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"Waterstone Consulting put together a strategy that will let us leap-frog our competitors, and carry us into the next decade." - President

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This company, a $700 million organization of truck parts distributors, leverages the collective buying power of its members to negotiate purchasing contracts with truck parts suppliers.
Executive Summary

Company members, however, faced problems not uncommon in a mature distribution market. For the individual distributors:

• Slow-moving inventory erodes profit
• Errors in the order process decrease profitability
• Larger competitors with advanced systems are tightening their grip on the market

Business Strategy

The company chose to expand its charter to address these challenges. They would provide members with support for business systems, supply-chain management, and marketing initiatives. They called on Waterstone Consulting to make this business strategy a reality.

"We are extending this cooperation beyond the traditional buying group," said Rick Podgorski, President of Waterstone Consulting, "By also sharing inventory, ideas, and marketing services, all distributors will become stronger, and more competitive."

Integrating over 120 distributors and manufacturers, however, poses technical, functional, and political challenges. Each company has different business systems, budgets, and ideas about system requirements.

Technology Strategy

Waterstone Consulting used its industry experience, project management skills, and technical expertise to bring together a Technology Strategy that meets the company's goals:

• Reduce on-hand inventory requirements
• Electronically communicate marketing, price-book, and membership data
• Automate rebate and contract compliance tracking
• Provide warehouse automation support

Project Approach

Waterstone Consulting positioned the Internet as a central component in the company's Technology Strategy, to provide 24-hour, global access to marketing programs and member information. The Internet will also provide communication of price books and other information between manufacturers and distributors.

Waterstone also showed the company how to leverage the Internet to transmit PO's, invoices, shipment notifications, as well as to track purchases and rebates and facilitate contract compliance.

"Using the Internet will eliminate the EDI cost-barrier for our smaller distributors," said the President.

A central data warehouse will allow company members to "share" inventory data. This will increase product availability, reduce lead times, and reduce on-hand inventory requirements for each individual distributor.

Project Success

With a forward-thinking Technology Strategy that is well-aligned with its business initiatives, the company will continue to attract new members, and strengthen the organization. Waterstone Consulting's Technology Strategy has positioned them to compete into the 21st century.

EXECUTIVE SUMMARY

Industry: Distribution	Benefit: Increased inventory turns Reduced on-hand inventory Increased pipeline visibility Global access to price books and programs Enhanced supply-chain management
Solution: Technology Strategy Contract Management Pricing & Availability	Technology: Internet/Electronic Commerce Electronic Data Interchange Data Warehouse Windows NT