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How suppliers and distributors kept their cool – and their clients – in the face of cut-to-the-bone client budgets, greater industry competition, an uncertain economy and a national tragedy.
By Michele Bell and Cynthia L. Ironson

Focus, Focus, Focus!
You’ve got to feel some sympathy for suppliers. They’re the ones continually being asked to cut prices, exhibit at more shows, develop better, more innovative products, manufacture and deliver them an hour after the order is placed – and do it all for under a dollar, please?
How do they do it? Two words: resiliency and ingenuity. They don’t take turmoil lying down, and complacency isn’t the key to their success. They rose to the unique challenges they faced in 2001 and proved that when the going gets tough, the suppliers in this industry truly get going.
Like industry suppliers, distributors weren’t passive when reacting to adversity in 2001. From a decrease in their number of clients to the economic shake-out of our mini-recession and the dot.com debacle to the societal upheaval after 9/11, distributors were proactive in a variety of ways to counteract a dip in sales and account activity.
Overwhelmingly, distributors realized that instead of wasting their precious resources on finding new business, they needed to hone in on existing accounts, dazzle them with service and presentation, and mine them for even more business.
A Look At The Supplier Side
First, the basics: The average number of clients that suppliers serve is on the rise. Suppliers reported doing business with an average of 1,183 distributors in 2001 (the median number was 331). Those numbers represent a sizable increase over last year’s figures, which were 870 and 200 respectively.
The largest number of suppliers (31%) said their average client had a sales volume of “up to $500,000.” That’s logical, since the vast number of industry distributors are in that smallest sales volume category. But the big spenders were (naturally) the larger distributors: When asked about the approximate size of the average distributor who spent the most money with them, the largest group of supplier respondents (28%) chose the $1 million to $5 million category.

Paying Attention To Retention
We also asked suppliers if they took any measures beyond their normal efforts to retain customers in 2001. Though the majority (58%) of suppliers said yes, we found it surprising that one-third said no.
And what did suppliers do to retain clients? Among those who took measures beyond their usual efforts, the largest group (65%) offered special pricing/sales. More than half (53%) said they advertise their company more, and nearly half (48%) called on distributors more often.
“The economy impacted our marketing efforts in two ways,” says Michael Bernstein, corporate vice president of Counselor Top 40 supplier Leed’s (asi/66887). “First, we reduced and/or eliminated any non-core or unessential marketing efforts, [which] included advertising in publications that were minimally impactful or reducing our exposure at mediocre shows. Second, we redirected many of these savings into increasing our presence in marketing areas where the payback was significant. Thus, our booth size at key national shows was actually expanded, not reduced. Similarly, we increased the number of direct marketing pieces that we produce and send directly to our customer base.”
Bernstein also points out that Leed’s saw its active customer base increase by 20%, primarily through more direct marketing, telemarketing and the company’s sales force focusing on a broader account base.
In regards to the survey, did the extra effort pay off? Supplier responses don’t offer a clear answer. Of those who reported a sales volume increase in 2001, 57% took extra measures to retain clients, while 43% did not. But here’s the complicating factor: Of those suppliers who reported a sales volume decrease last year, a full two-thirds (66%) said they also took extra measures to keep clients, while 34% did not. It seems to fly in the face of logic. Could it be that sales volume decreases might have been even larger if suppliers didn’t make the extra effort?
A number of suppliers attempted to retain clients by improving their production and processing capabilities. Some suppliers (16%) took steps to improve their accuracy through things like quality control, better training, follow-up calls, streamlined procedures, more contractors, software, tracking and better shipping. A larger number of respondents (33%) tried to retain clients by reducing lead times by adding machinery, better stock, increased productivity, new processes, increased efficiency, increased labor and other means.
Survey Says …
This year we asked suppliers to rate statements made about the buying practices and promotional planning capability of distributors and end-users.
In general, suppliers were most likely to agree with the statement, “distributors shop for products primarily based on price.” At the opposite end of the spectrum, most disagreed with the statement, “distributors and their clients are doing a good job of planning ahead for their promotional needs.”
Feedback: When asked if it’s possible for suppliers and distributors to work together in some way to encourage end-users to better plan for their promotional needs, Wendy Simons, vice president of marketing for IMC (asi/62820), says it’s not only possible, it’s critical – particularly for a company like IMC that specializes in overseas custom merchandise.
“As a company that prides itself on developing custom product solutions, we need time to come up with creative product ideas and work with our overseas offices in Asia to produce the highest-quality products that fall within the end-user’s budget,” Simons says. “In addition, there’s usually a 60 to 90 day lead time for production. The more time we have to plan and produce, the better the products are for the end-user.”
Teflon In A Volatile Economy
Not only did suppliers do business with more clients in 2001, they also got more new business. Suppliers reported an average of 266 new clients (median: 90). Again, this was considerably higher than 2000’s average of 186 new clients (median: 55).
Where did this new business come from? More than 60% of our supplier respondents cited trade shows as the primary source. However, that number was down slightly from 62% of respondents last year. Interestingly enough, last year’s second most popular source of new business – direct mail – was displaced this year by “placement in industry listing services and/or research products (44%).” Last year that option finished in third place with 33%, indicating it may be gaining favor as a marketing tactic. But even in third place, “direct mail” garnered a slightly higher share of responses this year.
“We’ve been successful in reaching distributors and increasing our customer base, primarily due to trade show contacts and the fact that not only are we participating in the larger national and regional shows, [we’re] also exhibiting with the table top showcases,” says Monique Favreau, director of marketing for Digispec/Counterpoint (asi/49716). “This has allowed us to visit and develop relationships with distributors that we wouldn’t reach otherwise, because they don’t really travel out of their areas.”
It doesn’t seem like suppliers are flocking to other industries to find new business, though. Fewer suppliers reported doing business in channels other than the
promotional products industry (42% vs. 49% last year). But of those who did sell through alternate channels, the top three slots remained the same: 1) “retail,” 2)
“separate division” and 3) “Internet.”
“It takes a lot of stamina and time for a supplier to become established in more than one industry,” says David Stacks, marketing director for Augusta Sportswear (asi/37461). “Sometimes it’s best to follow Warren Buffet’s advice: Invest your time and money in what you know. Leave what you don’t know to others.”
Bernstein points out that in tough economic times, companies tend to refocus on their core channels. “Many suppliers, Leed’s included, initiated new channel expansion efforts over the past few years, which can take three to five years to be profitable. In a downturn, you have to eliminate nonessential activities to maintain and/or grow your core market share,” he says.
Deborah Mann, director of marketing and promotions for A La Carte (asi/30350), maintains that the promotional products industry has expanded exponentially in terms of dollar volume, yet continues to be an industry that is special in that the dollars are driven by huge companies with sophisticated sales forces and marketing techniques, as well as small companies that take a personal, hands-on approach to servicing clients.
“As a supplier, I am constantly challenged to find a way to satisfy my distributors who are at both ends of the spectrum in addition to those that fall in the middle,” Mann says. “We offer customized, made- to-order food packaging and decorating with very low minimums. If I were to sell to the retail industry, I would have to make major adjustments in the way I produce orders, price products and distribute them. We’re more focused on finding ways to expand the food product category in our chosen market – promotional products.”
Competition From Within
What forms of competition kept suppliers busy in 2001? The largest portion (29%) pointed to “other industry suppliers in my own product category” as the most significant competitive challenge. Although this was also the most popular answer in 2000, it was down 6 percentage points.
This year suppliers were a little bit more worried about “industry suppliers expanding their lines to include products similar to mine” (15%), which may reflect a supplier diversification trend. Only 10% of suppliers selected this as a concern in last year’s SOI.
The survey found there’s good reason to be concerned: Adding new product categories is by far the most significant way suppliers are diversifying their businesses these days, with more than half of respondents adding new product categories in 2001.
Bernstein acknowledges that Leed’s used selective price breaks effectively in 2001, and also offered sizable price breaks in 2002 due to China’s entrance into the World Trade Organization and the corresponding savings Leed’s was able to generate in its sourcing efforts.
And although the last few SOI surveys haven’t lent much credence to an importing trend in the industry, “distributors sourcing products overseas” furrowed more brows in 2001, with a 14% response rate, up from 12% in 2000.
The sources of potential competition that weren’t a big concern to suppliers included “supplier web sites,” “industry suppliers selling blanks,” “distributors not familiar with services,” “industry suppliers with same price points,” and “major discount chains.” Supplier Web sites seems to inspire less concern as time goes by. In 1999, a full 20% of supplier respondents listed it as a concern.
Doing More With Less
No surprise: Suppliers are mainly focusing their marketing efforts on products and customers in 2002, according to our survey. A full 55% of suppliers said they intend to expand current product lines or add new ones, while 53% intend to expand their number of distributor customers. These two options were far ahead of other strategies, which included “establish and/or build an Internet presence” (30%) and “improve response times” (23%).
“We reconsidered how we planned to spend each dollar,” Stacks says. “But in the end, we didn’t make any cuts to our overall marketing budget. In fact, we ended up spending more than the previous year. However, we did shift some money from trade advertising to trade shows. We
decided not to return in 2002 to one of our most expensive trade shows in another market. We spent some dollars to upgrade our web site so customers would have an additional channel for getting product information and placing orders. And we debuted Augusta Sportswear’s first-ever outerwear catalog.”
What’s interesting is that supplier marketing strategies don’t seem to change much year-to-year. For 2001, the top strategies were the same – except more suppliers wanted to expand their customer base rather than expand their product offerings.
“We have two key marketing tactics for 2002,” Bernstein explains. “In the past two years we’ve all seen the largest distributors drain a disproportionate amount of sales and marketing resources without returning that investment in new business growth.
[Because of that], we’ve realigned our efforts around those distributors, both large and small, who provide a real return on our investment. Second, we’ve
expanded our product line – and will continue to do so – as a means of capturing a greater share of spending. This expansion fits comfortably within our current product range and is a natural extension of both our sales and, most important, our sourcing strengths.”

Catch-22 Conundrum
There’s one marketing strategy, however, that suppliers may need to change – trade show exhibiting. New industry shows, new locations, new related-industry and end-user events – there’s no question that suppliers and distributors are faced with an increasingly active, year-round trade show schedule.
“Shows are important to us, and we use different types to achieve different things,” Mann says. “We exhibit at national shows, regional shows, tabletop shows, end-user shows, traveling showcases and distributor sponsored shows. The larger shows are great for introducing new items, touching base with clients and showing the line in general; smaller shows allow us the opportunity to spend more time explaining the line, showing our capabilities and educating the distributor.” End-user shows, Mann notes, give her company a chance to get its products into the hands of the buyer and impart their knowledge to them directly. “Since we adjust our sales approach and product sampling for each type of show, we have found each type to be effective and profitable in its own way,” she says.
With more tradeshows than ever, suppliers are caught in the ultimate Catch-22 conundrum: Should they attend all or most of them and dice their marketing budget, manpower and resources into even smaller sections, or should they not attend and risk the competition getting a leg up on their business? As many suppliers lament: Like it or not, you can’t afford not to be there.
For the first time, the 2002 State of the Industry survey gathered figures about trade show participation from both suppliers and distributors. In general, suppliers say they favor exhibiting at regional trade shows. And they exhibited at virtually the same number of national industry shows as ancillary-industry shows in 2001. Traveling shows also seem to be a popular option – 60% of suppliers say they participate in them. In 2001, suppliers exhibited at an average of:
- 2 end-user shows
- 3 individual distributor shows
- 3 national promotional product shows
- 5 regional shows
- 3 ancillary-industry shows.
The two most popular ancillary-industry shows that suppliers exhibited at were Premium/incentive shows and gift/toy shows.
These types of shows also drew the most supplier attendance, along with general merchandise/variety shows.
To summarize, the average supplier exhibited at slightly more than 15 shows during 2001 – more than one per month. Given that exhibiting requires a considerable commitment of time and resources, why exhibit at so many shows?
“Our presence as exhibitors at key trade shows is the most cost-effective way for us to generate sales leads,” Stacks maintains. “For example, a sales rep at a five-hour Discovery Marketing tabletop show can see an average of 60 potential
buyers. That’s more contacts than the same rep could make in four weeks on the road.”
The number one reason suppliers gave for exhibiting: “educate distributors about my products” (61%), followed closely by “distribute catalogs” (56%) and “network with distributors” (55%). When cross-tabulating supplier sales volume with their reasons for exhibiting at trade shows, we find larger suppliers tend to place more emphasis on networking with distributors and less on distributing catalogs.
“Our trade show participation runs the gamut from national, regional and table top showcase shows to participating in our customer’s rep conferences and end-user shows,” Favreau says. “What we’ve found is that an opportunity to meet with customers face-to-face is time and money well spent. The jury is still out on end-user shows, not because we don’t feel there isn’t value, but because some distributors don’t really keep track of the items their customers show interest in and capitalize on those opportunities. There are, however, those distributors who are extremely organized and make the most of those contacts, [and] those are the end-user shows we continue to participate in.”
If one of the main reasons suppliers exhibit at trade shows is to ultimately increase sales, our survey found that, surprisingly, a full 41% of suppliers don’t know how many leads they gathered at trade shows in 2001. Suppliers who did track the leads they generated (44%) had an average of 1,726 and a median of 1,000 leads from exhibiting that year. Even more telling, the majority of suppliers (58%) didn’t know what percentage of the leads they gathered were successfully converted to sales. The question begs asking: How do suppliers determine whether a show is a profitable investment for them without tracking leads?
“We absolutely track our trade show contacts and are focused on making the most of our trade show investment,” Favreau says. “Although our main goal at shows is strengthening our relationships with existing customers, equally important is our post-show contact with the existing customers and newly made contacts. It’s the exception rather than the rule that you would close business at a show. So it’s follow-up, follow-up and follow-up again so distributors aren’t only aware of who you are, but are actively presenting and selling your products to their end-user customer base.”

And On The Distributor Side …
How were things for distributors last year as they pertain to markets and marketing? For one, client retention rates declined, probably as a result of the recession. Distributors reported serving an average of 784 client accounts in 2001 (median: 120). Still, a full 80% of respondents
reported retaining more than three-fourths of their clients.
“Our sales were almost identical to last year, within several thousand dollars, [but] our profitability was up considerably,” says Pete Gleason, MAS, president of Gleason Promotional Marketing (asi/208264), who also notes that because his company served fewer clients – many of which the distributor weeded out himself – they’re now able to spend more time developing existing, quality clients. “Due to budget cuts, some of our clients have slowed down tremendously, but we have not lost them,” Gleason says. “[However] we have stopped calling on some of the clients that we feel don’t fit within our long term growth objectives.”
Kayla Tollen, MAS, president of Kayla Advertising (asi/239482), says that while her sales volume increased so did the amount of clients she serviced from 2000 to 2001. She’s been able to retain clients despite uncertain economic conditions because, as she says, “[I] pay attention to their needs, I’m respectful of their time, and provide excellent customer service.”
Nearly two-thirds of distributors (64%) said they took additional measures to retain their current customers in 2001, while roughly one-third did not. Distributors who made the extra effort:
- called on clients (71%)
- offered special pricing/sales (58%)
- spent more time helping clients with their promotional efforts (46%).
The payoff wasn’t palpable to most respondents: Forty-two percent felt their efforts were essentially unsuccessful, outnumbering those that believed their efforts were “somewhat” or “very” successful (34%).
“As near as we can tell, we didn’t lose any clients – our average order was simply smaller ... by about 15%,” says Bert Williams, MAS, president of Williams Associates Ltd. (asi/360450). “I think it was a function of the larger clients – who have large average orders – retreating in their buying habits.”
Client retention rates may have declined, but just the opposite is true for the number of new clients distributors serviced in 2001. Distributors added an average of 54 new clients last year (median: 20). That number is a dramatic increase over last year’s average of 33 and only nine the year before. Yet this year’s median number of new clients (20) was the same as in last year’s State of the Industry report, suggesting that larger distributors were more likely than smaller ones to gain new clients during 2001.

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DR. COOPER’S SOI NOTEBOOK
New Markets, New Clients
The largest group of distributors whose sales volumes increased in 2001 attributed that growth to a bigger client base and expansion into new markets. We know from other research that nearly everyone already uses promotional products. (The estimate is about 98% to 99% of all organizations.) Therefore, if a distributorship is to increase its client base and/or expand into new markets, those new customers will most likely come from someone else’s customer base.
Admittedly, there are some advantages to this approach. These customers are often already convinced of the importance of promotional products. And, presumably, these experienced clients know something about the industry, making them more knowledgeable buyers.
Conversely, we know it costs five to 10 times as much to recruit new clients as it does to keep those you already have. What is the impact on profitability when distributors focus on competing for new clients rather than on expanding the range of uses for promotional products among current clients? What would the bottom-line impact be if you reduced customer attrition and focused on cross-selling new programs to existing clients?
But wait! When we asked distributors about their top market strategy for 2002, only slightly more than half (57%) said they’ll be focusing their resources on increasing business from a select number of clients. Could it be that more than 40% of distributors still don’t know the financial advantages of the new customer/existing customer equation? Is it possible that, because of ingrained habits, some distributors still find it easier and more natural to try to win over new clients rather than doing more business with their existing base? Or is it that distributors prefer to spread their sales volume across more clients, thereby limiting the impact of any one client’s potential defection?
Whoever distributors are doing business with, one thing’s clear: Along with other marketing and customer-oriented initiatives (e.g., sales force automation, advertising, CRM, sponsorships), clients are increasingly requesting evidence that promotional products pay their own way.
For example, nearly one-third of distributors “somewhat” or “strongly” agreed that “clients want proof of return-on-investment.”
And 30.% of respondents selected “how to justify their purchase of promotional products based on results” as the biggest problem being faced by their clients that distributors need to help them address. Furthermore, the second most oft-cited problem for distributors and clients was “how to measure the results of using promotional products.”
Taken together, these problems were mentioned by more than half of all respondents, and they’re really two sides of the same coin. Justifying the use of promotional products based on results necessarily mandates being able to measure those results.
Although not all clients are asking for accountability right now, the trend is definitely in that direction. Nevertheless, a mere 6% of distributors actually say they’re currently offering “results/ROI tracking/analysis” to their clients. Those who haven’t yet felt pressured by clients to track results are likely to feel that pressure mounting in the near future. |
Market And Spending Shifts
Clients may be re-prioritizing their promotional products spending. Each year, we ask distributors to name the top three purposes for which their clients bought promotional products. In 2001 (as in previous years), end-users were most likely to buy them as business gifts – more than half (52%) of distributors surveyed chose that answer.
“We’re seeing two trends with our clients,” Gleason says. “Many are reducing item cost to stretch their budgets
further; others are actually increasing their spending, but focusing on a smaller target group.”
But this year event marketing threatened first place. In fact, buying products for events was chosen by 51% of our respondents, almost as many as those citing “business gifts.” The good news is that event marketing certainly seems to be rising in importance – last year it was selected by just 38% of distributor respondents. The bad news is that if you don’t get moving, your competitors may shut you out of this burgeoning market.
Even though event marketing bumped employee relations down to the number three spot, it’s still a strong market for promotional products. Employee relations slipped only one percentage point (from 41% of respondents in 2000 to 40% in 2001). Companies have recently been placing more emphasis on attracting and retaining workers. But it’s possible that company layoffs in 2001 increased the talent pool vying for jobs, making it less essential for companies to invest in improving
employee relations.
As we did with suppliers, we also asked distributors about their general impression of clients’ promotional buying habits and needs. Most respondents agreed that clients are seeking more services and becoming more knowledgeable buyers and sophisticated users of promotional products. The fewest agreed that clients are doing a good job of planning ahead for their promotional needs (similar to what suppliers said) or that they’re increasingly making use of co-op advertising.
Joseph Scott, CAS, vice president of Scott & Assoc. (asi/321502), believes that clients’ promotional spending habits haven’t really shifted all that much. “We noticed a slight downturn during the first quarter of 2002 and now we’ve made up for it,” he says. “I think that people just wanted to see how their year was shaping up before they started purchasing.”
Where The Sales Are
According to distributors, wearables are still the biggest promotional product category. Three of the top five product
categories distributors sold the most in 2001 were wearables: 1) shirts; 2) caps/headwear; and 3) other wearables like jackets, slacks, ties, etc. In all, 80% of respondents chose wearables as their top product category, up from 77% in last year’s
SOI.
“I think it’s part of the ‘romance’ of a company owner getting accustomed to seeing his or her logo on a garment and loving the feeling,” Williams says. “I think wearables are here to stay.”
Writing instruments held down second place, but as with last year’s findings, this category’s popularity continues to decline (32% this year vs. 37% last year and 47% the year before). If this trend continues, writing instruments could be displaced next year by either the fourth or fifth place categories – desk/office/business accessories (25%) or glassware/ceramics (21%).
We also asked distributors which product category showed the biggest sales growth. Wearables, cited by 60% of respondents, was the clear winner. This finding may reflect that companies continue to buy promotional apparel to promote their brand and enhance their image, as well as create unity and team spirit among employees.
Hottest Markets
For more than one-third of respondents (35%), manufacturing was the top market for promotional products in 2001, followed by education/schools/universities (33%) and associations/clubs/civic groups (24%). Financial institutions, previously the top market, this year slid to fourth place, no doubt reflecting the poor performance of the stock market and the down economy. Clearly, it’s going to take more than a free pen or T-shirt to help people cope with devalued investments and pitiful retirement account balances.
“Clients’ spending habits have changed,” says Sharon Biernat, MAS, president of Promotional Strategy Partners Inc.
(asi/301182). “Their spending is well thought out and clients are spending money to get results.” Biernat agrees that wearables are still hot, but notes that the client has very specific needs. “They want to communicate their message and try to track results – it’s not just ‘let’s just get some shirts’ anymore,” she says. Biernat also notices that clients are buying quality instead of quantity, and that more products are being bought for event marketing.
When asked what market provided the biggest source of business in 2001, distributors listed a total of 63 sectors, demonstrating that promotional products are indeed a universal marketing tool.
The largest group of respondents (13%) named manufacturing the biggest source of business last year.
Thriving Under Pressure
What keeps distributors on their toes? In a word: competition. Twenty-two
percent of distributors said they were most concerned about competition from existing distributors. And since the number of distributors continues to grow, that concern could occupy the top spot for years to come. At present, ASI member distributors number nearly 17,000.
Other top concerns for distributors in 2001 were crossover distributors (17%), followed by mail-order distributors/catalogers (14%) and price-cutters (11%). Despite tough economic times, price-cutters aren’t worrying distributors like they used to. Concern over that source of competition dropped to the fourth place spot this year, down from second place in 2000.
Roughly a third of distributors said they didn’t diversify their businesses in 2001,
possibly a reflection of poor economic conditions that prevented distributors from
undertaking new ventures or adding new services. But some distributors did diversify:
- 16% added new products
- 14% engaged in design and graphics services, and
- 10% added Web-site design.
Surprisingly few distributors attempted strategic marketing consultation, in-house imprinting/personalization or selling premium/incentive programs for the first time in 2001.
This year we also asked distributors to name the smartest thing they did for their businesses in 2001, as well as their top
marketing strategy for 2002. Many got down to the nitty-gritty to improve their business last year. The top-ranking response was “increased our client
base” (35%), followed by “bought software/hardware to streamline operations” (16%) and “increased per-customer average order size” (14%).
Less than one percent of respondents reported taking actions like enlarging facilities, increasing minimum profit
margins, marketing, recruiting, training salespeople or establishing or improving their Internet presence.
In 2002, the most popular marketing strategy (cited by 57% of respondents) is “focusing resources on increasing business from a select number of clients.” Nearly a third (30%) also plan to establish or improve their Internet presence, 25% will seek new domestic markets and a quarter of respondents intend to specialize in a niche market.
Show Biz Kids
Distributors have access to many types of trade shows and, unlike suppliers, the freedom to attend what they want, when they want. Our survey found that, on average, distributors attend four industry shows per year. Possibly to cut down on time spent out of the office and to minimize costs, they attended more regional shows than other types. According to the survey, distributors attended an average of:
- 1 end-user show without clients
- 1 national show, and
- 2 regional shows.
Though national shows have grown in number, one-third of respondents said they didn’t attend any of them. The largest group of distributors (41%) attended only one national show, and 18% attended two. Only 7% attended three or more national shows.
Distributors were more likely to frequent regional shows. Twenty-seven percent noted they attended one regional – although almost an equal number
attended none. However, 16% of distributors attended three or more regional shows, with 7% attending five or more.
Add together attending regional and national shows with one end-user show a year, and trade shows end up becoming a huge time and/or financial investment for distributors. What are distributors looking to accomplish from this “investment?”
A high percentage (86%) want to learn about new products. About 70% of distributors said they search for ideas with specific clients in mind. Sixty-two percent attend shows to stimulate their creativity. Over half of respondents (58%) go to network with suppliers and about half (50%) are there to collect catalogs. About 38% of distributors say they attend trade shows to take advantage of industry education.
“Education offered at our trade shows is a must,” Biernat maintains. “One great idea could change you, could change your business, therefore change your life! The education topics have kept up with the times, and I attend all the free seminars I can.
It’s hard to keep paying for seminars, especially when you have to pay for other staff to attend. But it’s important, so we’re very selective about how we spend.”


Trade Show ROI
Generally, distributors didn’t keep track of new suppliers they did business with as a result of attending industry shows. The 31% of distributors who were able to pinpoint the number of new suppliers reported an average of eight and a median of five new supplier clients. But the
majority of distributors – over 54% – said they didn’t track this data.
Even if only about 30% of our respondents did business with new suppliers they met at trade shows (using a median of five suppliers per respondent), that’s a lot of new business for suppliers. And distributors reported doing an average of almost $42,800 in business with these new suppliers.
Outside of our core industry shows, distributors indicated they also attend other types of trade shows. The largest group (43%) attended wearables shows. Over a quarter of respondents attended general merchandise/variety shows in 2001, and 26% attended premium/incentive shows.
What distributors don’t do a lot of is exhibit at trade shows. The majority (61%) didn’t exhibit at any shows in 2001. Still, that leaves 39% who did exhibit at one or more shows. More than half of these distributors reported generating leads, although 39% said they didn’t know if they did (which begs the question of why they were exhibiting in the first place). For those who did keep track, the average number of leads generated was 59 (median: 17).
Those trade shows resulted in an average of almost $40,000 in new business for distributors (the median was a more realistic $10,000). Certainly, exhibiting could provide a nice ROI for distributors who are willing to devote the resources needed to market and promote themselves at trade shows.
“We exhibit at two buying group shows,” says Scott. “By virtue of our affiliation, members are predisposed to buy from us, so it works out well. We can get ‘face time’ with several hundred business-owners in a very cost-effective manner.”
Jerry McLaughlin, CEO of Branders.Com (asi/145021), has a pragmatic outlook on trade shows, one that gives credence to the survey results that show both suppliers and distributors want a better working relationship: “The most important thing for us to accomplish when we’re at a tradeshow is to spend a quiet half hour or so with each of the leaders of our best and largest suppliers,” he says. “[I want to] meet the leaders of our suppliers, review the business we’ve done together and discuss ways to further strengthen our relationship. If we do that, then it’s a successful show.”



Michele Bell is the senior editor and Cynthia L. Ironson is a contributing editor of
The Counselor.
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