In this issue of Electronics Sourcing we’ve asked companies for their thoughts on the future of distribution, starting page 21. I’ve been involved in distribution, first as a buyer, then a commentator since 1985, so I asked myself what distribution might look like in 30-years’ time for someone starting in the business today.
In a strange twist of fate, although I started my engineering career as a product designer, the building my employer was based in was shared with a distributor of engineering components. From recollection, in those days, distribution involved a shelving system, some products to sell, a van, Rolodex, some catalogues, a ‘local round’ and, most importantly, a personality that lent itself to forming strong face-to-face relationships. Fast forward to today and although the foundations remain the same, the mechanics of distribution have changed beyond recognition.
So, what will drive change over coming decades and what will the resulting industry look like? My heterodox opinion is that the biggest driver will be demographics. Basically, declining birth rates have been baked into the system for decades so ever fewer people will be expected to do ever more, for the foreseeable future. Therefore, relationships will have to be virtualised to the point where all communication is autonomously daisy-chained between computers via application programming interfaces.
If we then imagine AI will be tasked with asking the right purchasing questions, at the right time, with block-chain tracking every step of the transactions/supply chains and we have a picture of the future. So, in 30-years, one of the world’s biggest and most complex industries could become seamless and, to all intents and purposes, invisible.