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I’m disappointed by the journey some manufacturers have decided to take…’
Retra Conference host, the journalist and broadcaster, Declan Curry, moderated an industry panel discussion with Robert Hughes, chairman of Hughes Electrical; Paul Tyler, CEO of CIH/ Euronics; Steve Jones, managing director of Sirius Buying Group, and Paul Hide, CEO of AMDEA. The big question was: are independent retailers still relevant to manufacturers?
Declan Curry: With more and more manufacturers going direct to consumers, or considering doing so, does the panel think that independent electrical retailers are still relevant to suppliers? Paul Hide: Yes – clearly, I couldn’t possibly say anything else! But having started my career in this industry by calling on independents, I know that if I was sat on the other side, sometimes I might not think they are – they [suppliers] appear to compete against them and grow their direct business. Retailers can offer the full solution, which no manufacturer can – nobody sells every part of a kitchen or bathroom, for example. Where you don’t want to try and compete head-on is by selling individual appliances – that is box-shifting. You have to think about the full solution.
However manufacturers react, it’s very difficult to build a brand
in AV or appliances online-only because the products are designed to be touched and felt and that can only be done in a physical environment. Very few manufacturers have their own retail outlets – they do
exist, but it’s a very small percentage. To me, that demonstrates that any manufacturer that tries to circumnavigate retail channels for physical product is going to struggle.
DC [to Robert Hughes]: Are you still relevant? Robert Hughes: Yes, but you’re only relevant to the extent that you add value. If you’re just box-shifting it to a courier who drops it to someone’s front door, what value are you adding? Nothing. How relevant are you? You’re not. But that’s not what most of us are about. No manufacturer wants to do the yards that we have to do to get to someone’s house, but we go there, and we go through thick and thin. We make sure their products are set up correctly and that they work.
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Very few manufacturers have their own retail outlets – any brand that tries to circumnavigate retail channels for physical product is going to struggle
Paul Hide
Steve Jones: Are we still relevant? Yes - absolutely. It’s a very emotive topic – and understandably so. It [direct selling] is an emerging threat, it accelerated over the past couple of years and here we are. I think communication is key – manufacturers need to be very transparent about what they want to achieve and why.
DC [To Paul Tyler]: It was inevitable that manufacturers were going to do this, wasn’t it? Paul Tyler: I’m disappointed by the journey some manufacturers have decided to take – I’ve taken more phone calls from our members in recent weeks on this topic than any others. Our members have grown these brands over the years – they
take the technology that manufacturers are good at developing and help consumers choose the right products. I’m not sure how many consumers, through choice, will buy
DC: So, why are they doing it? PH: I think it’s primarily for two reasons: one – selling the products that they don’t get strong distribution on, and two – trying to understand some of the customer demand and own that data for research.
from the manufacturers. I believe it will put a strain on the relationship between our members and the manufacturers. Transparency and dialogue are key – I’m encouraging our members to have open dialogue with the manufacturers. We still have an important part to play in the market – working together is key.
Retra Conference Review 25
Paul Tyler
Retra Conference Review
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