As with most retail, online sales of parts for plumbers, mechanics and other tradesmen is rapidly sucking up market share. Rather than heading to the local hardware store for parts, tradesmen are now turning to online retailers like Amazon and others. Brian Baskin and Laura Stevens report in The Wall Street Journal:
Online sellers’ push into the market has nabbed much of the industry’s sales growth, analysts say, and sparked concern about the future of traditional suppliers. Ms. Lichtfeld said Madison’s local suppliers have stopped carrying many items easily found online. She also started selling spare parts on Amazon.
While parts accounted for a sliver of Amazon’s $136 billion in sales last year, the company is a proven disrupter of industries ranging from apparel to video to cloud-data services. Like retailers before them, industrial suppliers risk getting caught in a race to the bottom on prices, where online-only sellers have an advantage because they don’t maintain costly networks of branch offices and salespeople.
“You do not need a specialty salesperson to buy cleaners or a mop,” said Deane Dray, an RBC analyst.
Amazon is shaking up the traditional format for selling industrial parts by allowing distributors and manufacturers to sell products directly to businesses on its marketplace, eliminating middlemen and often undercutting traditional local suppliers. It also offers one-click ordering and transparent pricing, features that are the norm in online retail but less common in the industrial world.
Customers “just want the Amazon buying experience at work,” says Prentis Wilson, vice president of Amazon Business, which was launched in 2015.
Read more here.
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