Alno: where do we go from here?

The owner of Rugby Fitted Kitchens considers what retailers can do if they suddenly lose their main supplier

In light of the current uncertainty surrounding the good ship Alno and all who sail in her, just how hard is it for the dealer network of any brand that may be experiencing problems to jump ship?

The uncertainty surrounding its current situation does raise an interesting hypothetical question about how retailers can protect their business if they find themselves one supplier down.

Well, in the first instance, simple survival is going to be the biggest problem if dealers are experiencing uncertainty and possible disruptions to supply.
This alone could cause potential cash flow issues for independent dealers. After all, Edmondson Interiors, in Kent, had to call it a day after losing just two, admittedly large, orders [see kbbreview July, pg5].

If these dealers are solus, then this compounds their problem, as a quick-switch sale is not on the cards.

Savvier independents will no doubt already have had discreet conversations with potential alternative suppliers. I certainly would have.

If, however, you’re a franchisee, then not only are you solus, but you’re contractually bound to only supply products offered by 
the franchisor.

Potentially, changing displays in 
the short term won’t be too big a deal as, and let’s be honest here, many of the leading brands carry remarkably similar ranges. So out with the old brochures and point-of-sale and in with the new can be arranged in no time. Give it a few weeks and a new set of door samples will soon arrive.
The retailer can then carry on trading while new displays are designed, ordered and installed.

But who are the alternatives?

If you are thinking about changing to a major name in the market, chances are they will already have well-established dealer networks and neither they, nor their existing dealers, will be too keen on opening up another outlet in the same town or within a reasonable distance.

The retailer seeking a brand change might well be down to their second, third or even fourth choice of manufacturer before they find one that is even willing to talk to them.
To change an entire showroom unexpectedly is not something that can be undertaken just like that, as the cash simply won’t be there to do it, so a good deal will be essential.

Many brands will be able to offer deferred invoicing deals on displays whereby, if an agreed first-year target is achieved, then some or all of the invoice will be credited. Just how much will be down to each manufacturer, its policy and your negotiating skills.

Another problem will then be just who is going to do the fit-out? Assuming you’re selling and installing clients’ orders to keep the cash flowing, you won’t want to pull your own fitters off paying jobs to do the showroom refit, and not all manufacturers offer a showroom fitting service.

And those that do, will make a charge for it, which will have a negative effect on your deferred display invoice deal.

If you are facing such a dilemma, it might be worth considering a move away from being solus and bringing in a second, supporting brand – perhaps a UK supplier to spread the future risk and broaden the product offer.

But will these suppliers be able to offer sufficiently attractive display deals to win your support?

Whichever way you look at it, if a situation like this does arise, it’s going to be tough, but independent kitchen specialists are a hardy bunch and I’m sure most will successfully rise to the challenge.

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