Advantages Of Group Purchasing

This is the first part of a three-part roundtable about buying groups. The buying group discussion started with our "Buying Group Leaders Speak Up" article.

How do you continue to create value in your group with distributors?

Since inception, the vision of SMA has been to serve as a “catalyst” within the channel. As such, the focus of the entire SMA organization is development and execution of programs, tools and resources that deliver maximum value to our members and also supplier partners. A hallmark of our group is collaboration with, and amongst, member distributors, which tends to enable us in effectively identifying and working toward objectives that are mutually important to all of our stakeholders. Value is defined differently by each participant, of course, and it is also a moving target. However, SMA’s focus on consensus-building amongst business partners helps eliminate false starts, reduce poor investments and achieve greater compliance throughout the group. — Dick McGann, president and CEO, Strategic Market Alliance, Charlotte, North Carolina

At AFFLINK, we continue to listen to what our members’ needs are and then align our resources to go out and satisfy them. Over the past few years, our members have continued to tell us to focus on two things: 1) Help grow my business through top-line sales and bottom-line earnings; and 2) Provide me with programs and services that will differentiate me from my competition. — Michael Wilson, vice president of marketing and communications, AFFLINK, Tuscaloosa, Alabama

One thing that DPA is doing that most groups are not is helping our distributors capture business through product diversification. In addition to janitorial/sanitary supplies, DPA is proud to offer competitive programs in the areas of safety equipment and clothing, tools and fasteners, packaging supplies, and restoration equipment. There are opportunities all around us to sell more through diversification whether it is a glove, hard hat, packaging tape, high-visibility vest or ladder.  DPA helps its members grow by providing them direct access to best-in-class manufacturers in these product categories, and we are delivering in a big way! DPA currently has a two-day safety and industrial products conference that members can attend, which takes place immediately following our janitorial products show. They don’t have to attend, but the option is there for them. DPA is always providing opportunities to help our distributors grow their business in the areas they choose. — Zachary Haines, executive director, DPA Buying Group, Cincinnati

We develop personal relationships with our distributors, and we work to develop benefits for them that do not impinge on their local pricing contracts or dictate their profit margins. We work to keep our operating expenses low so that members receive the maximum rebate dollars they are entitled to as owners of The United Group, and we try to help members stay ahead of the curve by anticipating changes in the industry. — Bob Klief, vice president of marketing, The United Group, Monroe, Louisiana