Some competitors have formed partnership services with their channels of distribution
Symptom: Performance innovation, in the form of increased information and partnership services to distributors, has accelerated.
Implications for the market:
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Many competitors have begun to tie larger customers to them by offering software packages that help their customers manage inventory, for instance, and by supporting these customers with other broad-based information and communications services.
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These innovations can be powerful tools by which established suppliers can shut out other competitors.
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These services are designed to help customers purchase more efficiently, and thereby significantly reduce customer costs over a long term.
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When successful, such programs can established a real partnership between supplier and customer. The more a customer's costs are reduced through the service it receives, the more reluctant that customer will be to bring another supplier into the relationship or to give another current supplier more volume.
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Recommended Reading |
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Analyses: Perspectives: Conclusions we have reached as a result of our long-term study and observations.
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