02. RESPONSIVE MANAGEMENT
Agile and responsive management
As the pandemic rolled across Asia toward Europe and the United States, Rexel’s business activities suffered an unprecedented blow. In addition to plummeting sales in certain regions, the customer and product mix was upended: the demand from electrical installers slowed, contrary to essential services like hospitals and critical industrial sites that Rexel supplied on demand.
A few years ago, it would have taken several weeks to obtain consolidated information. Thanks to the effort made to structure data, organize teams, and develop new digital tools Rexel had access, each night during the pandemic, to daily performance data for every country, including sales variations and profitability. Power BI, the reporting and sales analysis tool, implemented in 15 countries and covering 80% of the Group’s business, proved to be indispensable. This agile monitoring made it possible to quickly enforce any needed adjustment measures – a crucial responsiveness that was key to adapt to highly contrasting conditions, depending on the health situation and lockdown measures in effect in each region of Rexel’s operations.
The number of electronic signature uses in the Group, from late February to late May 2020.
Thus, on a country by country basis, the Group successfully managed partial unemployment measures and business resumption as appropriately as possible, while preserving profitability. At the end of the first lockdown, Rexel posted its lowest level of debt since 2008, which illustrates the Group’s ability to manage costs and focus on the creation of cash flow during a crisis situation.
Within a few days, the entire work set-up was reorganized and, thanks to the support of the IT teams, one third of employees moved to remote working, exemplified by Customer Relations and Expertise Centers, whose customer service representatives successfully handled all of their work from home.
The number of messages per day on collaborative tools within the Group,
from late February to April 2020.
“The health and safety of our employees and customers has been and will remain our first priority. Every protective measure was quickly taken and the Group widely disseminated its plan to follow and encouraged the sharing of best practices. Local teams led the implementation of protective measures to provide an appropriate response to highly contrasting situations, whether in terms of the pandemic's evolution, the availability of equipment, or local regulatory provisions. The Group and all of its entities remain extremely vigilant and continue to provide employees and customers with the best conditions possible in terms of health and safety.”
Rexel’s activity never ceased, despite experiencing a sharp decrease in volume. This continuity was crucial to maintaining the functions of essential services and structures such as hospitals, certain public buildings, vital industries or local shops selling essential items.
“The maturity of the omnichannel model, along with the adaptation of workplace organization at every level of the company, enabled Rexel to continue to serve all of its customers”, said Xavier Derycke, Group Supply Chain Director. Throughout the countries in which the Group operates, only a handful of branches were forced to temporarily close. In this unusual context, many customers opened their first online account to place their orders.
Another of Rexel’s major strengths, highlighted by Xavier Derycke: “The supply chain remained intact, thanks in particular to the internalization of distribution centers whose operations we entirely control.” Over the course of the past several years, the Supply Chain function was also reorganized in order to constantly better serve our customers. Furthermore, close connections with local transporters allowed us to quickly modify transportation plans and control costs without sacrificing service quality.
online accounts created in France in the three last weeks of March, vs. 300 per week usually.
Three questions for Xavier Derycke, Group Supply Chain Director
Did the Supply Chain withstand the pandemic?
Despite the violent nature of the crisis, the Supply Chain resisted. Service continuity was ensured thanks to the measures taken to protect employees and customers and to adapt to a totally unprecedented context. All the distribution centers remained open. We owe this resistance to our teams, which were amazing. An entire community joined forces and took action, whether on-site or at home, in order to continue to serve our customers.
How did the organization adapt?
Local management within each market enabled us to adapt the workforce to the sales volume and thus control costs.
Global inventory review became weekly rather than monthly, with frequent check-ins with our suppliers. Thanks to our close ties with traditional local transportation companies, we were able to adapt our transportation plans and control costs without sacrificing quality. We also spoke more frequently with our customers to adapt and relax delivery conditions.
What lessons have you learned from this crisis?
First of all, the fundamental importance of internalizing our Supply Chain: it was the key to managing our business and controlling the effects of the crisis. The Lean approach, which has been adopted by all of our distribution centers, also demonstrated its relevance. Thanks to a bottom-up model, employees are now more involved, heard, and empowered. The opportunities for dialogue and work within the Lean approach make it possible to handle an exceptional situation like the Covid-19 pandemic and to adapt. Ultimately, I would say that the crisis confirmed the relevance of Rexel’s positioning at the heart of the value chain, with respect to its suppliers, its transporters, and its customers.
Manager of ADNRJ, Roubaix (Nord, France)
“My company of three employees operates in the commercial market, mainly in electricity. I buy most of the required equipment from Rexel.
At the beginning of the year, we were working on a major shopping mall project as a subcontractor for a major public works group. After its sudden shutdown due to the lockdown, we quickly switched to directly managed projects to maintain our business volume.
During this period, we continued to get supply at the Rexel branch in Roubaix without difficulty. In this human-sized branch, we know the staff well and they remained very available. Our share of online orders increased during the lockdown, but our relationship with our sales contact continued, providing essential service continuity for us during the crisis. Indeed, being able to reliably procure supplies to execute our construction sites was a necessity. Although the commercial sector sites are still having difficulty restarting, we are still very much in demand by the major construction companies, which are increasingly resorting to subcontracting.
For me, Rexel has many strengths, but those that explain the long-lasting nature of our relationship are the closeness we maintain with our contacts within the branch, the presence of the brand throughout the country since we carry out projects all over France and, above all, the size and availability of the stocks.”
Manager of Electrotech, Armentières (Nord, France)
“The range of products available at Rexel allows me to stock up almost exclusively at the Armentières branch, with online orders for more than two-thirds of my purchases. This concentration of sourcing saves me a lot of time and allows me to benefit from a privileged relationship with the branch. These advantages have been further amplified during the lockdown. The availability of products and telephone contacts with the branch’s managers enabled us to ensure the continuity of our services. I was also able to order masks and hydroalcoholic gel, which was essential during this period. Since the end of the lockdown, we have had an even higher rate of online orders than before. But the contact with the branch remains essential. We’ve been in the plumbing and air conditioning market for three years now, and Rexel’s sizing services for thermal studies are very useful to us.”
“Our customers were very satisfied with the availability of our products during lockdown. Being able to continue to work without dealing with inventory problems was very reassuring for them. Some got into the habit of using rexel.fr and became autonomous with this channel, even though they were glad to return to the branch at the end of lockdown.”
An ultra-responsive network
at Rexel France
“In two days, all of our branches switched to ‘drive’ mode, with all customer orders provided outside the branch”, said Pierre Faury, Sales Director, Proximity and Network, Rexel France. “Our customers appreciated this service very much, especially independent contractors who continued to work on their projects during lockdown, and customers who performed maintenance works.”
Within three days, the 37 Customer Relations and Expertise Centers moved to 100% remote working. “The customer service representatives were available from home, with the same tools, telephone number and email address, in total transparency with customers”, said Pierre Faury. The sales representatives quickly re-established contact with their customers by telephone, especially since lockdown allowed them the time to review their files and to systematically call all of their customers.
Customer Relations and Expertise Centers switched to 100% remote working in France in a few days.
At the national level, the network swung into action with the creation of an expert hotline by profession and a national email address in order to help branches respond to their customers’ technical questions. Customer support at rexel.fr, especially for independent contractors, was strengthened, with the sharing of information about health measures, state-guaranteed loans, payment deferral for social security contributions, etc. Rexel also took advantage of the lockdown period to make more e-learning modules available to its employees.
While Rexel continues to face an unpredictable environment, its priorities are clear:
preserve health and safety
of employees and customers
ensure business and
focus on liquidity as key
protect the company
by focusing on gross margin,
opex and cash management
roll out all digital