Tuesday, January 10, 2012

Who's the Boss?

The customer is always right. Duh. That's like rule number one of business. For some reason, the beverage business blurs this line a little bit (or a lot). Theoretically, each lower tier of the distribution model becomes a customer for the tier directly above it. The distributor is the customer for the supplier, the retailer is the customer for the distributor. These are both true, but the lines can go both ways. The distributor, since they are the single outlet for the supplier, often receives pressure from the supplier. The supplier always has an option to find another customer. That just sounds weird. The supplier can fire their customer and find one that will buy more of their product. Does this happen anywhere else? The dynamics of this possibility make this relationship strange. In many instances, the distributor and the supplier are on the same page and partnered up. If not, the supplier needs to gingerly apply pressure on the distributor to buy and sell more product. When push comes to shove, who wins out? Well, no one. It's sort of a dance to see if each others abilities, pocketbook and priorities are even in the same ballpark. If not, lawyers step in, then everyone loses in the short term.

Ordinarily I'd try to insert some nugget of wisdom or perspective into the proceedings, but today, I have none. It's a strange dance, built around strange laws and everyone I know has battle scars to show for it. I'm lucky to be with like-minded distributors who are largely on the same page. I have no illusions that it will stay this way, but today it is, so all is good.

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