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Top 20 Stories of 2019: #7 Rexel Lays Out Strategy for Year Ahead

Top 20 Stories of 2019: #7 Rexel Lays Out Strategy for Year Ahead

EVERY WEEKDAY FOR THE REST OF THE YEAR, TED MAGAZINE IS COUNTING DOWN THE TOP 20 STORIES OF 2019. BELOW, THE #14 MOST-VIEWED STORY OF THE YEAR, ORIGINALLY PUBLISHED ON MAY 6, 2019.

 


 

One year ago, Rexel spent a part of the NAED National Meeting to discuss its major strategy change to divide the U.S. into 8 regions as a way to be more responsive to their customers.

At this year’s NAED National Meeting, Rexel told its supply chain partners the regionalization plan is complete, which means faster decision making with a local customer touch and functional support that aligns to local execution.

“We put the customer at the center of all of our decisions,” Patrick Berard, Rexel Group CEO told supply chain partners at the meeting. “Sometimes that is difficult to understand from the outside. We got the best people joining us internally on this journey. It’s a journey where  the customer centricity will be the focus this year and next year and every year after that.”

At the strategy meeting last year, Rexel announced it had a goal of 56 branch resets and 12 branch relocations and 14 new branches. Rexel told the crowd it hit its goal of 26 new or moved branches, but completed 35 resets in the past year. Berard said it is in the strategy to open more branches next year.

But Jeff Baker, CEO of Rexel USA showed the company is working in a new direction: digital branches. Right now, Rexel has 2,500 digital proximity locations, or Microbranches, located closer to their customers. Most are in the Northwest right now, but Baker says he sees the future as, “Real, digital locations that are restocked every day, owning that last 100 yards to our customers. There’s sustainability in this model and there is definitely some momentum.”

Baker added that he sees the digital model in the company’s future. “We believe that the term distributor is an obsolete term. When you see our digital journey over the next couple of years, it is going to be a big deal for us,” Baker said.

Baker added what he calls a “pretty simple philosophy. We are committed to you and committed that we are going to sell more of your stuff,” Baker said. “We want to stock what we are selling. We added, last year, 100 million dollars in inventory. So let’s just make smart decisions. We are pushing hard to make sure all of our branches have at least the 3,000 SKUs needed to do business. It’s going to be based on reliability, and we want to be the most reliable.”

“We have long processes, we need to make them short,” Berard added. “We have complicated processes, we need to make them simple. We need to meet the needs of the customer faster.”

Rexel said it is very happy that it needs to re-figure its strategy for replacing employees. Baker said in the first four months of 2019, turnover is down 20%. “We believed it would take 1,000 new employees to reach our goals, now we think it is less than that because people are staying. We need people in our management and sales training programs. People want to be noticed and they want to have a chance. We are giving them the opportunities, and we are committing to having open positions filled internally.”

Berard added its partnerships with manufacturers remains a top priority. “We want your company to feel great working with us,” he told the crowd.

“We are keeping it simple,” Baker concluded. “We are being aggressive. We can’t complete our journey unless we have your respect, and the way we earn your respect is to do more business with you.”

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