At the recent Bathroom Manufacturers Association Industry Conference, John Newcomb, chief executive of the Builders Merchants Federation, advised caution for manufacturers who sell direct to consumers and tradesmen.
Speaking as an expert panellist as part of the BMA conference’s ‘Big Debate’ discussion, Newcomb said: “The real issue is when manufacturers choose to go direct online, bypassing more traditional forms of distribution. I would be very careful with that strategy because I know from our own experience at the BMF and talking to various buying groups. There are suppliers that have tried to do this and who see merchants as the middlemen who are taking that margin off their own bottom line.
“Ultimately, it’s the merchant that has the relationship with the tradesmen, particularly in a local area. I think that’s more of an interesting debate where manufacturers have actively chosen to bypass traditional distribution methods and going direct to the consumer. I know there might be positive examples of that happening, but I know my sector is littered with examples where that has just not worked.
“So, just a note of caution to manufacturers who might be thinking that, because of the growth of online, I don’t need independents, I don’t need a builders merchant, I don’t need those traditional channels of distribution. I would be very careful with that sort of strategy, especially because I know that has been discussed in several manufacturer and supplier boardrooms.”
Newcomb’s comments came as part of the discussion around the pricing and exclusivity issues retailers have with suppliers that also sell online. The comments were in response to Rosalind Bridges, account development manager for home and garden at eBay, who, while also urging caution around focusing on one channel, said: “The consumer doesn’t see routes to market. What they expect is omnichannel, which is everything fitting together under one brand umbrella and for everything to work together really well.
“If the online presence doesn’t match with the off-line presence, then there’s a disconnect in the consumer’s mind that says there’s something not quite right here, and they might move away from that brand. If the consumer can’t research online or find prices online, then maybe that is also a disconnect. Going back to this idea of omnichannel, everything has to line up and match, all with the same values, quality and price points.”
The other panellists alongside Newcomb and Bridges were Mike Rigby, managing director at MRA Research, Dave Ruston, director of Eureka Research, and Jane Blakeborough, research director at Trend-Monitor. The discussion was hosted by BMA chief executive Tom Reynolds.