Case Study: IEC Supply – Pricing Process and the Specialty Distributor

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After considering a number of options, IEC Supply selected Strategic Pricing Associates based on what they considered to be one of the smoothest implementation processes on the market.  In just slightly over 90 days from signing the initial agreement, SPA came live with the IEC organization.  The following are excerpts from the IEC Supply case study.

casestudiesAnother myth exists around the pricing process

Over the years distributors have developed a mythology of their own.  Some believe technology is out of their price range.  Others feel process building a solid process around their business negates the creativity of their staff.   Another myth exists around the pricing process; where distributors conclude that pricing process is something that only works for those mega distributors selling commodity products.  Mike Zielinski of Arizona’s IEC Supply doesn’t buy into any of these commonly held beliefs.  Recently, we had the opportunity to speak directly with Mr. Zielinski, the president of IEC Supply.

“We don’t think like a small distributor.  Our investments in technology and systems puts us on an even playing field with anybody on the planet.”

Doing business across the state of Arizona, New Mexico and parts of Nevada, IEC Supply provides mission critical automation and electrical products to a wide variety of customers.  Compared to many of his competitors, Mike’s company is small.  But, as he puts it: “We don’t think like a small distributor.  Our investments in technology and systems puts us on an even playing field with anybody on the planet.  The only thing small about our world is our willingness to provide customized concierge quality service to our customers.”

IEC Supply utilizes the P21 ERP system coupled with a state of the art CRM system to drive business metrics.   “The products we sell are technical, I am technical (Zielinski is a degreed engineer), my people all devote a great deal of time and effort to staying up to speed on the cutting edge solutions available to our market and why shouldn’t we push this technology savvy into our business model?”, says Zielinski.

IEC Supply’s efforts have been well recognized by others.

In September, 20113, IEC Supply was the featured story for The Electrical Distributor (TED) Magazine.  In January 2014, it was announced that IEC Supply won second place in their division for business growth within the Affiliated Distributor organization.

One of the latest additions to this “scientific technology” bent comes in IEC Supply’s addition of the Strategic Pricing Associates pricing process.  IEC Supply has been “live” with Strategic Pricing Associates’ pricing process since August of 2013.  To Mike and his leadership team, the implementation of a scientifically-based pricing process was the logical step in giving his business the technological edge required to move forward.

IEC Supply has seen dramatic results.

According to Mr. Zielinski, the payback period for this piece of technology was less than two months.  Further, the ease of installation and implementation took a great deal of strain off of his administrative staff.  Per Zielinski, “We are a 20 employee company and we regularly push the limits of our staff.  Any kind of extra load on the IT department quickly spills over into other parts of the business.  The Strategic Pricing Associates program takes away much of the work required to get data from our business system to their pricing algorithms.  We basically assigned a trusted senior inside sales resource to identifying product and customer classes.  And overseeing the operation of the process.”

Advice for his fellow distributors

During our time together we asked Mike if he had any advice for his fellow distributors.  Here are a few of his comments.

“First, technology is your friend.  When I started this business some 25 years ago, technology was expensive, maybe outside the price range of a fledgling distributor.  Today, this is certainly not the case.  As a matter of fact, armed with the right systems, the advantage falls to the smaller distributor.  Accessing trends and analyzing data, gives the smaller organization the ability to act more nimbly than the big guys who need dozens of layers of approval to make a move.”

“I would encourage everyone to explore the options of a scientifically based pricing process.  With thousands of products and hundreds of customers buying these products, determining the right pricing level is nearly impossible.  When you don’t have a solid price on the system, it puts extra strain on your inside sales team.  Their role shifts from coming up with a price to finding the best way to serve the customer.  And, IEC Supply is about serving our customers.”

Click here to read the entire IEC Supply case study.

Click here to read more SPA case studies.

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