Blog form Vince McHugh
There has been much talk about the mega dealer RJ Young buying 4 RBS branches.But what does it mean? Up until this point the trend has been for the Manufacturers to expand through acquisition of Dealers. And when they could not acquire a dealer they would often open up a direct _BS (CBS, RBS, KMBS, etc.) branch and try to compete against their own Independent Dealer. It goes without saying that doing so has not endeared the manufacturers to their dealers.
The manufacturers in their defense were reacting to their competition buying up large parts of their distribution change. See my blog post. They felt that they needed to directly control their distribution so that this could never happen again. In the beginning their was a considerable chill between the manufacturers and their Independent Dealers. I heard one quote ascribed to a Ricoh executive that in the near future they wouldn’t need their Independent Dealers! What Hubris! I am guessing that right about now he is rethinking that opinion. Do I think that that the practice of Manufacturers selling off their branches to large Independent dealers is a trend? Maybe in the more rural areas, we’ll see.
I think Ricoh’s significant financial troubles made them the first to be willing to take this step. But other manufacturers continue to struggle with their direct sales force. In the case of Canon, I think they felt that CBS would fill the void left by IKON & Danka, and to a lesser degree Global. And while they spoke about how important the Independent dealers were to them, they were opening up CBS branches across the street, trying to put them out of business, or at least relegate them to a significantly lesser role. But it hasn’t been quite that.....read more here
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