I have met over 6000 distributors and scores of executives and managers of distribution led companies selling things as diverse as soap, shampoo, diapers, hair dyes, commercial vehicle parts, lubricants for cars and two wheelers, hand tools (screw drivers, files etc.), textile, shoes, paper, edible oil, rice, steel and what have you.
Though every industry believes very strongly that they are “different” and their challenges are unique, when I look at back at my discussions with them, I find a lot of common themes.
One of the biggest bug bears of these people is the problem of “slow movers” and how they all have tried with this problem all through their working lives, so much so that eventually all these slow movers are phased out in what is politely called “strategic product portfolio rationalisation”
If you are even remotely associated with the distribution environment, you would know the perennial problem and I would like to tickle your thinking for a moment.
Let me pose a riddle to you: A company deals with two products A and B. A sells about 50 units a week and B sells about 250 units a week.
Which one is a slow mover and which one is a fast mover? Think for a moment and fix your answer before you read on further.
I get a response from some people that A is a slow mover and B is a fast mover.
Now let me tell you that based on the information that I have given you, it is not possible to find out which one a slow mover and which one is a fast mover!
The missing information is this: The stocks lying of A are about 50 units and that of B are 1000 units.
Now tell me which one is a slow mover?