Industrial distribution to the rescue

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How White Distribution and Supply is supercharging the 3PL

By extending its scope beyond the expected, White Distribution and Supply (WDS) is creating new paradigms in the logistics and distribution space. The independent distributor of production consumables and maintenance, repair, and operations (MRO) supplies and equipment is challenging manufacturing companies to consider what JIT/3PL solutions can do for them.  

It’s no secret that manufacturers make their money on the production floor. Many support activities that surround the production floor are pure cost while the specific activities that get things produced is where money is made.  Today’s value-added warehousing and distribution models provide access to solutions designed to optimize space allocation.  

The WDS model goes even deeper, helping manufacturers leverage their real estate footprint and working capital to increase production capacity through customized JIT inventory management paired with JIT line side supply provision. “We’re asking them to rethink how they make money,” company President and CEO John MacQuarrie said.  

When production ramps up, some companies have the vision and resources necessary to take on a factory floor repurposing project, but committing to and implementing a reconfiguration plan that focuses on money making operations can be a time consuming, elusive process which rarely happens at full scale.  Even if they have the ability to do their part, they still need a partner to do the supply side work.  Other companies simply don’t have the vision to attack the opportunities.  In all cases, making the most of factory space is an ongoing journey for both mature and newer companies. 

WDS links the just-in-time supply of production consumable and MRO products with effective strategies to make their floor space and working capital do more. Executing that concept has required the company to do some rethinking of their customer engagement processes. The senior production supply and purchasing leaders that work on the supply side with WDS can be but aren’t always the key decision makers when it comes to developing real estate leverage initiatives. 

“It tends to be the executive leaders who are trying to find a way to squeeze more productivity out of a footprint,” MacQuarrie said, noting that CFOs, Presidents, and some Plant Managers are the right people to engage when considering innovative and customized 3PL solutions.  

MacQuarrie pointed to a customer in the booming window manufacturing space that bought a plant to accommodate the pandemic-driven surge in demand. He estimated that within the 100,000-square-foot facility, only 15 to 20% of the operation was dedicated to production. “The rest was dedicated to receiving and stocking — yet the company was outselling the plant output by 20%.  

“Something has to give, right? If you don’t get customers what they need when they need it, they go elsewhere. Part of what we do is help companies challenge themselves to leverage their real estate and all working capital assets as best they can. Our customer engagements tend to build off discussions like that.”  

The benefit of balance 

The warehousing and distribution industry has been a longtime leader in continuous improvement, from the early adoption of automation, to applying TQM, Lean, and JIT principles. In MacQuarrie’s view, the pandemic is also prompting global industry to look at efficiency through a risk management lens. “Because we’ve chased continuous improvement and efficiency so aggressively, when things slip out of norm, as they did with the Tariffs and then again with Covid in 2020-2021, we see the margin of our global supply chains was way thinner than most of us believed it was. It’s reminding us that we must have some balance in what we do,” he said. 

Supply chain disruptions are nothing new, whether from port strikes, tariffs, war, weather, or pandemics, and their impacts are part of the ongoing struggle to mitigate risk while maintaining a healthy bottom line. These days, reshoring and redundancy are particularly hot topics when it comes to regaining that balance.  

“Having redundant manufacturing plants, distribution centers, and supply chains costs money,” MacQuarrie said. “Business leaders now have to make smart assessments about how much risk they can stomach and how much unfavorable drag they want to put on their P&L by having safety stock insulation in their supply chain.”  

Industrial manufacturers face unique problems, such as the need for customized storage and transportation for large pieces of equipment or delicate components, and other requirements such as kitting and packaging can be extremely detailed and complex.  “Independent” industrial distributors like WDS have a significant role in helping their manufacturing customers succeed.  

“Companies like Amazon and Grainger are doing a nice job. They’re really hard to beat when it comes to picking, packing, and shipping standard products. Those companies are fantastic at it. But manufacturing customers of today need more than that,” MacQuarrie said. Picking, packing, and shipping is only a piece of the puzzle. “That’s why you haven't seen a $75 billion-plus Home Depot-like industrial distributor,” he said. 

 “The needs of manufacturing customers really allow for great value-added solutions, and independent distributors continue to set the bar pretty high for what those solutions and partnerships with customers can look like.”  Independent industrial distributors in North America have been offering value added services for nearly a century. WDS and others like them tend to get deeper and more intimate with customers given their legacy proximities.   

“Understanding your customer’s business lets you unlock a number of doors to value creation when you get to that level of intimacy,” he stressed. “It’s harder for the bigger distributors to develop that level of customization, and at the end of the day that’s where independent distributors continue to lever themselves. WDS is a great example of that.” 

The company plans to double in size and is eager to help manufacturing companies grow with them. MacQuarrie offers potential customers the following advice: 

“We’re asking companies to reconsider how much of their plant’s footprint is fully committed to ‘making,’ and to take a hard look at the amount of capital they’re deploying on inventories of finished goods, supplies, and component parts. The answers to those questions are a great starting point for a deeper discussion about what’s possible.  When you’re ready for that conversation, WDS will be there to help you focus on what matters most – the manufacturing activities that make money.”