During the American Supply Association’s recent NETWORK2020 Virtual event, attendees were given a live look at the new ASA D.NEXT Innovation Lab housed in Research Park on the campus of the University of Illinois in Urbana-Champaign.
ASA Vice President of Innovation Beth Ladd not only gave attendees a rundown of the lab’s purpose and short- and long-term visions, but also, with the help of D.NEXT team members, unveiled findings from the lab’s first research project.
In that project, D.NEXT set out to understand expectations of distributors and their contractor customers. To do so, D.NEXT reached out to nearly 100 distributors and 244 contractors to seek answers. The majority of distributors interviewed had operations of between one and 25 branches, while the majority of contracting companies were small, self-started, family-owned businesses. The average age of a distributor company that was interviewed was 76.3 years, while the average company age for contractor companies was 44.1 years.
D.NEXT asked distributors what they believe are their most valuable services, and compared those answers with the services contractors know about and find useful. Responses show distributors believe they provide a variety of valuable services to contractors, such as good prices, product availability, product quality, delivery speed, showroom accessibility, return policies and warranties. Contractor responses, on the other hand, value good prices, delivery speed and order accuracy the most from their supplier partners.
During interviews, the D.NEXT team noted a significant disconnect regarding the perceived value of technical support. Surveyed distributors rank technical support as the highest value service provided to their customers, while contractors rank technical support as the lowest among all options given. Additionally, a significant portion of distributor responses said their customers frequently had problems where they would contact the distributor for troubleshooting help or to answer a question on a product, while not a single contractor mentioned troubleshooting or distributor product knowledge as a service.
Another eye-opening project discovery: D.NEXT data shows more than 56% of contractors interviewed take at least part of their business somewhere other than a distributor. The D.NEXT team noted that when a quick-stop, unexpected trip to purchase products is needed, a contractor may consider factors such as suppliers with free refreshments, locations where a friend or long-time associate works, or locations of convenience to the jobsite.
“Complementary services, no matter how small they may seem, give contractors a reason to visit distributors and may have an impact on their buying decisions,” the D.NEXT team noted.
The study also reveals differences in distributor and big-box credit terms, and product-quality perceptions between purchasing sources. The D.NEXT team is interested in gathering data on the topics of product acquisition locations, methods and technologies, as well as delving further into big-box differentiators for contractor customers.
Full results of the market research project are available to ASA members only in video format in the MyASA Portal located at www.asa.net.