However, though the integrated supply market is growing, we also detected more problems in the integrated supply market during the research for our third integrated supply report than during the research for our prior two reports. End-users cited several areas of discontent. However, resolving the first two issues will not result in large-scale changes in the nature of industrial channels of distribution. We believe that many of these issues are being addressed. More integrated suppliers are entering the industry and will bring additional resources.
Integrated suppliers are still in the process of identifying best-demonstrated practices.
One integrated supplier that has been in the industry for over a decade recently contacted us to help identify its own best-demonstrated practices. We believe the most challenging issue to overcome in integrated supply relationships is inadequate technical support. Inadequate technical support can lead to problems. Generating productivity savings is particularly critical in integrated supply relationships. The central goal of integrated supply is reducing total costs.