DISTRIBUTORS IN TRANSITION -- E-enabled Dealers

The Chicken or the Egg?
"The cost savings have been demonstrated," he adds. "The real obstacle is fragmentation: who goes first, the dealer or manufacturer?

While FitzPatrick thinks that the retail model was wrong for the industry, he does believe that the Internet can offer ways to make dealers more efficient. "The correct model is going to shorten and make more productive the transactions that go on between the manufacturer and distributor, because there are huge redundancies in inventory and transaction processing occurring. Inventory costs alone are staggering. People carry redundant inventory because they can't account for the products," he says.