Our overall sales volume is derived from sales directly to Original Equipment Manufacturers (OEMs), as well as through Electronic Distributors. The latter segment has been growing nationally at a greater rate than OEM. This has been true for us also, and it can be said that our growth in distribution sales is due to a planned approach and investment in manpower/facilities.
Our overall program reports to the President's office, but is under the direct control of our Vice President, Distribution. He is supported by each of the Area Vice Presidents, Territory Managers and a select group of salespeople, Distributor Specialists and sales support personnel. Additions to this group are made on a continuous basis, particularly in Distributor Specialists used in our major markets.
Our distributor program is designed to encourage the placement of all possible purchase orders through distributors. We do this by continual education of industrial customers to use the inventories and quick response time of our distributors, by systematic referrals of orders, and by training distributor personnel on product.
Distributors who are located within the geographical regions served by each of our
twenty (20) offices are serviced by one or more salespeople from that office, plus Distributor Specialists in the larger offices. Numerous educational meetings and many sales promotions are conducted each year on behalf of our principals, (usually on the distributor's premises), although several meetings are also held off site. Business plans are established for each major distributor on each authorized product line and progress to plan is monitored monthly. A review of each distributor's performance to such business plans helps us determine the desirability of retaining each distributor or, in some instances, may point to the need to seek better outlets. We work closely with our principals to continuously upgrade the quality of our authorized distributor network.
Each Whitesell office has several tools to help support our authorized distributors for each principal. A matrix is kept up to date showing which locations carry inventory, which are sales offices only, which have authority to issue purchase orders and which issue our principals' point of sale information. Computer reports are provided each Whitesell salesperson showing the dollar amount sold by distribution for each of our principals to his customers. This amount is then credited to the appropriate salesperson, who is compensated accordingly.
The manner in which we manage our distributor program is reported to be among the best of any representative in the electronics industry. Over the years, we have been successful in attracting every major distributor to handle our principals' products; and, we believe our principals are obtaining maximum penetration of that portion of the marketplace within the Whitesell geography.