The decorative plumbing and hardware industry is a fairly
close-knit industry comprised mainly of smaller manufacturers,
independent representatives and privately owned showrooms. What do
all three of these segments have in common? Entrepreneurs
essentially run them all. As a result, given their commonality of
interests and challenges, many members of the supply chain become
friends with one another. And therein lies our industry’s greatest
opportunity: Once the friendship is established, the opportunity
for a true partnership arises.
The traditional arms-length relationship between manufacturer,
manufacturer’s representative and showroom does not meet the
competitive demands of today’s market. If we continue to use the
existing model in which manufacturers use their representatives to
push as much product into the channel as they possibly can to
whomever they can, we will turn the profitable niche market of
decorative plumbing and hardware into a commodity market in which
the only differentiation between product and product outlets is
Simply placing products in the distribution channel and relying
exclusively on showrooms for results is no guarantee of
productivity or profitability for either party to the transaction.
To a very real extent, this relationship is win-lose, because the
vested interests of each party are not necessarily the same.
A new paradigm must emerge that focuses on creating effective
partnerships among manufacturers, representatives and showrooms
based on trust, mutual understanding of expectations and frequent
and meaningful communications.
Fair and Balanced
What makes a partnership
work? Some would say that a successful partnership is one that is
fair to all those included in the transaction. However, fairness
alone is too often an arbitrary concept that varies in the eye of
the beholder and is, therefore, too ambiguous a concept to be an
adequate guide. Instead, the goal of a successful partnership is to
achieve a symbiotic balance.
Symbiotic balance is a concept that recognizes that the
continued survival of the individual components of the enterprise
are bound up with the financial health and success of the other
members. Symbiotic balance demands that every partner benefits
meaningfully and significantly.
Achieving symbiotic balance is not complicated. It’s commonplace
among parties who recognize that each has to win for the business
relationship to be successful. When you take that approach, you
quickly learn to recognize those who do not understand the process
because they look to gain an advantage at the expense of their
In more than 20 years in business, I have come across very few
dishonest people. However, I have negotiated lines with businesses
that are so focused on their own needs that they don’t recognize
that the other sides have needs, as well.
For example, dozens of companies make mushroom-shaped knobs.
Many showrooms will carry not one or two, but four or five brands
of the same knob. When duplicate products are featured in a
showroom, the commitment on the dealer’s part to represent the line
to the consumer in a manner that can maximize profitability of a
particular manufacturer is lacking. The result is that the
manufacturer becomes less important to the showroom, and the
showroom becomes less important to the manufacturer. There is no
balance, symbiotic or otherwise.
Careful selection is paramount for effective partnerships to be
established, because not everyone is equal, nor do they want to be.
When showrooms commit to a particular manufacturer, they
automatically become more important to the company they select.
Most manufacturers offer additional sales discounts as the
showroom’s volume increases. Similarly, the showroom that
represents a product or line of products in a given territory well
becomes more important to the manufacturer, making additional
outlets for the manufacturer’s product unnecessary.
Making commitments illustrates the difference between being a
partner or a friend. A partner must commit to a specific line of
products at the expense of carrying a line from another
manufacturer who may be a friend. Symbiotic balance is achieved by
being open and candid.
Manufacturers, showrooms and representatives need to communicate
their respective expectations and objections. Most skilled
negotiators understand this and recognize that a truly successful
partnership is tied directly to the art of listening.
Showrooms must be willing
to listen to
the manufacturer’s concepts for bringing products to market.
Manufacturers must listen to showrooms’ description of what voids
there are in the marketplace. They must also listen when they tell
them the reasons some products sell and others don’t. Show-rooms
must carefully evaluate if a product meets its customers’ needs
before taking on a line.
When looking for new
partners, I want to know who core customers are. I need to know how
a showroom presents products to its market. I need to know the
showroom’s expectations of its own personnel. I need to be prepared
to discuss expectations for inventory exchange of slow moving
merchandise for faster-moving product and address other showroom
concerns. I need to know how committed my potential partner is.
Reaching symbiotic balance is achievable and almost inevitable
if showrooms, manufacturers and representatives know what they want
and effectively relate their expectations of one another.
Communication is the cornerstone of our mutual success.
It’s time to move to the next level. Are you my partner or are
we just friends?
Jamie Gregg is the CEO of Colonial Bronze company, a 75-year-old
manufacturer of decorative accessories headquartered in Torrington,
CT. Colonial Bronze is a founding member of the Decorative Plumbing
& Hardware Association. Gregg serves on the Executive Committee
as the organization’s president.