Why Distributors
Benny Lim for Alpha Engineering Solutions Pte. Ltd.
Alpha, as you know, is a CMP product and service provider. We create engineering capabilities and technologies to support our business needs. And then we have to sell it to you, our customers.
Way back at the beginning, Alpha chose to use a distribution model. Others sell stuff by going direct to the customer. Some have a mix of both direct and distribution. To be honest, Alpha sells about 20% of our products and services direct. We don't like it, but sometimes those giant customers give us no choice. Let me tell you outright, there is NO perfect model, NO perfect way of getting anything to the end-user. The one inescapable fact is that we've become a million-dollar company through the distribution model. We could not possibly get that kind of business through direct selling, we just don't have the staff or resources. Every mom & pop distributor could sign up with Alpha and sell our stuff. Many of those disappeared as the market changed. Some of those grew and lasted a long time.
And I've told the story before of a customer I called on early in my Alpha career. He was buying products and services direct from another supplier. When he said "I go direct!", you could feel the pride, the ego in the room. He was special! Since he would never consider buying through some lowly distribution, he freely told me what he was paying for his most common products. I was back in a week, with prices through his local Alpha distributor cheaper than his price. He was bowled over! Alpha quality, which he admitted was the best, at a competitive price. His other supplier was just keeping all the money instead of sharing it with a distributor.
Of courses, there are those other companies that would sell direct to you. They call themselves "manufacturers", but it would be a good idea to ask them, "Where is your factory? Can I tour your factory?" You'll find out pretty quickly that they are not manufacturers, no matter what they say. They buy products from others and sell them to you. We call that a "distributor". Hey, you're back where you started. Now if you really do find a supplier that will sell you direct, there are other things to consider. First is, a factory works on a schedule. So that factory will put your order on a schedule. Your product will be available in two months, or maybe one month if you're lucky. You want it tomorrow? Sorry about that. You should go talk to a distributor. That's where the inventory is, on their shelves. Oh, that's right, you want to "go direct".
In the past, mom & pop distributors would order the product or service from Alpha and then sell it to you. We call that a "broker" not a distributor". The distributor should have what you want sitting on his/her shelf. If he doesn't talk to him/her about their inventory. If they won't carry what you need, find another distributor.
There's also a secret way to find the perfect distributor for you. Pick the product or service that you have the hardest time finding. Then contact us and ask "Can you tell me which distributors have bought this particular product or service?" Then look them up and go talk to them!
Alpha, as you know, is a CMP product and service provider. We create engineering capabilities and technologies to support our business needs. And then we have to sell it to you, our customers.
Way back at the beginning, Alpha chose to use a distribution model. Others sell stuff by going direct to the customer. Some have a mix of both direct and distribution. To be honest, Alpha sells about 20% of our products and services direct. We don't like it, but sometimes those giant customers give us no choice. Let me tell you outright, there is NO perfect model, NO perfect way of getting anything to the end-user. The one inescapable fact is that we've become a million-dollar company through the distribution model. We could not possibly get that kind of business through direct selling, we just don't have the staff or resources. Every mom & pop distributor could sign up with Alpha and sell our stuff. Many of those disappeared as the market changed. Some of those grew and lasted a long time.
And I've told the story before of a customer I called on early in my Alpha career. He was buying products and services direct from another supplier. When he said "I go direct!", you could feel the pride, the ego in the room. He was special! Since he would never consider buying through some lowly distribution, he freely told me what he was paying for his most common products. I was back in a week, with prices through his local Alpha distributor cheaper than his price. He was bowled over! Alpha quality, which he admitted was the best, at a competitive price. His other supplier was just keeping all the money instead of sharing it with a distributor.
Of courses, there are those other companies that would sell direct to you. They call themselves "manufacturers", but it would be a good idea to ask them, "Where is your factory? Can I tour your factory?" You'll find out pretty quickly that they are not manufacturers, no matter what they say. They buy products from others and sell them to you. We call that a "distributor". Hey, you're back where you started. Now if you really do find a supplier that will sell you direct, there are other things to consider. First is, a factory works on a schedule. So that factory will put your order on a schedule. Your product will be available in two months, or maybe one month if you're lucky. You want it tomorrow? Sorry about that. You should go talk to a distributor. That's where the inventory is, on their shelves. Oh, that's right, you want to "go direct".
In the past, mom & pop distributors would order the product or service from Alpha and then sell it to you. We call that a "broker" not a distributor". The distributor should have what you want sitting on his/her shelf. If he doesn't talk to him/her about their inventory. If they won't carry what you need, find another distributor.
There's also a secret way to find the perfect distributor for you. Pick the product or service that you have the hardest time finding. Then contact us and ask "Can you tell me which distributors have bought this particular product or service?" Then look them up and go talk to them!
- The writer served as Applied Materials CMP Division's Total Product Support Engineer from 2001 to 2003 and Applied Materials Southeast Asia UMC Account's CMP System Specialist from 2004 to 2006.