On Friday, Oct. 19, during Manufacturing Appreciation Week in the Commonwealth, the Virginia Manufacturers Association (VMA) held its 2012 Virginia Industry Leadership Forum. This annual event brings leaders of industry and the Commonwealth together to raise the profile of manufacturing and discuss solutions to keep Virginia industry a global competitor. The event continued its tradition of world-class speakers and presentations from various leaders within the manufacturing industry. Among the speakers was Dr. Andrew Thomas, author of "The Distribution Trap: Keeping Your Innovations from Becoming Commodities."
Referencing the research that was the foundation of his book, Thomas discussed how to keep product innovations from becoming volume-driven commodities. He spoke on the risks and rewards facing manufacturers in the choice of their product distribution and sales models. He used STIHL, Inc. as an example of a company that has enjoyed tremendous success by adhering to its servicing-dealer-only distribution strategy that keeps them from becoming a slave to box store margin demands.
Thomas’ appearance was made possible by event sponsor STIHL. Fred Whyte, president of STIHL, began the session with an introductory speech on how the company’s approach to sales and distribution, with a focus on independent dealers and small businesses rather than big box” retailing, offers a successful alternative to the mass merchant model.
Bill Brunelle of Independent We Stand, a movement that promotes the benefits of buying from independent local businesses, attended the event and had high praise for the presentation. “Dr. Thomas and Mr. Whyte illustrated how businesses can lose brand integrity and product quality by distributing through mass merchants. By selling through local servicing dealers, STIHL is not only protecting its brand, but supporting thousands of local businesses that provide jobs and economic resources for communities.”