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It’s Time to Grow Your Electrical Distributorship, Part II

By Bridget McCrea

The U.S. construction industry is booming again and economic indicators are largely positive despite the cloud of uncertainty that’s hanging over the nation during the initial months of the new presidential administration. Despite this volatility, at least one thing is for sure:  this is no time to sit on your hands, batten down the hatches, and hope for the best. There’s new business to secure, new employees to bring onboard, and new expansion opportunities waiting right around the next corner.

In this article series you’ll hear what business experts have to say about three different growth approaches that all distributors should be thinking about right now—hiring new employees; finding new customers and market opportunities; and expanding by opening new branches, merging with other companies, or simply getting a few more square feet under an existing roof.

Read parts 1 and 3 of this series here:


In this three-part series, experts will weigh in on three growth strategies: hiring new employees, finding new opportunities, and expanding your distributorship. In part I, one expert advocates for the strategy of hiring for the future, and not just for the here-and-now.


While the payoffs of physical expansion can be apparent, the actual act of expanding is anything but easy.

Start Looking for New Markets & Customers… Today!
If 2016 went out on a high note for your distributorship, then the first quarter of 2017 was probably spent fulfilling an onslaught of orders, working with existing customers, and putting out daily fires. That likely left little time to explore new market opportunities or reach out to new customers, but guess what? The year is still young, and there’s plenty of time to take a step back, look at the big picture, and figure out a few new ways to fill that sales pipeline.

As a business owner who works often with the electrical industry, Ryan Hulland of Netfloor USA Cable Management Access Floor Systems in Charlotte, N.C., understands how hard it is to meet the needs of current customers while also looking for new opportunities. But this double-edge approach is necessary in any economic climate… even when business is booming.

“In most cases, companies are best served by maintaining their current workforces while looking for new customers and entirely new industries to serve,” says Hulland. “Without a doubt, we are headed for a recovery, but that doesn’t mean a distributorship should immediately hire new employees and open new physical locations.”

In this new economy, Hulland sees agility, creativity, and value creation as the cornerstones of every success story. “Once you have so much business that you don’t know what to do with it,” he advises, “then you can start hiring the right people and consider opening a new branch.”

To get there, Hulland says electrical distributors need to get their internal and external sales teams thinking outside of the box and focused on more than just the day-to-day. This shouldn’t happen when sales slow down, on a once-per-quarter schedule, or when someone happens to have a few extra minutes in his or her day; it should be happening all the time.

“Whether you’re a sales rep, a territory manager, or a regional vice president, new customer acquisition and the exploration of new markets should be an ongoing exercise,” says Hulland. “Set the time aside for these activities on a regular basis— regardless of what your current sales sheet or workload looks like—and you’ll be able to ensure a steady pipeline through good times and bad.”

Establish Strong Bonds
To distributors that want to kick off a new (or revive an existing) business generation initiative, Heidi Pozzo of Pozzo Consulting in Portland, Ore., says the first step is to look at the markets that the company is currently serving and figure out if those markets are ripe for new products and services. “One of the easiest ways to grow sales is by selling more to your current client base,” she points out. “This is also quicker than going out and trying to gain traction in a brand new market.”

If you’re interested in tackling a new geographic market, Linda Henman, Ph.D., of Henman Performance Group in Chesterfield, Mo., says distributors should start by determining the level at which their competitors have already saturated that market. If, for example, a third generation, family-run electrical distributor has cornered the market within a specific city—and if it has obvious brand recognition and a strong reputation—then you may want to expand your reach outside of that area for best results. Or, offer something that the company doesn’t. (Is it up with and using the latest technology? Does it offer value-added services to its customers? Is it selling online via a full-fledged e-commerce website? Are its technicians and support staff well educated and experienced? Any “gaps” in these areas can present great opportunities for companies that have the resources to fill them.)

“Do some competitive analysis before you start putting time and money into potential new markets,” says Pozzo. “Who’s receiving the requests for proposals (RFPs)? Whose RFPs are being accepted? What can your company do to fill in some of those gaps and establish itself in the market as quickly and painlessly as possible?”

Ultimately, Pozzo says industries such as construction tend to be largely relationship-driven, which means it will take both time and effort to get established in a new market. On the bright side, this means that the distributor that does have an inside track with a certain company and its leaders, project managers, or buyers will be the first to hear about new opportunities and projects. “A great way to keep your finger on the pulse of the industry,” says Pozzo, “is by simply establishing strong ties with the people who are in it. That’s a very traditional approach that hasn’t changed.”

Breaking New Ground
When he thinks about how distributors go to market, Matt McCarron, VP of LEDVANCE’s Industrial Commercial Channel in Wilmington, Mass., says it’s not too much different than how a manufacturer would approach the same task. He points to the latest trends and transitions in the lighting industry as proof that “doing nothing” and “focusing on the day-to-day” can significantly impact a distributor’s sales volume.

“We’re at a point in the industry where it’s extremely important that electrical distributors have a vision into the future of lighting,” says McCarron, who points out that other product lines that distributors carry may not be as volatile as the lighting segment. “Some of the products are pretty stable, but on the lighting side it’s about keeping an eye on the next generation of innovation.”

McCarron says controls present a particularly good opportunity for electrical distributors that are not only seeking new markets and customers, but that also want to expand their own product and service portfolios. To ensure that it’s continually breaking new ground, for example, LEDVANCE centers its attention on finding unique ways to do business that it hasn’t tackled in the past—be it at the product or the process level.

“Specifically from a product standpoint, controls and lighting controllability is unquestionably the future,” says McCarron. “So even the distributor that’s engaged in the day-to-day sales of fluorescent tubes has to realize—and embrace the fact that—the industry is moving pretty quickly in this newer direction. This can be a challenging point for some, but it also opens a new window of opportunity for companies that are looking for new markets and customers.”

McCrea is a Florida-based writer who covers business, industrial, and educational topics for a variety of magazines and journals. You can reach her at bridgetmc@earthlink.net or visit her website at www.expertghostwriter.net.

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