According to some of the prominent software providers to the OP industry, many dealers aren’t heeding their warnings about the digital commerce challenges that lie ahead. Mobile, use of data and Amazon are just some of the issues, with some independents dragging their heels and refusing to invest in the necessary technology that will help them compete. Those dealers that fail to face up to the harsh e-commerce realities are, they say, endangering the future of their businesses.
Craig Greitzer, VP Sales, Business Management International (BMI)
The core issues haven’t changed over the past few years — Amazon is more prevalent than ever and resellers need to make sure they can compete by providing the best possible e-commerce customer experience. Sadly, many are using websites that operate using old technology and have a dated appearance which will put off many consumers, especially the millennial generation. The same holds true for their mobile e-commerce sites.
Unfortunately, most dealers today aren’t best placed to compete in the digital commerce age — many have fallen behind and are either being acquired or going out of business. This sounds harsh, but you only have to look at the dwindling number of independent dealers to know there is some truth here. Because the industry is hurting, operators are reluctant to invest in technology at exactly the time when they should be doing so.
Amazon represents an existential threat to independent dealers and technology is the only way to level the playing field, using it to ramp up efficiency across their entire operation — in the warehouse, customer service, purchasing and accounting. There’s little they can do about competitive pricing pressures from Amazon, but dealers can improve profitability by being more efficient and doing more with fewer internal resources.
We repeatedly see companies using full-time employees to handle processes that should be automated. BMI can help with the technology and functionality that will do this, eliminating manual workarounds, stopping duplication of data entry and providing timely reporting so they know the current financial status of their operations. Crucially, we can also provide resellers with a modern-looking, highly functional e-commerce site.
Security breaches are another obvious and very serious threat to any business. BMI Software can be deployed on Microsoft Azure which provides a high level of data security.
Moving away from the basic requirements, mobile e-commerce adoption is still too slow among our existing resellers. A few are using our mobile solution, but most haven’t implemented it yet citing a lack of demand from their customers. Yet an increasing number of consumers only want to shop using their mobile devices. It’s an undeniable trend and we are ready to help our resellers when they realise this. We also see weakness in their approach to social media, with most of them needing to up their game in this area.
Across the industry, data isn’t being mined and used as well as it could be. There are some good solutions available from third-party providers and independents need to think more about ways in which they would like to ‘slice and dice’ their data in support of a business strategy. Only then can they mine their data in an effective way.
We have been working on our cloud implementation methodology for SMBs. We recognise the need to bring down the cost of providing services for resellers that don’t require specific customisations and don’t need to implement our full suite of functionality. The end goal is to give smaller-sized dealers big-dealer technology power.
Jennifer Schulman, President, Fortune Web Marketing
One of the issues that I see hampering progress for independent dealers is mobile. Many e-commerce systems are still trying to adapt to become truly responsive platforms. This is crucial from an SEO perspective as Google has moved to its mobile-first index. We’ve seen what this change can mean for a site that is not properly optimised for mobile — essentially it becomes almost impossible for it to appear in search listings.
The second issue is the use of big data and personalisation. I think that dealers and tech providers need to be looking at the data they have collected on buying habits, patterns, spend, etc, and using this to completely personalise a shopping experience. The OP industry is way behind the curve here and buyers expect this type of experience nowadays.
The percentage of dealers that are now setting themselves up properly to compete in the digital commerce age is increasing every month. However, there are still those lagging behind and they are truly missing out. Firstly, as I mentioned, you need a stable, solid platform that takes mobile friendliness, big data and personalisation seriously. Secondly, you need to get people looking at it, browsing, shopping and coming to your site to learn something new.
That’s where a strong digital strategy comes into play, incorporating SEO, social media and basic email marketing as a minimum. With the industry consolidating and major shifts taking place, you have big players stepping up that already understand this approach and have been working on it for some time.
On that consolidation note, what’s happening in the wholesale space with Essendant, SP Richards and, of course, Sycamore Partners, is interesting. There are a lot of factors that need to shake out here before we can see what possible outcomes or ramifications there will be. But what I believe is going to lead the way is technology, through things like Essendant’s digital service programme and the use of big data. Like I said before, we need to use that information more so that dealers can offer a better experience when their customers are shopping online. Both wholesalers can help with this, especially the more technology-minded Essendant.
If we, as a marketing agency, and dealers in general can harness and leverage the technology the wholesalers can bring to the table, it could all work out well for dealers and ultimately position them to compete much more effectively.
I hope we will see a bit more product diversification too. While product innovation has been on the rise in the OP industry, there are items the wholesalers can add that would make the overall catalogue much more marketable.
Finally, of course, the threat from Amazon is huge. We can’t help dealers compete unless they are willing to adopt the relevant technology and create a strong digital presence. Couple that with smart, competitive pricing, ease of ordering, excellent customer service and the ability to handle the needs of the local community, and then we have a plan we can work with and one that can be successful.
Donna Snyder, President & co-owner, GOPD
The main challenge for dealers is identifying and then meeting their customers’ changing preferences for how they shop and order online. Knowing your customers and focusing on their needs and habits is still the key to success. The one-size-fits-all approach does not work, with more and more people demanding a personalised experience online.
Typical buyers today are no longer merely sitting in an office working on a desktop PC, open to a phone call or visit — they are more mobile and need information quickly wherever they are at that time. Consequently, dealers must be able to sell to customers 24/7 using multiple types of devices, with the flexibility to move from one device to another at a moment’s notice.
In addition, marketing must appeal to different types of buyer through the use of smart and competitive pricing.
It’s more important than ever that dealers know and understand the technology available to them and many are now thriving in the B2B arena. They’ve done this by adding new tools and using the systems of software providers to grow their business. By broadening their sales reach, adding new marketing tools like coupons and loyalty points, and using pricing tools smartly, they are finding new opportunities.
One of GOPD’s key focus areas revolves around helping dealers to sell more through multiple shopping carts and to add new products in order to attract new buyers. With our system, dealers can have multiple ‘guest user’ shopping carts with different marketing strategies that will allow them to go out to multiple markets and support different customer needs.
In this way, independents can become a source for more than just basic office products, considerably expanding their reach while minimising the impact on their business.
The key is always to try new things and keep everything appropriately fresh. Mobile is obviously huge, so having a mobile offering that’s compatible with the other tools the dealer offers is vital.
Often buyers start their product research on a mobile device and then move over to a tablet or PC. They must all work seamlessly together and provide buyers with the tools and information they need.
Alex Nicolaides, President, Logicblock
To be quite blunt about it, many resellers are failing to deliver the internet presence and enriched content that consumers are accustomed to. Mobile-ready, customisable, rich product content with fast, flexible searching and 100%-secure pages are must-haves today.
Starting with mobile, dealers are way behind the times with regards to their capabilities. A single site, single experience on any device is the only way to go and with Google now ranking sites based on their mobile-readiness, no other approach will tick all the boxes.
Next, there are products on the market that can analyse consumer data in almost real time, render dynamic content and trigger actions such as emails, based on the customer’s past behaviour or other algorithmic data. Dealers aren’t taking nearly enough advantage of the predictive behavioural data available to them.
Most independents do actually realise these issues and know the options that they have, but they
are dragging their feet and complain. Change isn’t fun, it
hurts, but it’s absolutely necessary in order to survive. Failure to change will be devastating.
The challenges are exacerbated by the failure of some software providers to provide options which would allow independent dealers to keep pace with these fast-changing requirements. The depth and breadth of business-ending security flaws within many industry software solutions is particularly concerning — the continued failure to address these issues will lead to more data breaches, more fines and more business closures.
However, there is hope as more and more progressive independents are moving away from outdated solutions and seeking a technology partner that understands what they need and how to take them to the next level.
There are several external threats too. Amazon and other large retailers certainly represent one. That’s why we offer a competitive pricing rules engine to help dealers compete. Both Amazon and Amazon Business sell many common office supply items, but at premium prices. We offer independents the ability to highlight this inflated pricing to their prospective customers, thus empowering them to make more informed decisions.
The other major issue facing dealers is that Amazon is highly recognisable, whereas many independents are completely invisible on the internet. This is mostly due to unfriendly URLs that are not indexed by Google. We often hear dealers claim they are ‘B2B only’ and that they don’t want to attract random internet shoppers. What they don’t seem to realise is just how many local businesses perform a search for ‘office supplies’ on their phone and then only see Amazon and other big players appear in the listings.
This combination of invisibility, mobile and search engine incompatibility is the perfect storm, but one a provider like Logicblock can fix.
As I’ve already alluded to, the threat of a data breach is huge. In most migrations we’ve done from other systems we’ve uncovered an alarming amount of sensitive data unencrypted and poorly hidden.
Dealers have two choices — compliance with best security practices or culpability for neglect. They have to be able to rely on their software providers to do this for them. At the end of the day, security breaches will, at best, badly affect their reputation.
Charles Russell, co-owner, SSI
In general, dealers do not focus on e-commerce as much as they need to. They have to be well-versed in digital marketing and SEO, looking at factors such as abandoned carts, and ranking and marketing the products that they prefer to sell. The problem is that, at most dealerships, no one owns these tasks and that’s where a provider such as SSI can help.
The importance of mobile is still not getting through to some dealers. What many don’t understand is that even if customers are still placing orders from their desktops, a lot of them are trying to research those orders on their phones first. And if dealers’ current sites are not suited to this, they are getting a poor experience. Our e-commerce products mean end users can place orders from any device, without the need to download an app, something customers may not be willing to do, especially if they are just browsing a dealer’s offerings.
Amazon, of course, has the marketing resources and technology that gives it an advantage over independent dealers. But its pricing is often high compared to most dealers due to shipping costs. Independents should be showing Amazon’s prices on their websites and highlighting that they will beat those prices. They also need to focus on marketing those items that make them the most margin and ensuring these items attain high rankings in customer searches.
This last point has been one of our key areas of focus over the past year. Our web store is now fully customisable, so that dealers can control the look and feel of their sites. In addition, we’ve made it easier for them to push the items that are most profitable for them through search ranking and merchandising tools.
Regardless of who ultimately acquires Essendant, all dealers need to be looking at how they buy product — not just what items they stock, but how they distribute them. If the merger with SP Richards does go ahead, dealers will be left with one national wholesaler. As a result, they will find themselves having to stock more products and changing their distribution processes.
No one really knows Sycamore Partners’ plans at this point. If the private equity firm, which already owns Staples, buys Essendant, will it fold the two together? Or will it try to operate the two separately?
How many independent dealers are going to want to buy from the wholesaler and, when it comes to things like wrap-and-label, share their customer information with an operator that’s tied to Staples?
The bottom line is that dealers have to focus more on technology and create more efficient purchasing, inventory management and distribution today, so they can be ready for tomorrow.
Flexibility is key
From a technology perspective, the more flexible the software, the better positioned independents are. Dealers that tie their software too closely to a single wholesaler’s model may be at a disadvantage. But, that aside, every dealer has some important questions to answer. Will they be able to do business with the new entity — whatever it may look like? Will pricing changes make them less competitive?
For now certainly, there are more questions than answers. Being prepared for all eventualities is key.
Technology solutions and software programs vary from provider to provider. Here’s a small selection of what’s on offer.
GOPD’s OP-24/7 Shopping Cart system was designed specifically for office products dealers. The company has been working closely with dealers and wholesalers since 2005 to develop a user-friendly cart, designed to provide shoppers with the tools they need to research, browse and buy products quickly and easily. The system also helps dealers automate their business with extensive back-office functions tailored to fit their specific requirements.
GOPD continuously adds new functionality to the system, and flexibility in the program means dealers can pick and choose what works best for their business. Recent features include the ability to fully customise the shopping cart, EPIC interface for national accounts, customer PunchOut capability and a mobile-friendly cart version. In addition, the system offers an interface to accounting systems such as QuickBooks or NetSuite.
Find out more: www.gopd.com
BMI Software is designed for progressive independent dealers seeking to provide their customers with a superior online shopping experience. It offers a modern back-office business management system aimed at increasing productivity and efficiency in customer service, purchasing, warehouse management, accounting and financial reporting.
The package was first launched in 2006 and underwent a significant update to both the e-commerce site and back-office software in 2016. Features include a Microsoft-based user interface, extensive access to system data, and integration with other Microsoft products such as Outlook and Excel.
Users are able to create e-commerce marketing pages and links, without code. All marketing page data is controlled through the back-office software. The system’s fully-integrated accounting functionality means that no third-party software, such as Quickbooks, is required. Real-time financial statements are available on demand.
Find out more: www.bmiusa.com
SSI has two software packages aimed at the North American office products industry — SSIop and SSIweb. Both programs have been on the market for about eight years, but have been continuously updated to provide the features required to keep dealers competitive.
SSIop is a dealer business system — a complete solution for managing the back office efficiently. This graphical software package provides OP dealers with an efficient business flow and runs on a modern, open-source platform. It interfaces with marketing and business analysis tools such as Remarkety, ZOHO reports, Zapier, Sugar CRM and BPM Online.
SSIweb is a B2B web store that dealers can use independently or alongside the business system. It is SEO-optimised and has the features to help dealers compete with the big e-commerce sites, together with the tools to help them sell the products that make them the most profit. It also has a responsive design so it’s compatible with mobile devices.
Find out more: www.ssiop.com
The Logicblock eCommerce platform was first launched in 2007, but has undergone significant updates since then. The software aims to remove the restrictions that prevent online dealers from growing in a rapidly-changing technological landscape. It provides a full website and e-commerce cloud-based solution that integrates with the largest wholesale distributors over a range of different sectors, including the OP, industrial, educational and safety categories.
Logicblock’s user interface incorporates an SEO-friendly, mobile-ready storefront that is considered to be a B2X (ie B2B and B2C) solution since it can be tailored to work with any type of online shopper.
The back-end solution transmits orders electronically using two-way communication paths for processing orders, shipping and product inventory, and has the flexibility to integrate with other software solutions.
Find out more: www.logicblock.com
Fortune Web Marketing
Fortune Web Marketing is an online marketing services agency that works closely with many software providers in the office products industry. Founded in 2008, its areas of expertise include search engine marketing, web design, social media, email marketing, content marketing and strategic consulting.
The company’s strategies constantly adapt to the changing OP industry landscape and the ever-evolving world of online marketing. They are driven by the latest trends in SEO and social media, together with the continuing technological shifts by giants such as Google and Facebook.
Fortune Web Marketing’s core aim is to drive brand awareness, leads and online sales, but it also covers everything from print to web design and branding. The company primarily caters for small to medium-sized businesses, in the traditional OP as well as the office furniture and jan/san sectors.
Find out more: www.fortunewebmarketing.com