Wholesalers have to get creative to make it through COVID-19 pandemic
Everything went out the window for wholesalers when COVID-19 hit. What used to work, all of a sudden changed for the distribution channel, as inventory shortages became an all too real issue for the industry.
But wholesalers rebounded. New solutions were made for problems that started during the pandemic, “COVID equals creativity,” explains Joe Senese, vice president of operations for Groupe Deschenes. “It forced us to look at even the most simplistic elements of our business and required them to be reengineered (like customers coming to counters to pick up material). Probably the simplest form of wholesale service value that’s out there today. Once customers were not allowed to enter premises, it forced pretty creative response to how we were going to be able to still provide products and keep the supply chain going because the contractor network is an essential service.”
Groupe Deschenes is the parent company of several subsidiary companies which operate across Canada including, Bardon, Boone, Centrix, Descair, Deschênes Montreal, Deschênes Quebec, Desco, Flocor, Huot, Iconix, and Ideal Supply.
To get to the final transaction between a contractor and wholesaler, there is a whole chain of events that need to happen. It’s in each of those steps that Senese says there needs to be a level of creativity for solutions.
“This pandemic has brought us a set of totally unexpected challenges that no one could have envisioned. It has unquestionably changed our way of doing business, from supply chain to network operations and to the ways we provide service and value to our customers,” says Neil McDougall, president of Master Distribution. “It has forced us to see things from a different perspective and to ensure we adjusted to our customers’ needs while following all the appropriate government instructions for health and safety protocols.”
Contractors have embraced curbside pickup. “I think customers appreciate the opportunity to place advanced orders and have the ability to just drive up and have it delivered to their vehicle as opposed to a location,” explains Rita Woodley, regional manager for the greater Toronto area at Noble. “It’s a lot faster service for them with regards to turnaround. I think curbside pickup is going to stay.”
Across the country, each province has been affected by the pandemic differently, “The changes were felt mostly in the eastern part of the country, which was hardest hit by the pandemic, particularly in Quebec, and in Ontario, where construction sites were closed at the request of the provincial governments,” says McDougall.
“The implementation of safety measures and the closure of construction sites also had a drastic effect on demand during the first couple of months of the pandemic.”
For those that operate businesses across Canada, this made planning a bit trickier. “Unfortunately for us, we operate national across the country, each province, on top of what the federal government was doing, put in their own control mechanisms such as with commercial construction sites, some were closed, some were open, and some had limited capacity. That complicated matters,” says Senese. “We certainly tried to take a more provincial approach to how and what we have to do to meet the needs of our customers right across Canada.”
In addition, forecasting basically went out the window, says Yves Bélanger, vice president of supply chain at Wolseley Canada Inc. “Not knowing the future demand and having an abrupt decrease in sales, we had to change our ordering to adapt to the current reality.” After the dip in demand, there was an abrupt reintroduction of says demand due largely to construction sites being reopened.
Level of transparency
Communication amongst all levels of the distribution channel needed to be increased. “We thought communication was important before, it has exponentially become something that needs to be at the core of everything we do both internally and for customer and supplier contact,” says Senese. This includes communication between subsidiary companies which allowed them to share best practices.
When COVID-19 first hit, in many ways, wholesalers went into survival mode, attempting to find the best way to conduct business while ensuring the safety of their employees and customers.
Safety remains to be of top concern for wholesalers and contractors. “Everyone has been affected by this crisis and of course contractors are no exception. The majority of them tell us that the greatest challenges they currently face are mainly related to the health and safety requirements of their employees and the continuity of business as the pandemic is prolonged,” says McDougall.
In terms of inventory shortages, contractors were happy to get product no matter or not if it was something they were familiar with. Not all wholesalers had their inventory take a hit. According to Woodley, Noble’s inventory was fully loaded prior to COVID-19.
While the industry can only guess what the future will hold, they appear to be optimistic. Others aren’t so sure, “Once this subsides in a couple of years, I think a lot of new habits will have formed and it will never go back,” says Bélanger. Still, some believe that there is still a chance for things to go back to normal, with an asterisk, “Nobody knows exactly what’s coming, but I think we’re at a stage now where we can see the trends around still requiring our traditional services but requiring the new digital technology services as an add on,” says Senese.
Everyone is still doing their part to make sure that the industry can survive the pandemic. “Everybody’s been respectful and doing their part in order to keep the economy going. We’re doing our part with regards to delivery,” says Woodley.
What everyone needs to remember is that nothing can be taken for granted, and any company must set itself up to adapt to changing realities, suggests McDougall. “Even though the pandemic imposed physical distancing, it in return allowed us to get closer to our customers by being more attentive to their needs and adapting our services to their new reality.”