Have you ever found that the supply arrangement your distribution group made with a service chain didn’t translate into the amount of business you thought it would? Maybe the reason is no further away than your front door.
Over the years, warehouse distributors and buying groups have worked hard on behalf of their jobbers to obtain preferred buying status with various national and regional organizations that have a franchise or business concept at the shop level.
This effort is insisted upon from their jobbers, and appears to be just one of the measurements of the distribution organization’s worth to its jobber network.
That is where the problem begins.
There are jobbers throughout the country that have lacked focus on their own internal business development. Many appear to look at the WD and ask, “What have you done for me this year? Bring me the business and you will be worthy of my support and membership.” This has been going on for years and distributors continue to bring approved supply agreements to the table for their particular group to feast on.
They think they have done an outstanding job.
Too often, however, the jobber arrives at the repair chain outlet with the attitude that the shop now has no choice but to buy from them.
Think about this for a minute.
Whether a franchise or business concept, the shop is still an independent business building its own relationships with its chosen clientele. Now a jobber struts in and tells them that they must now deal with him: a jobber who may or may not bring real value to the shop, which in turn can affect the relationship of the shop with its clientele.
The shortcomings of a jobber can be anything from a delivery problem to a stocking problem. Sometimes the agreement asks both sides to do business with people and organizations they have actively chosen not to deal with, due to personal or business reasons.
What do you think the answer would be if the franchisee or shop business concept was asked if they wanted to do business with that jobber or this WD? The answer unfortunately in many cases would be “no thank you,” because that local jobber has behaved in a way that shows he doesn’t have a clue what he is doing and is a problem to deal with.
You are not going to win their business if you are perceived as order takers who are threatening them with an approved supply agreement.
Some examples that have been relayed to me include a jobber store that frequently states, “If you don’t buy from me I will tell your head office. We are your approved supplier and you must buy from us.”
With all due respect, it is time to totally bury this attitude in a very deep hole. It is pathetic.
WDs make deals based on key arrangements with the various groups across the land. The franchiser or concept group head office likes the price, buying arrangements, and payment terms. They feel they have done a good deal by putting this arrangement together.
However, there are jobbers within the network who are a problem. To the better franchisees or better shops of these concept groups, these jobbers are not worthy of this kind of business commitment. These shops don’t want these jobbers as their first call.
Jobbers must realize that in this day and age of competitive value, you cannot sit back on your heels and be an order taker. Jobbers who do this are adding an incredible amount of stress to the shop owner’s business, and the shop owner certainly does not require any additional added stress.
The issue that appears to arise most often is that the internal and field staff of the jobber simply refuse to believe that their habits and behaviour may be a problem. The shop is the problem, they say, and the jobber in question reports back to the WD that the shop is not cooperating with the first-call buying agreement. The WD then goes back to the franchiser or concept group head office and reports the problems being experienced with the shop.
In every case I have witnessed concerning this issue, the shop owner was always deemed to be in the wrong, but the fact is that the shop was right.
Conflicting points of view arise when staff at the jobber store are doing everything possible to protect their own jobs. The jobber store owner may even go to seemingly extreme measures to contact the shop owner to see where the problem is. The owner may listen and understand the shop’s problem. He may even assure the shop owner that everything will get fixed because what the shop was saying made perfect sense to the jobber owner, but then the problem does not get corrected.
The reason is simply that if a jobber has poorly trained, undisciplined, unfocused staff, they will fail to execute the changes required to correct the situation. The shop owner ends up looking bad. The shop is literally outnumbered by people saying that they have fixed the problem, but the shop is still complaining. The conclusion reached is that the shop owner is a complainer who can’t be satisfied.
Staff competence at the wholesale store level has become a major problem today, and upper management of these jobber and WD groups must understand the seriousness of this issue and focus on correcting this.
Too frequently some jobbers hire the cheapest staff they can get. The cost of staff is always a hot topic to these jobbers, less so the competency of those staff members. You cannot build professional business relationships using staff who do not see what they do in professional terms, or have the skills to put to work.
They are seldom empowered to develop their territory without head office authorization on almost all decisions. If a jobber can’t hire, train, and empower its own people, then management of that jobber business is totally at fault, not the shop owner. As at the shop level, competency is a critical factor in building the business and securing the right relationships with the right clientele. One has to invest in competent people.
Perhaps it is time to raise the bar and get more input from the shop level when putting together these supply arrangement deals.
Before they sign a deal, maybe the franchiser or concept group head office should at least take a survey asking if the jobber in its area was worthy of signing a supply agreement with.
Now I know for sure this would ruffle a few feathers. Many feel a shop can’t even make such a serious business decision because the shop owner can’t run his own business very well.
This is their typical customer shop which does not reflect the future of our industry standard, but consider the results. If the business relationship is not in place, then the WD has to address the issue with his jobbers as to what they are doing in the marketplace. The WD may not like that, but the fact is too many jobbers and staff need training and development on how to do business today with the shop level. You can’t be a best deal, local order taker. There is no future in that. The old frame of mind does not work today for the best shop owners, and it is the best shop owners that are going to be here seven years from now, not the weak ones.
Consider your worthiness to the best shops in your area. Are you worthy of a first-call supply agreement, if one was to be put in place with them? What real business value do you bring to that shop, and can you professionally execute what you preach?
Work on becoming a professional approved supplier and you will become one, with or without an agreement in place.
Robert (Bob) Greenwood is President and CEO of E. K. Williams & Co. (Ontario) Ltd. and Automotive Aftermarket E-Learning Centre Ltd. Bob has 28 years of industry-specific business management experience. He has developed shop business management courses for independent service providers recognized as being the most comprehensive courses of their kind available in Canada. Bob is the first Canadian Business Management Consultant and Trainer to be recognized for his industry contributions when he received the prestigious Northwood University Automotive Aftermarket Management Education Award in November 2003. E. K. Williams & Co. (Ontario) Ltd. offices spec ialize in the independent sector of the automotive aftermarket industry preparing analytical operating statements for management purposes, personal and corporate tax returns and business management consultation. Visit them at www.ekw.ca and sign up for their free monthly management e-newsletter. Automotive Aftermarket E-Learning Centre Ltd. is a leading edge company devoted to developing comprehensive shop management skills through the E-Learning environment. Visit AAEC at www.aaec.ca . Bob can be reached at (613) 836-5130, 1-800-267-5497, FAX (613) 836-4637 and by E-Mail: firstname.lastname@example.org or email@example.com.