Data & Analytics
Data: Most Distributors See Gaps in Readiness for Advanced Analytics
November 13, 2026
Technology
Distributors face a critical choice between building custom software and adopting off-the-shelf solutions, each with distinct costs, risks and benefits. Here's a guide for determining which path is right for your organization.
Every distributor chasing growth eventually reaches the same fork in the road: Should we build our own technology system, or should we buy one?
It’s a tempting question, especially for companies with complex workflows and deep product knowledge. The idea of designing an IT solution from scratch feels like you’re in control. It feels like strategy or even digital transformation. But far too often, DIY software becomes a detour that leads nowhere.
According to a McKinsey-Oxford study, 17% of large IT projects go so badly they “threaten the very existence of the company.” These events have budget overruns of more than 200%.
Premium: Buy or Build Tech Solutions? Stellar Embraces Both (Sept. 2024)
On average, large IT projects overrun budgets by 45%, miss deadlines by seven months and deliver 56% less value than predicted, according to the same study. For distributors, where margins are tight and service reliability is non-negotiable, a failed or under-performing IT project wastes resources while potentially crippling fulfillment schedules and eroding customer trust.
Yet many still believe their needs are too unique and specialized for off-the-shelf platforms. So, they build.
A midsize distributor reaches a growth ceiling. Orders rise, channels multiply, and the legacy platform groans with every quote. At first glance, the answer seems obvious: Build a bespoke commerce and order-management system tailored to your workflows.
But ambition doesn’t always equal payoff. Older infrastructure is often a drag on digital transformation efforts. Custom technology builds appeal to distributors for many reasons: control, fit and sometimes internal pride. But they also carry hidden costs and long-term risks.
When does building make sense?
A custom build can pay off under specific conditions:
A single weak spot can derail a custom initiative, whether it leads to missed milestones or compromises the customer experience. What started as a strategic investment can quickly become a drain on time and resources.
MDM Case Study: MSC Industrial Supply (Premium access here)
The term “off-the-shelf” often gets a bad rap, conjuring images of rigid, one-size-fits-all software. But today’s solutions are a far cry from that. Many are built to be configured, extended and integrated without starting from scratch or sacrificing fit.
Choosing software to minimize pain in your organization can improve five key areas:
These advantages become even clearer when you examine how real distributors have navigated the build versus buy decision. One example comes from buildings materials distributor Pacific Coast Supply.
Pacific Coast Supply once planned to modernize its SAP order workflows with new custom in-house software. The project stalled under rising complexity, so leadership turned to an already packaged application embedded inside SAP instead of bolted on top. The positive results followed quickly:
More importantly, PCS avoided the snowball effect of unfinished features and undocumented customizations. Leadership eliminated more than half of its legacy code modifications, clearing the path for smoother future upgrades.
MDM’s 2Q25 MarketPulse Report (store link)
The company’s CIO candidly summed up the lesson: Attempting to replicate a mature product “at a higher cost” made little sense once they found an off-the-shelf option that matched company requirements.
Whether you build or buy, the answer should hinge on strategy rather than ego. Start by mapping goals against the realities of time, talent and capital. Test every assumption:
Answering these honestly often reveals that the right packaged software already solves 80% of the problem. Why not let your people focus on the 20% that elevates service and relationships?
The market is moving too fast for vanity IT projects. Customers judge each interaction and purchase by your responsiveness. Leaders who move with urgency set the standard other distributors are expected to match. Today, that usually means standing on the shoulders of platforms purpose-built for the job, then investing your resources where human expertise still outperforms code.
Which path lets you spend more time delighting customers and less time debugging the engine that gets you there?
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