Dealing with dealers
Many international giants have made substantial global presence through dealers and franchisees while holding the reins either from their headquarters or from regional offices.
Unlike the system of direct supply, wherein the manufacturer directly deals with the end user, selling through a dealer is less complex. Many big manufacturers primarily focus on dealers, because they have much better connections locally in the industry and have better access to the market discernment. Though the manufacturer, in several instances, does not directly deal with the end user, he has a much wider reach through the dealer’s multiple networks. The dealer here projects a one-stop-solution-under-one-roof concept by providing for all cleaning needs including equipment, tools and other services.
Though the manufacturer maintains direct contact with big contractors and industrial or retail customers, major business dealings are accomplished through dealers. Even when it comes to operating through franchisee offices, dealers execute the contracts. “And of course, they have a better scope to do service, as they deal in multiple products. They have a much wider service system than what you get when you directly go to the market,” says Oliver Degen, International Branch Manger, IPC Gansow.
“We believe that dealership is the right approach to the market. This is the approach IPC uses all over the world and this is our business model. We’ve dealers at two levels – big regional dealers and small sub-dealers – to get the maximum reach to the end-customer. To avoid direct competition between dealers, we give different distributorships – either industrial, retail or healthcare.
“In some business models, manufacturers put multiple dealers on the same product but that could be counter-productive. We also don’t ask dealers necessarily for exclusivity because we know that the more brands of products the dealer has, the better is for the end-customer and it is also good for us to benefit this in the long run. Further, the dealer can also divide his costs on many products and benefit. If I have the best product, then for sure, sooner or later he’ll have all my product range.”
“But to offer better services to customers and for a dealer to become a good dealer, we seek hands-on information on the product we are selling, the technology, the system, etc.,” says Sandeep Godse, Director of Cleantech Services, who has recently signed dealership with Nilfisk. “We share a very close and trusted relationship with our customer, hence we are expected to be at the beck and call of the customer and we are willing to go to any extent,” adds Sandeep. But it training the customer or providing spare parts or after sales service, the dealer calls the shot.
It is essential that the dealer has the right knowledge and field experience. Unlike selling mops or down the line vacuum cleaners where after sale service is seldom required, when it comes to complex products like scrubber driers, sweepers and high-pressure or industrial vacuum, service is the most important part.
“The relationship with the end-customer does not stop when you have sold the product, it actually begins with the sale of the product,” says Oliver. “Yes, it is only after selling the product, we begin with the training of the housekeeping staff with the operations,” adds Sandeep. In India, with frequent change in housekeeping staff, training becomes all the more crucial and complex. A staff trained today may have quit the job the next day, so the process of training continues, adding to the dealer-customer relationship.
Maintenance forms another criterion of good dealership, because the dealer should be able to service perfectly and professionally the products he sells, otherwise it could mar the image of the manufacturer, feels Oliver.
“Thus, we give the dealer all the information he needs to go to the end customer. We’ve it all on internet – the repair manuals, spare part lists, marketing materials, all the brochures or sales guides. We also have videos on Youtube and the dealer can show the video to his customers – the kind of machine and its applications. This also saves cost.”