Final Word

Moving at the SPEED OF CHANGE

Fans of renowned business author Jim Collins, who published Built to Last back in 1994, will know the term BHAG. Collins defined BHAG – a Big Hairy Audacious Goal – as an objective which may seem a bit too far out of reach, but as one of the concepts that often distinguishes great companies from average ones.

AFFLINK is a sales and marketing organisation and leader in supply chain management services that connects suppliers of packaging, janitorial, safety, foodservice, office and MRO procurement solutions with independent distribution experts.

As its CEO, I’m not afraid to say that the team and I have set our sights on a new BHAG – to grow our business fivefold in five years. An audacious goal indeed, considering the industry is still learning to navigate the choppy waters of ongoing mergers, acquisitions and post-pandemic supply chain issues.

But the universe loves speed, so to speak, and the pandemic has exacerbated this reality for businesses exponentially. AFFLINK realised early on the landscape was shifting, saw how traditional B2B supply chains were devolving and decided to be proactive in its response. We knew we had to move. We had to evolve or risk becoming irrelevant.

OUTSIDE THE COMFORT ZONE

Though historically not our core competency, AFFLINK pivoted quickly to find and secure hard-to-source items for members during the pandemic. Like everyone, we stumbled a bit out of the gates and ran into the same issues all companies experienced in 2020, but more than anything, we learned. And we will use this hard-earned experience to control our destiny by expanding our global sourcing capabilities and continue leveraging our procurement expertise for our stakeholders.

Aside from plenty of challenges, the pandemic also brought opportunities. The work-from-home (WFH) movement and exploding e-commerce channel are just two of these which AFFLINK and its members are attempting to capitalise on for future growth. According to the latest Annual Retail Trade Survey report, released in April by the United States Census Bureau, e-commerce sales increased by $244.2 billion or 43% in 2020 – rising from $571.2 billion in 2019 to $815.4 billion in 2020.

So opportunity is rife – easy to see – but leveraging technology will be a key component to ultimately achieving our BHAG. Customers are still buying, but they are doing it in a different manner now. We need to understand their purchasing habits and then meet them where they are – online.

Capturing a piece of this growing ‘away-from-work’ spend, AFFLINK has created a marketplace – www.ELEVATEMarketplace.com – to offer an endless aisle of everyday items to at-home employees and microbusinesses that would not typically have anyone calling on them.

We have offered negotiated, last mile-delivered pricing and web hosting for publicly-facing e-commerce sites to our members for years. But the pandemic has pushed that need to the forefront, and we will continue to invest in this growth engine because we see it as a viable revenue stream in the coming years.

FINANCIAL BACKING

As a subsidiary of Performance Food Group, AFFLINK is responsible for managing the non-food business of our $53 billion parent company. Being part of a Fortune 100 firm, we are able to do things a traditional ‘buying group’ could never do.

We’re now focused on the ‘buy side’ for our members, using our strengths to deliver lower into-stock costs and not just being reliant on back-end rebate programmes. It’s this type of innovative thinking that will transcend our model and be a game changer for the independents that are a part of our group.

With so much consolidation taking place in this industry, some might be pessimistic about the future of group affiliations. We don’t share that pessimism. Certainly, the traditional group model will soon become obsolete, but what we’re building is an ecosystem where stakeholders work in concert so that the rising tide will lift all boats.

We want to be the home for independent dealers – and our pledge to our members is to continue to invest in the tools and technologies that will drive growth and provide differentiation for years to come.

Special Issue BREAKROOM SPECIAL

Dennis Riffer, CEO, AFFLINK

The traditional group model will soon become obsolete, but what we’re building is an ecosystem where stakeholders work in concert so that the rising tide will lift all boats

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Elina Pienimäki, CEO, Wulff Group

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