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Optimizing investments with distributors

June 1, 2011
Does your company oversee its distribution investment with the same degree of thoughtful deliberation as a financial investment? Perhaps it should: Both

Does your company oversee its distribution investment with the same degree of thoughtful deliberation as a financial investment? Perhaps it should: Both can deliver huge dividends when managed for long-term benefits — and both present risk when managed on a shortsighted basis.

For example, your purchasing department may bypass a long-term mechanical-components distributor in favor of lower-cost supply venues. Short term, your company cuts spend from its component outlay. Long term, it diminishes the connection with its traditional distributor and may relinquish engineering services.

Authorized distributors

Industrial suppliers are often distributors who have been trained and authorized by a brand-name component manufacturer for the sale, recommendation, and maintenance of its products. At the plant level, authorized distributors tend to offer logistics services, (including warehousing and consolidated shipments), have close business relationships with plant floor technicians, and regularly meet with management and engineers. They also have a firm understanding of customer supply needs, storing critical spares in proximity to plant locations and monitoring the plant's product usage. At large facilities, such as steel mills, a distributor's representative might even have a dedicated office.

Beyond these arrangements, authorized-distributor services abound — often, just for the asking. For example, your authorized distributor might agree to partner in the development of written procedures covering your plant's components and equipment operation. This can include documenting historic usage patterns, determining optimum inventory levels at plant and distributor locations, and producing specifications for interacting with component manufacturers to fully understand lead times. It can also include elementary condition monitoring of plant equipment and recommending maintenance practices to extend component life. Some distributors even establish procedures for emergency situations, such as fire and flood, to quickly return a plant to operation.

Services can also extend to kitting, bundling, and special labeling. Here, your distributor combines multiple products and then labels them with a customer part number that is more descriptive than typical manufacturer part numbers. Distributors can generally produce and apply special labeling faster, better, and less expensively than manufacturers.


Quality distributors support design engineers as well. Case in point: An authorized distributor of rotating components, such as bearings and shafts, is among the first to know about new designs that can be used by OEMs to upgrade products. This distributor might alert food-processing equipment designers to the availability of bearings that employ dry lubricant, or advise producers of papermaking equipment about a new generation of roller bearings that permit component downsizing without sacrificing load capacity. The result: Space savings in the paper machine's design.

If you are an OEM, leverage your distributor's knowledge to design the most up-to-date components into machinery by asking for a periodic product review. Here, the distributor meets with your equipment designers, purchasing manager, and possibly a C-level executive to review new components beneficial for next-generation equipment.

Engineering services

Engineering services of brand-name manufacturers are particularly helpful. These include visits by application engineers, often at no cost, to inspect malfunctioning equipment, and advanced testing procedures, such as root cause failure analysis (RCFA), lubricant analysis, shaft alignment, and advanced vibration-monitoring services.

RCFA is worth particular note. Known for its ability to halt expensive recurring equipment failure, RCFA involves inspection of components in laboratory conditions by technical experts. Recurring failure can have a jarring impact on productivity; costs of downtime at a steel mill or paper maker can exceed $10,000 per hour.

Under an RCFA, if the recurring component failure is a bearing, inspectors will evaluate such items as wear patterns and heat symptoms to identify the failure's cause. For example, equally spaced axial dents on a bearing raceway might indicate that excessive impact was used during bearing installation; blue discolorations reveal the use of excessive heat.

The expert engineering services of manufacturers are generally available only through authorized distributors for customers of the brand name component; the savings in reduced downtime, uninterrupted production, and elimination of related maintenance costs is a windfall return on quality distribution investments.

Bill Moore, of the SKF Service Division, can be reached at [email protected].

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