The kbbreview Interview: Michael Marriott | Waterline

With the KBB distribution sector in a choppy state of flux, one of its biggest names has launched a whole new offering into one of the most competitive areas of the market. For new Waterline CEO Michael Marriott, it’s a simple philosophy – “distribution has to be more than just moving boxes.”

What is often referred to as ‘the kitchen industry’ is not really an industry at all, it’s actually a loose raft of lots of different industries all lashed together.

Appliances, furniture, worktops, sinks, taps and all the other elements that make up a kitchen usually only physically come together in three places – the customer’s home, the retailer’s showroom and the distributor’s warehouse.

Distribution is traditionally the practical link between the manufacturer and the retailer, but it is a sector in flux. By its nature it is a high volume and low margin business and when the overall market is suffering, distributors feel the pain more than most.

I think there’s a real gap in the market for products that are available to a showroom retailer and aren’t sold on a website

Michael Marriott, CEO, Waterline

Last month saw International Decorative Surfaces call in the administrators; in July, Swift Electrical was saved in a quick pre-pack deal, and in March last year Bradshaw Luxury Appliances went into administration.

Over in bathrooms, February saw Brausch and its sister company, DHL Bathroom Supplies, placed into liquidation and in January Robert Lee Distribution was sold to investment company HLD Group.

Waterline itself was purchased by Crown Imperial in 2011 – it effectively bought its own distributor – and this combined size and offering has kept it at the forefront of the market ever since but that doesn’t make it immune to broader trends.

New CEO Michael Marriott is more conscious than most that even well-established distributors like Waterline need to adapt and change to survive.

“If all you’re doing is buying in stock and getting it from A to B three days a week, that’s not enough to maintain your business with retailers or suppliers,” he says.

Crown Imperial is a family business, started in 1946 by Marriott’s grandfather Len Head making wooden toys and nursery furniture. Len’s son Michael Head took over in the 1960s, assuming a patriarchal role that would see the company grow exponentially into the kitchen market.

Marriott’s half-brother Barry Head took over as managing director of Crown Imperial in 2015 and Michael joined Waterline in 2021 as finance and commercial manager after a successful period in Hong Kong as a management trainee.

Assuming the CEO role earlier this year he has already overseen the return of the printed Blue Book catalogue and, most significantly, the company’s first foray into bathrooms. But he has also taken over in a market that his veteran sales director Rob Taylor describes as “the most challenging he’s ever worked in”. It is, even with the backing of the family behind him, a baptism of fire…

Michael Marriott

You took over as CEO earlier this year, but Waterline is such an established operation so where do you start?

The first thing I did was nothing. I’m a big believer that you shouldn’t go into a business and just start making changes left, right and centre. You need to understand the market and the customers. We serve thousands of customers and some buy a single product and some plant their flag with us and buy everything for a kitchen.

I’ve been looking at how to give those different types of retailers the very best service. It’s how we can get as close to a true partnership as possible, because the best way for us to both grow our businesses is to help them sell more.

Distribution is obviously as much about logistics as it is service so a big part of the job must be about ruthlessly looking for efficiencies in the process.

I’m quite a numbers person, so yes definitely. It’s always about trying to remove any wasted motion. For instance, we have three depots and you could have taken all goods into Milton Keynes, split them up, and then sent them to our other depots. Well, maybe in the future, they’ll be delivered straight to Bolton, to Bristol, and to Milton Keynes – saving time and money.

There’s lots of little things to tweak that will improve our systems. While we like to make profit as much as anyone else, saving more margin allows for investment back into other levels of service. It’s always a numbers game and looking to trim any fat.

Waterline is a real bellwether so what is your current interpretation of the market?

The market is undeniably down but it’s not consistent across the whole industry. There are some people who have full order books and they’re still doing well. There’s a few areas of the market that are actually up even. I think the middle-price kitchen has been hit the hardest.

Lower end kitchens are definitely hard too, but with credit the initial outlay of cash isn’t as prohibitive as maybe as it is for other ends of the market. It’s the middle-market that has really struggled to justify purchasing a new kitchen and, even when they have, they may have lowered their specification.

You’ve just launched Waterline Bathrooms, an unbranded range of furniture and sanitaryware, but bathrooms is a pretty saturated market. What’s the thinking behind it?

To offer our existing customers an extra option. There’s a real gap in the market for products that are available to a showroom retailer and aren’t sold on a website. What people really need are products that are protected from somebody quickly Googling it and seeing how cheaply they can get it elsewhere, and also gives them a margin that reflects the work that they’ve done to shift the product.

We won’t be the ones selling our bathrooms, it’s the retailers. So this is a product that, for the first time in a long time actually really fits their selling process.

But it’s still a very competitive market to launch into?

It’s maybe a tad controversial but how many end consumers really care about the difference in specification between one basin and another? I don’t think they really do. You can sell ‘Joe Bloggs Basin A’ to a retailer and you sell ‘Joe Bloggs Basin B’ to an online dealer, but consumers don’t type the model number into Google, they type in ‘Joe Bloggs Basin’. When they do they see they can buy them online, and that is to me the big issue.

I don’t think brands are as powerful as they’d like to think they are when it comes to sales through a retailer. It’s the retailer who does the selling, right? And, to me, that’s what our whole pitch is based on. It’s the importance of retailers and it’s that fact that they need something that protects their sales. 

Did you consider distributing a known bathroom brand?

I don’t think we would say no to brands when this becomes successful – we are in discussion with some at the moment, that’s not a secret. But why does a retailer purchase any brand or product? I think nine times out of 10, it’s not because of specification differences but because of the support they receive.

Rob Taylor – sales director

Waterline

In contrast to the comparatively new Michael Marriott, sales director Rob Taylor has been with Waterline for the past 39 years. He has been instrumental in the company’s first bathroom offering…

“We are a barometer for the kitchen industry because we supply so many people, so I can say that I think it’s currently the most challenging market I’ve ever worked in. But in every challenge, there’s an opportunity, isn’t there?

“On an average month, we’ll deal with around 3,500 businesses and I reckon 80% of the people that we deal with in the UK are kitchen and bathroom retailers. We know the bathroom market is incredibly competitive but we don’t want to be the biggest bathroom distributor in the UK, we just want to sell to our existing customer base that like Waterline and like dealing with us.

“If you ask a bathroom retailer to name the biggest problem in their business, then people purchasing stuff online will be right up there, if not at the top. So we’re trying to give people an offering that when they put it in a quotation, customers can’t go and search for it online. We’re about investing in bricks and mortar businesses.”

We’ve spent 39 years perfecting the service we give our customers. So, for bathrooms, getting that service right starts with our own brand because we can control the after sales and whether or not it’s sold online. I think we can build on the bathroom offer once we’ve got that right.

Distribution in general is seeing a lot of upheaval, has the role of it changed? 

I think distribution is and always will be a very low margin business. KBB distribution has survived for as long as it has because it’s not easy to move these kind of big boxes around the place with something that’s quite fragile on the inside.

That being said, there are manufacturers out there that are getting to a point where they can do that with genuinely impressive third-party logistics. The trend we’ve seen over the past 10 years is that it has to be more than just moving boxes. If all you’re doing is buying in stock and getting it from A to B three days a week, that won’t be enough to maintain your business with retailers and suppliers.

For example, we’ve invested in having as many sales reps as possible out on the road so that we can get the messages out there and provide the retailer the level of support they need.

In some cases, we actually have our sales reps go out on the road with reps from the manufacturers, just so we can give them that level of connectivity with retailers. So when you talk about distribution changing, to me that’s what it’s all about. Just moving boxes from A to B is a dead industry now. 

The idea of a service-driven business rather than a price-driven one is the underlying principle of most kitchen or bathroom independent retailers?

Yes, for a new retailer it’s very easy to get stuck into the idea of chasing prices because it’s probably the first thing everyone goes to when they want to compete for that extra sale. But I think the retailers that are the most successful, and have been around a long time, are the ones that realise they really trade on reputation. Why do you go to an independent? It’s because they are going to give you a complete solution, handling the whole project from beginning to end and they’re trusted.

That’s no different for us, if somebody comes to us looking for the very cheapest product, maybe we have the solution, maybe we don’t but that’s not going to form a very long-term relationship between us and the retailer. What really does that is giving them the best level of service and, as a result, we enable them to offer the best level of service to the end consumer.

What’s your view of what the business will be in five years with you in charge?

I’d like us to get to a point where we are bringing out new services that save retailers material amounts of time. For example, not just curbside deliveries but taking it into the customer’s home and unpackaging it, or smoothing the remedial process with on site requests.

All these things are small incremental factors that allow us to improve upon our service and, again, in turn help retailers improve their offer to the end consumer.

Home > Indepth > The kbbreview Interview: Michael Marriott | Waterline