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Posted On: 10/18/2005

PTDA customer buying research places reliability as most critical factor

PTDA

U.S. and Canadian end users rate the importance of product quality/reliability most critical factor when buying one power transmission product over another.  That information comes from research conducted by The Power Transmission Distributors Association (PTDA). 

The research assessed the needs and buying habits of customers of industrial power transmission products.  Surveyed separately, U.S. and Canadian end-users were asked questions that addressed factors influencing product and vendor selection, willingness to pay for services and the role of price in the purchasing decision. 

In the United States, the online survey was conducted by Reed Research Group.  An e-mail invitation to participate was sent to 20,000 subscribers to Design News, Plant Engineering and Purchasing magazines; a 2 percent response rate provided results with a 95 percent confidence level.  In Canada, PLANT, Canada’s Industry Newspaper, administered a substantially identical survey with a 37 percent response rate.

To qualify to participate, respondents needed to specify or buy at least one power transmission product from a list of 16 general categories.  Among U.S. respondents, 58 percent specified or bought motors, with motor/motion control products (48 percent), hydraulics and pneumatics (47 percent) and pumps (45 percent) the next most common.  In Canada, the most commonly specified or purchased products included motors (53 percent), hydraulics and pneumatics (44 percent), adjustable/variable speed drives (42 percent) and mounted bearings (41 percent).

Forty-four percent of U.S. respondents described themselves as design engineers, followed by plant engineers (35 percent) and purchasing (21 percent).  Of Canadian respondents, 44 percent described themselves as plant engineers, followed by design engineers (33 percent) and finally, purchasing (23 percent). 

A broad range of end-use industries were represented by both U.S. and Canadian respondents.  Nearly half of the U.S. respondents and more than half of the Canadian participants reported working in the miscellaneous manufacturing, fabricated metal product manufacturing and machinery manufacturing sectors. 

On-time delivery/accuracy is considered the most critical factor when both U.S. and Canadian end-users select one power transmission vendor over another vendor.   Other popular U.S. and Canadian responses included technical support, expertise and responsiveness. 

Fifty-six percent of U.S. end users said product knowledge was the most critical importance when asked to evaluate distributor and manufacturer salespeople characteristics.  This was closely followed by follow through.  Canadian respondents also classified sales representatives’ product knowledge as most critical, followed by application knowledge. 

In order to isolate the role price pays in the overall purchase decision, respondents were asked how much of their decision is based in price versus other factors.  The average U.S. respondent bases 47 percent of the decision on price; the average Canadian buyer attributes 50 percent of his decision to price. 

Seventy-eight percent of U.S. end users and 82 percent of Canadian end users currently receive expedited delivery from vendors, making it the most popular service received.  Storeroom management and kitting were the least commonly received services in both markets.

Among those services for which U.S. end users currently are not charged but are willing to pay, training was mentioned by the highest percentage of respondents, followed by kitting, inventory management and engineering/design.

Other highlights from the research include:

--Nearly half of U.S. respondents have contracted power transmission vendors (45 percent), but on average these individuals make 33 percent of their purchases from non-contracted local vendors.
--Contracts appear to be less prevalent in Canada, with only 31 percent of respondents reporting they use contracted power transmission vendors.
--Only 30 percent of U.S. respondents and 40 percent of Canadian respondents receive bonuses or incentives in addition to base salary.  Among this group, productivity is the most common factor affecting the bonus achievement.
--Average spend on in-plant (MRO) requirements over the past year was $1,987,433 in the United States.  Average resale (OEM) spend was $1,699,652.  Similar data was not available from Canadian respondents due to insufficient response.