track of include:
Performance Results
Critical Profit Variables
Now that you know which metrics are most valuable to your business, you’ll need a way to measure and track these KPIs over time. The best business management solutions for distributors should come with a wide variety of tools that provide immediate, real-time insight into your business performance.
TrulinX software by Tribute, Inc., can help you determine the state of your business with a number of real-time performance tracking tools and reports to give you the relevant information you need. From sales bookings and inventory positions to vendor report cards and special pricing agreements (SPAs), you’ll get a real-time snapshot of your business that you can easily compare to previous days, months, and years.
TrulinX helps you measure these Critical Profit Variables:
Additional KPIs that can be tracked in TrulinX:
Monitor other important Business Management Metrics in TrulinX:
Now is the time to analyze your distribution business and its position in the marketplace to determine the steps needed to make it more competitive and profitable. From increasing gross margins and inventory turnover to decreasing operating expenses, TrulinX can give you the tools you need to improve and track your performance, while ensuring you are profitable and responsive in this tough market.
To learn more about Tribute's industry expertise and how TrulinX software can benefit your organization, request a demo today.
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