You can’t open the papers today without seeing front-page news
of corporate malfeasance. From Tyco and Enron to WorldCom and
Martha Stewart, corporate governance and business ethics have come
under public spotlight. Mutual fund scandals, shady financial deals
and legal maneuvering for the self-aggrandizement of publicly
traded company executives grab headlines. They are symbolic of a
new challenge facing all businesses, including those involved in
the decorative plumbing and hardware industry.
Although most businesses in our industry are privately held,
decorative plumbing and hardware is not immune to corporate
hypocrisy, dishonesty and business practices that show disrespect
for employees, suppliers and customers.
For evidence, think back to the recent K/BIS. The echo of
security personnel voices in the New Products Pavilion continues to
resonate. “No photographs, please. Do not take pictures. No cameras
allowed. Anyone taking pictures will be removed from the exhibit
hall.” Over and over again, the warnings were issued, but even
those admonitions failed to keep cameras off the show floor or
cheap copies of innovative design, advanced technology and unique
applications from appearing in exhibits at the show and in
showrooms throughout the kitchen and bath marketplace.
Many of the copies are sold at a fraction of the original cost
because the companies producing them don’t need to invest in
research, development or design. Their labor supply is often
plentiful and compensated at rates that are impossible to match in
a developed country.
And, there’s no requirement to comply with environmental
regulations in many of the places where these copies are made,
which lowers the cost of creating them even more.
So, what’s the answer? We must continue to innovate. If we
don’t, the defining characteristics of our industry will gradually
erode, leaving price as the primary differentiator.
It’s easy to use those who mimic designs, manufacture them in
the third world and bring them to market as commodities as
scapegoats. But we can’t use that as an excuse for declining market
share or other issues.
We live in a global economy where markets are unforgiving. We
need to reward the entrepreneurial spirit responsible for the
Showrooms must continue to educate their sales personnel to
understand and appreciate the differences between original designs
and copies. They need to recognize quality differences between
different components, as well as finish quality and other defining
factors that differentiate products.
Once they can do this, they can better educate customers so they
can make informed purchasing decisions about these products. For
that reason, the Decorative Plumbing & Hard-ware Association
Education Program is providing an invaluable service to the
industry. This program is the only educational offering that
combines technical training with guidance to improve sales
Industry organizations such as the DPHA and the National Kitchen
& Bath Association and publications such as Kitchen & Bath
Design News, among others, must continue to provide forums where
innovation is recognized, honored and promoted. The industry has to
take advantage of awards programs to showcase creativity and to
promote the differences between unique product lines and
This isn’t easy. Clarity is clouded further by intellectual
dishonesty among those who claim to be industry advocates. There
are several highly visible industry professionals who make their
living as consultants and professional conference speakers. They
supplement their income by charging fees to mention company names
in their presentations and they do this without notifying their
audience of the compensation that they receive.
Showrooms and manufacturers must consider the disservice that
paying these marketing and consulting fees has on their businesses
and on the kitchen and bath industry as a whole.
Returns rank as one of the most
hotly debated topics in the decorative plumbing and hardware
industry. Most returns occur when:
- Showroom personnel err in writing customer orders.
- The products do not meet customers’ needs, forcing them to
return the goods for products that do meet their needs.
- Manufacturers err, e.g. ship the wrong goods.
- Goods are damaged during shipping.
Showrooms understand that they are differentiated from
competitors by their merchandise, service quality and value-added
services. Merchandising differentiation means a showroom can
distinguish itself by carrying products that consumers cannot find
at other outlets.
Service quality translates to an ability to meet and exceed
customer expectations. To that end, value-added service is
considered by many to be doing whatever it takes to make a customer
happy. And, therein lies the challenge to having an effective and
ethical return policy.
Does doing whatever it takes require leveraging a relationship
with a manufacturer to take back goods simply because the return
request is made by a good customer? Too much time, energy and money
is spent looking at the cost of accepting returns. The industry
needs to focus its attention on why goods need to be returned.
Showrooms may be reluctant to carry merchandise from
manufacturers that are not accountable for the quality of their
products or the quality control procedures used to process orders.
Showrooms cannot maintain a customer base if their personnel
consistently err in processing orders.
The industry needs to stop blaming everyone else when a problem
occurs. There must be accountability combined with competence to
effectively develop, implement and administer an effective returns
policy. Training and quality control should come to the forefront.
If this effort is not made, the credibility of the industry will
continue to come into question.
Unrealistic customer expectations also erode credibility. These
expectations are the result of
several high-profile national companies that, in the guise of
outstanding customer service, have created a mentality that
anything can be returned for any reason.
As a result, showrooms and manufacturers receive products on
return for reasons that are utterly ridiculous.
We know how old products are because we date label each piece
that we manufacture. Many of our peers in the industry follow
similar practices. We know when a returned product has been used,
yet showrooms will fight for their good customers, even when they
know that their arguments are specious. But the question that
should be asked is, how valuable is a customer who would ask the
showroom to comprise its integrity for a new product or a repair
that is not defendable? What effect does that have on the
The issue of ethical practice also is
raised in the pricing arena. If there are inherent discrepancies in
pricing structures that do not allow for apples-to-apples
comparisons, the only by-product is distrust from every component
in the supply chain.
Manufacturers that rely on the professional showroom need to be
true to that relationship. They can’t have one pricing structure
for the Internet and one for retail. Manufacturers need to resist
the temptation to go around the showroom when they receive price
requests from contractors that may be looking for a better deal if
they can buy direct. Those that attempt to have their cake and eat
it too, often find that they only receive crumbs.
Recently, the DPHA Web site featured a situation where a
showroom received an exclusive product line. The showroom
advertised and marketed the merchandise at its own expense with
substantial success. After creating produce awareness in the
region, the manufacturer joined a buying group that has a showroom
member located two miles from the first showroom. The
representative for the territory claimed that the exclusive could
no longer be honored because of the contractual obligations of the
In this case, the manufacturer had a business decision to make,
but this scenario serves to highlight the importance of
relationships in the decorative plumbing and hardware industry.
We are a small industry segment where there are few unknowns.
Manufacturers, representatives and showrooms all have to work in
concert to succeed. Principals need to focus on developing the
right relationships with partners in the supply chain who are
committed to mutual success.
The right relationships foster an environment of increased
profitability for all. Partnerships must work both ways. If a
manufacturer offers an exclusive to a showroom, the showroom must
honor that commitment by resisting the temptation to carry
competing products from other manufacturers.
Inherent discrepancies in pricing structures, failing to honor
commitments to those in the supply chain, return policies that have
short-term benefits but long-term detriments and the failure to
recognize the difference between originals and copies affect the
profitability of every business. If your actions create an
environment of distrust, you can’t build loyalty among
Lack of loyalty translates to high turnover and a reputation
that compromises a business’ ability to properly serve customers
and remain a viable enterprise. There are many in the industry that
strive to be the suppliers of choice. They are committed to
creating partnerships based on trust and intellectual honesty. They
are accountable for their actions and foster growth and
professionalism among their partners, employees and customers.
Challenges in the marketplace do not dismiss the entrepreneur’s
obligation to continue to lead by example.
Jeff Robboy is president of the Miami, FL-based Baci by Remcraft, a
manufacturer of hand-assembled bullet fixtures, lighted make-up and
shaving mirrors and G-9 halogen wall fixtures. He serves as a
director of the Decorative Plumbing & Hardware Association and
as a member of the DHPA Executive Committee.