''More like a crisis manager than distributor" Interview with Bert Schukat in Markt&Technik Q3

With around 290 manufacturers and 50,000 products, Schukat is firmly positioned among diverse mid-sized companies, especially among those focused on power. At the same time, it is also one of the specialists in the distribution sector. Managing Director Bert Schukat, however, has little time for classical pigeon-holed thinking. A turnover increase exceeding 40% validates his strategy.

Karin Zühlke conducted the interview.

Markt&Technik: In 2021, the distribution sector in Germany set new records. How satisfied were you with 2021?
Bert Schukat: The past year, as we know, was marked by allocation. Our procurement and sales worked and continue to work under extremely high pressure. We are shifting from one crisis to the next, and we feel more like a crisis manager than a distributor. Our focus had been primarily on keeping supply chains intact, and so far we have been successful in doing that. With our position in the market, we’re able to react quickly, plan well in advance, and make recommendations to our customers. Most have followed these, and our order books, accordingly, have been full. There are bottlenecks everywhere, not only in semiconductors but also in precursor materials, connectors, resistors, inductors, capacitors, and bearings, to name just a few.
To give you an example: we had extreme difficulty delivering products from one of our fan suppliers due to the limited availability of a particular part. Our supplier did not have enough feedstock for their production. Our customers, of course, were not happy about this, but we have to be able to manage such situations.
Overall, we were able to record a considerable increase in turnover in 2021 compared to the previous year, which we could not have predicted at all.

Bert Schukat: ''In the future,
I believe that many manufacturers will not undertake parts of their business themselves but will concentrate on their core business.''

How much of an increase, exactly?

We saw an increase in revenues of 47 percent, with turnover reaching 157 million euros gross.

Does that also mean an increase in the bottom line? Many companies in the electronics sector complain that the net result has not increased with the turnover.
On average, we were able to maintain our margin. However, we also had to accept reduced margins in a number of areas – due to high increases in transport costs, for example. There are many reasons for this. Events in China have seen many switching from sea freight to air freight. We believe that the only economically viable transport route for the customer is by sea. We are therefore striving to plan our stock levels for our customers in such a way that we can serve them by sea freight. This has advantages, but also means a high degree of commitment from our side.

As I see it, Schukat's business model does not really fit into any of the classical categories – it is neither a volume, specialist, nor eCommerce distributor. How would you classify your business model?
Digitalisation is becoming increasingly important in all business processes, and we serve all target groups except for the private end user. Every customer is handled according to their specific requirements, either personally or using the digital services we provide. From enquiry to delivery, and together with our business partners, we work hard to generate added value at a digital level along the supply chain. This means that the exchange of data internally and externally needs to be simple and straightforward.
We are certain that, if we want to survive in the future, we have to significantly develop digitalisation – and that we have to integrate our suppliers and customers, too. Large customers in particular expect technical solutions from their service provider. And depending on who they are dealing with, each one has a different digital focus and is looking for an individualised solution. As I see it, that is where the key to success lies: things must be easy for the customer, and they must happen fast. Customers are used to plugging a keyword into Google and getting an answer in seconds, and they expect something similar from a distributor. We want our customers to be able to put in a manufacturer’s part number and find what they are looking for as quickly as possible. On top of that, industrial customers are also looking for delivery schedules, logistics models, and more.

So, in which of the classical categories would you position yourself?
That’s hard to say. We carry products from over 290 different suppliers, and they categorise us in various ways: for some, we’re among the specialist distributors, but others see us as volume distributors, e.g. for fans and power supplies. Working with Panasonic on inductors and capacitors, we also see ourselves as volume suppliers.

Have there been highlights among the suppliers added in the last twelve months?
We are strongest in the switching power supply area, which we are also constantly expanding. In addition to our existing partnerships with MeanWell, Recom and others, we added XP Power last year, and we expect that line to develop well. The XP products represent a good solution where challenging operating conditions call for high reliability and failsafe protection. We are also seeing enormous growth in print power supplies – used, for example, as power supply modules for the control electronics in wallboxes. This is being driven by electromobility projects. For our customers, this means we can offer even more expertise in power supplies.

The interview with Bert Schukat was published in Markt&Technik Quarterly on July 23, 2022, see here.