How did business change for HDA in 2022 compared to 2021?
Distribution America and PRO Group joined forces in April 2022 to form Hardlines Distribution Alliance (HDA). We are striving to become a larger, more impactful and more efficient organization by combining the best of both organizations. Generally, in 2022, supply chain issues improved (though not yet to pre-pandemic performance), while distributor sales outperformed 2021 in high single digits.
What were some challenges in 2022 and how did HDA address them?
Staffing, fuel costs and transportation were three top challenges experienced by HDA members. A gradual return to face-to-face office environments validated the importance of physical presence that platforms like Zoom and Teams simply cannot deliver. Staff have adapted once again to an office environment, but we did learn the importance of virtual interactions during the pandemic, prompting hybrid schedules and more regular, interactive virtual communications. A portion of rising fuel and transportation costs had to be passed on to customers, but members also absorbed a portion of these costs. We are optimistic that 2023 will be less inflationary with respect to fuel and transportation.
How are you helping your members address technology?
HDA has just signed a commitment to outsource software that will streamline rebates and member purchase data, improving the accuracy and turnaround time to members in 2023.
Periodically, we conduct an operational performance survey that gathers key metrics and comparables that help members identify how their companies compare to their peers. Access to this data helps prioritize member technology investments that make the most sense. We have scheduled a warehouse operations workshop in April 2023 where members will bring in their top logistics personnel to share best practices in material handling and order fulfillment to retailers. Automation is a major focus of the workshop, and it’s the first time we have been able to gather in-person since the pandemic.
Additionally, we have updated and streamlined the Central Pay process to accommodate more frequent payments that improves benefits to wholesalers and suppliers.
How are you helping your members address succession planning?
We have several members who are focused on growth via acquisition. HDA is in a good position to identify and then facilitate communication between members who have transition and succession opportunities over the next several years.
What are your projections for 2023 for the industry and for your organization?
We believe the economy will show less growth than 2022, but we still see solid opportunities for business improvement by becoming more efficient as an organization. By continuing to communicate, share best practices and adopt the most efficient processes and technology available, we will strive to help all member businesses capture margin and productivity gains that will lead to a stronger overall performance in 2023.
To read our complete 2023 Market Measure, click here.