WHAT DEALERS EXPECT FROM THEIR OFFICE EQUIPMENT MANUFACTURER
In a perfect world, these are the kinds of things dealers should expect.
By Scott Cullen
After 16 years of covering the office equipment industry, one thing has been obvious over the years when talking to dealers and manufacturers, and that’s the state of relations between the two groups. While most dealers and manufacturers are hesitant to express their true feelings on the record, off the record, it’s crystal clear that some relationships are contentious and somewhat adversarial with both sides accusing the other of unrealistic expectations, not holding up their end of the bargain or engaging in foolish business practices. Dealers and manufacturers may not state these opinions directly to each other, but in hotel bars, off the record telephone conversations, meeting rooms and the like, this is indeed what’s happening every day across the office equipment industry.
Say what you want but the BTA dealer has been instrumental in building distribution for many of the leading office equipment manufacturers who have then of late made business decisions that have angered their long-time dealers or pretty much shut them out of the business altogether. Selling office equipment is a business and these decisions are made every day in every sector of the business community so office equipment dealers shouldn’t feel singled out. That doesn’t make it any easier when these decisions are made by their manufacturer and they’re essentially told, “take it or leave it.”
Taking a more positive approach, many dealers do indeed have a good relationship with their manufacturers. What makes them different? We’ve asked a number of dealers what they expect from their manufacturer (Next month, we’re going to turn the tables and ask manufacturers what they expect from their dealers). After all these great expectations help forge the foundation of the dealer-manufacturer relationship.
Many dealers were more than happy to go on the record with their insights into this important issue while others felt it was better to anonymously share their thoughts on this topic. To paraphrase Jack Nicholson’s character in the movie A Few Good Men, “You can’t handle the truth.” Maybe that’s a bit over the top when applied to this situation, but as much as some manufacturers want to hear it, the truth hurts and can very well negatively affect that fragile relationship they have with their dealer. With that in mind, here’s what dealers told us about what they expect from their manufacturers.
Fair pricing. “Without contest, the single most important requirement by any
dealer from the manufacturer is to be treated as a valued business partner
for the short and long term,” says Vick Meredith, President of DOCUMATION, Inc.
in San Antonio, TX. “This means that the manufacturer must provide equivalent pricing, including rebates, spiffs, program support, or any other financial consideration, so that the dealer is competing on a level playing field with any all distribution channels supported and utilized by that manufacturer.”
Meredith contends that national distributors, including the manufacturer’s own branches, should not receive products, including equipment, parts, and supplies, or any other services and support, for any less than the independent dealer receives. He believes that smaller margins for dealers will ultimately lead to the decline of the independent dealer and eventually the consumer will pay higher prices. “Small business is the backbone of our capitalistic democracy and any threat to this important but fragile structure will have a terrible impact on American business and consumers,” says Meredith.
Similarly, Al Aaron, sales manager for Saxon Office Technology in Morrisville, PA, notes, “Give me reasonable pricing to go to market with; I can’t be 20% higher than my competitor to start with.”
One dealer states off the record that two of his manufacturers have told him that independent dealers represent much larger distribution sources than the various mega dealers they do business with their direction operations combined. “Yet, these groups
receive preferential treatment from pricing to other real dollar perks such as attending dealer meetings at reduced or no cost as compared to the independent dealers,” he notes. “More and more manufacturers are treating us as if we were a necessary nuisance while they make alternative plans that don’t include us.”
Honesty. “Always tell me the truth even it’s not what either of us wants to hear,” says Bill Wallace, president of ABS in Baltimore, MD. Other dealers agree, albeit off the record. One dealer mentions an example, common to many dealers, of a new product in the field for three or four months that they’re getting service calls that they can’t figure out. When they call the manufacturer’s technical support line, their technical people are telling the dealer they don’t know about it and that we’re unique even though it’s an issue that’s happening all across the country. If the manufacturer doesn’t have the problem solved yet or have an answer, dealers like Wallace and Aaron want manufacturers to be honest about it.
Meredith also takes issue with the issue of honesty surrounding equipment problems. “When a problem is found, whether it is a design or manufacturing flaw already delivered to the dealer and possible the end user, or an anticipated delay of product availability, for the most part dealers and their clients are rational, loyal, and
understanding enough to accept the situation and work it through,” says Meredith. “Failure to disclose and even deny a problem exists is unacceptable costing the
dealer, its employees, and its client's time, money, and frustration.”
To be treated like a customer. This is another area that ABS’ Wallace feels strongly about, noting that the dealer is not just a means to a quota. “You’re damn right,” says Aaron when asked about whether or not he wants to be treated like a customer. “No matter how you look at it, I’m your client and I can leave you tomorrow for another manufacturer,” says Aaron. “I treat my customers like gold because they keep my lights on. If the customer doesn’t like you well enough they’ll spend the money to walk away from you.”
Listened to. Dealers are the ones on the street dealing directly with customers and have a first-hand understanding of what clicks, what doesn’t and what they need to be successful. “Listen to me, you may just find out what I need to grow my business to our mutual satisfaction,” says Wallace.
Good communication. You can’t get more obvious than this one and although many manufacturers talk a good game when it comes to communication with dealers, some fall short in this critical area. Wallace feels that it’s important for manufacturers to pick up the phone and create a proactive link with his dealership, not just at the end of the month for an order.
Timely availability of product. Jim Harrington, vice-president of sales for Dictronics, a Needham, MA-based office equipment dealership has three expectations: good quality product at a competitive price and product that can be delivered in a timely fashion. “If you can do that for me, I’ll do the rest,” says Harrington. While Harrington concedes that training, specials and advertising support are nice perks, what drives him crazy is when he and his sale staff make the commitment to selling customers on a new product and then when he calls the manufacturer to place the order, he’s told it’s not in stock or that production is behind schedule or that demand is greater than expected. “This is always a problem,” says Harrington, “and all [manufacturers] fall down on this at one time or another.”
Not to be competed with. As manufacturers have opened direct sales branches, acquired dealerships and purchased other manufacturers, many dealers are finding themselves competing with their manufacturer or other dealers in their territory with the same products. “This is becoming big out there,” says Saxon’s Aaron. “As a dealer, you want as little competition as possible.”
Technically sound product. “If I don’t have this, I’m fighting an uphill battle,” says Aaron, noting how he has won business from a competitor who was selling customers a competitor’s product that had consistent technical problems.
Cutting edge features. Every once in a while a manufacturer comes out with a new product or feature that’s cutting edge and gives their dealers a temporary advantage in the market. “I want that,” says Aaron who concedes it doesn’t necessarily have to be a revolutionary new feature or product but something his competitors don’t have. “I want to be able to go out there and say, ‘Guess what I have that nobody else does?’ even if it’s not an important feature.” Aaron contends that this is the kind of thing that adds sizzle to the sale. “Sales is sizzle, I don’t care what anybody says,” opines Aaron.
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