Why Join A Buying Group?

In this second part of our four-part roundtable, buying group leaders answer more questions from distributors.

Why would an established, successful, growing distributor, that purchases 95 percent of its products directly from the manufacturer, join a buying group?

The rebates are obviously the driving force, but I think that any distributor would welcome the opportunity to network with other distributors. Everyone in our industry has common problems, and they are all looking for solutions. Wouldn’t you rather face those challenges as part of a community rather than as an island? — Bob Klief, vice president of marketing, The United Group, Monroe, Louisiana

All DPA distributors are buying their products directly from manufacturers and many are also buying from redistributors. When purchasing from any of those companies, DPA members receive a quarterly CJD (rebate) and in many cases better pricing, lower minimums, better terms and a more advantageous prepaid freight policy.

Since the DPA Buying Group leverages the collective volume of its distributor members, our programs are above and beyond the programs that a single distributor could negotiate on its own. Joining DPA also allows the distributor access to quarterly promotions that it would not normally receive and warrants an invitation to attend DPA’s annual buying conference. The annual meeting enables DPA members to share best practices with one another and also to establish relationships with the top-level executives from each manufacturer. If a problem arises they know who they can contact from that supplier to get immediate results. We have also flown in sales experts to educate our members on more effective ways to capture and keep business. Finally, DPA helps members save money with selected technology platforms for e-commerce and inventory management. Joining a buying group like DPA is about taking your business to the next level through savings, education and opportunity. — Zachary Haines, executive director, DPA Buying Group, Cincinnati

The phrasing of this question is actually a misnomer as it relates to SMA. We do not describe ourselves as an organization whose focus is “buying,” as the descriptor implies. SMA is composed of successful, like-minded, like-size distributors who align together and work interdependently toward the development and implementation of programs, resources, and services that can assist them in the growth and development of their respective businesses. The further development and strengthening of supplier relationships, both as a group and independently, is certainly important to our members. However, their choice to become an owner of SMA via membership is also steeped in their group’s willingness and desire to augment their businesses via national account development, marketing support, training programs, sharing of best practices and networking with peers — all of which have become hallmarks of SMA. — Dick McGann, president and CEO, Strategic Market Alliance, Charlotte, North Carolina