WESCO Distribution Inc.

National Account Program

IMROZ JAIN
KAUSTUBH SANZGIRI
PARAMASIVAM
SANDEEP DAHIYA
SANDEEP SHARMA

IIMA/L&T, MEP BATCH-6, GROUP-7

Background

Founded in 1922, as the distribution arm of Westinghouse

Chairman Charles Ames

Third largest Electrical Equipment Supplier (EES)

Revenue of $2.2 billion

Three types of Customer base

Industrial Customers - $1253 million Sales
Electrical Contractors - $ 465 million Sales
Commercial / Institutional / Government (CIG) Institutions - $ 148
million Sales

Product orientated market strategy

Nature of Service

Wesco served 3 typs of customers Electrical Customers,

Segment

Market Sizr

Product
Industrial ,Customers Requiremen
t

Customer
Needs

Relationship

Electrical
Contractors

$ 17.9 BN
(2.6%)

Lighting and
Electrical
products for
construction
projects

Deliver in
time with the
least possible
price

Tender Based

Industrial
Customers

$ 16.7 BN
(6%)

EES products
for
Maintenance
repair and
operational
activities

One Stop
Solution for
MRO needs

Long Term &

JIT

CIG
Customers

$ 5.9 BN (2.5
%)

NA

NA

Stable

Wesco : Nature of Channel

Wesco has established 279 branches in US

Maintains own inventory and own P&L responsibility.
Substantial autonomy in its own territory
1/3rd of Branches serves customers of a specific industry
1 branch manager, 4 outside sales reps, 4 inside sales
reps, 1 warehouse specialist and 1 administrative officer
Outside sales reps acquire customers, while inside sales
reps ensure their retention
Disadvantage of serving narrower customer base and
cooperation between branches is limited

Changing Trends
During the late 1980s EES industry witnessed following
dramatic change,

Stringent supplier distributer quality norms

Customers looking for long term contracts
High levels of customer service demanded
Effort to minimize procurement costs
Implementation of concepts like JIT for procurement To
improve Supply chain efficiency by reducing inventory

Value addition to Customers

Offering integrated service systems to customers

Development of one stop solution for customer

Sales & Distribution
Customer Support
Inventory Analysis & reduction programmes

Responsibility throughout entire value chain

Standardize procurement and reduce costs

Presence near Customer Base

Enhancing Value Cycle encompassing customers, suppliers

Achieving market leadership in EES

Handling Customer Trends

Effectively managing the sales team :

Essential for the management as a substantial amount of cost is incurred in
maintaining sales work force
Proper training is to be given to NAMs and Sales Reps

Proper coordination of MRO procurement and materials

management activities

Leverage gained through a well-coordinated, national program

that delivers:
A uniform, competitive price across all locations

e-Procurement readiness and leading-edge technologies

Handling Customer Trends

Pool in further funds of $12 Mn

Concentrate on Interested CUSTOMERS only

Integrated IT system
keep a check on branch offices for NA Deals
Integrated Inventory management across all branches

Stress on e-procurement
Emerging industrial practices (LEAN/JIT)
Electronic Procurement with suppliers for reduced
transaction costs

Future of NA Programme

Lighting Audits/Energy Audits for energy savings

Consignment Services for reduction of inventory costs
Electronic Procurement for reduced transaction costs
Buying Power for uniform competitive pricing at all
locations
Proxy Distribution Network for reduced supply chain
management costs
Customer Inventory Management for increased
productivity and reduced maintenance
Application Engineering for product quality improvements
Training Services for increased productivity
Customer-based activity levels as measured by order
processing, delivery and invoicing transactions declined
Restructuring of the distribution network to be done and
more number of new branches to be acquired/installed
Should also make use e-procurement with suppliers and
Online shopping tools for customers to get globally

What we Recommend
Customer
Improve the analysis of Value Added Services
Go Online for Customers
Understand the local resource and goal of Customer
Customers with good prospect should be approached
proactively
Collaborate with Electrical Contractors
Develop expertise to provide integrated solution for
different business vertical.
Inventory buy back option to customer
Checkontheprocurementlist of thecustomersso as to
avoid differences in procedures and purchases
Standard products to make initial contracts with the new
customers instead of giving them detailed presentation on
reduced purchasing cost of employing WESCOs services

Proposed Plan for Industrial Aftermarket

Presence near Customer Base

Focus on local distributors rather than national distributors

Enhance Value Cycle encompassing customers,

distributors & SKF

WESCO

CUSTOME SUPPLIER
RS
S

THANK YOU