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Europe’s power transmission distributors identify end-user market trends

Brussels, Belgium - Challenges and opportunities in the Pan-European industrial marketplace were discussed at the recent All Committees Days meetings of the European Power Transmission Distributors Association in Brussels. The association has...



Brussels, Belgium – Challenges and opportunities in the Pan-European industrial marketplace were discussed at the recent All Committees Days meetings of the European Power Transmission Distributors Association in Brussels. The association has compiled a white paper presenting the outcome of these discussions to provide a clearer picture of the trends in the power transmission and motion control (PT/MC) end-users markets.

For the study, EPTDA distributor members, who are responsible for promoting and developing best industrial practices and continuing education, shared their market experience and identified major trends in the end-user industries. Here are some of the results:

- In Europe, re-shoring by the OEM (original equipment manufacturer) industry is a frequent practice; as a consequence, this industry has the ability to provide end users with innovative and secure machinery solutions. Mechanical solutions are increasingly linked to motion, actuators, drives and controls. The teams who try to find solutions for end-user factories are joint teams of mechanical and electrical engineers who are responsible for steering the factory’s robot-generated output.

- Technical warehousing is in most cases outsourced to industrial distributors, who execute VMI (vendor-managed inventory) solutions and VOI/consignment. Typically 300 up to 800 mechanical and electrical items are stored. Purchasers generally prefer long-term agreements (more than three-year contracts).

Procurement issues for the industry start raising questions around total cost, not only parts pricing but also for storage and administration/transportation costs. The factory output, uptime and meeting regulations are complex issues that a professional and specialized purchaser needs to take into account and analyze carefully. It seems that in the job description of an industrial purchaser, you encounter more and more attributes of a product manager nowadays in Europe.

- Trust in the distributor is a rising trend, as it shows in Italy, where industrial customers reward the added-value provided by distributors. PT manufacturers who try to deliver directly to end-users are often dismissed because of the lack of timely tailored delivery; limited service levels and lack of liability.

- Customers in general want to reduce their delivery risk as much as possible. Therefore, the approval duration is increasing for new products so time allocation needs to be slightly modified.

In addition, new purchasers are younger and more open to change and exploiting new product solutions, so in order to keep up with this new trend, manufacturers and distributors need to be flexible and constantly create and prepare new solutions.

Customers are liable for their output and welcome EPTDA distributors as qualified advising distributors in the business chain.

- The most important buying factor remains on-time delivery! Both manufacturers and distributors need to make sure that the product gets to the end customer in time.

- Product life cycle management and budget control are also key to remaining competitive in Europe. Western European countries are re-investing in the manufacturing sector to stimulate employment. Production is starting to become attractive again because Europe is now competitive again with the Far East in terms of labour costs versus quality output. Similarly, sustainability must be measured and guidelines and benchmarks should be given (e.g. minimal 30% energy usage against the same factory output).

Coping with today’s new challenges, one way to survive is to increase the value proposition of the maintenance and engineering departments. Technical knowledge and experience is essential. Customers are looking to replace aging processes and machinery, so the role of the distributor in providing knowledge and solutions is increasing. Customers require services and added-value – a total solution, not just the products. The role of the distributor in all this is essential.

EPTDA, an association for the industrial distribution channel in Europe, the Middle East and Africa, currently has a membership of more than 240 companies across 30 countries worldwide, that represent over 26 billion euros annual sales volume and 250,000 employees. EPTDA’s mission is to strengthen its members in the industrial distribution channel to be successful, profitable and competitive in serving customers according to the highest standards. The association can be contacted by e-mail at info@eptda.org.


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