Distributors Pick Up the Pace
Only a few years ago, it was a given that distributors were the primary equipment supplier for the security industry. However, with an increased demand for digital CCTV products, the practice of manufacturers selling direct to dealers and integrators, and the rise of smaller independent distributors, the distribution industry has been forced to become even more responsive to security systems contractors’ demands.
Most in the industry agree that there are advantages to using distribution. A dealer can keep its on-site inventory to a minimum because the distributor can usually deliver products within 24 hours. Product expertise is another big plus. Additionally, distributors provide access to a wide range of equipment, reducing a dealer’s/integrator’s need to shop at multiple vendors.
That said, issues such as fluctuating prices, training and customer service remain at the top of many dealers’ complaint lists when they speak of distribution. The good news is that distributors are listening to their customers and continuously making improvements.
Fluctuating Prices, Inconsistencies Frustrate Integrators
When asked about distribution, Grant Thayer, vice president and general manager of Radar Security Alarm in Winston Salem, N.C., says, “Pricing is never the same unless you talk with the person who handles you on a frequent basis. It sure makes one go over each and every invoice to make sure things are correct.” Gary Powers, vice president of Lassco Sound in Salt Lake City, agrees. “If we negotiate a special deal because of a total number of products, sometimes that pricing is not reflected.”
Most distributors say that pricing inconsistencies are kept to a minimum because their customer information, as well as pricing, is computerized.
According to Frank Mastrolonardo, vice president of sales for Houston-based Richardson Electronics Security Systems Division, “Everybody is on the same computer system, so if a quote goes in for a specific customer, their account number is logged, then that quote would be seen by anyone in the worldwide Richardson organization. So, if they call the next day and talk with another guy who pulls up their account, he’s going to see their pricing.”
Bob Van Dillen, president of St. Louis-based Security Equipment Supply (SES), adds, “I think those distributors that are established and successful, like ourselves, have gotten there because they treat their customers fairly and consistently with pricing and support.”
Randy Hall, president of The Systems Depot in Hickory, N.C., agrees and says, “If we’re going to have a good relationship, we’re going to customize our package for the client so they won’t experience that problem with us.”
Henry L. Homrighaus Jr., vice president of marketing and sales for Security General Int’l of San Antonio, does admit, “When you get to be a certain size with all of the outlets we have, there is occasionally some confusion. By and large, we control that through our software. The system is not perfect, but it has come a long way in resolving these issues with dealers.”
Additionally, according to Michael Flink, vice president of marketing for ADI of Melville, N.Y., “Price variances can sometimes occur because of volume discounts. A customer who buys large volumes of a specific product could get a better price on that product than a similar customer who buys significantly fewer pieces of that same item.”
Price differences can also sometimes be attributed to something as simple as a customer calling and not identifying himself, as well as the distributor representative not asking. When this occurs, distributor personnel aren’t able to match the customer with his or her discounted price that may have been previously negotiated.
Sometimes a manufacturer may require a price increase. When this happens, the distributor must pass it on to the customer. Both dealers and distributors agree, however, that when a pricing error is made, distributors are very good at correcting the problem immediately.
As Always, Personalized Customer Service Is Crucial
It is human nature for someone to want to feel appreciated, and this is no less true of security systems contractors. According to Mike Martin, president of Martin Security in Green Bay, Wis., “If you do $250,000 of business with somebody, there should definitely be some personal outreach; having people communicate to you that they are really happy you’re doing business with them.”
Joe Petrillo of Security Design Systems (SDS) of San Gabriel, Calif., adds that his company wants regular updates about new products and technology. “[Distributors] need to have people who talk with their dealers weekly and keep them advised of all of the new equipment that is coming out. When we get a distributor that has a particular person who does that, we love it and consistently go back to them. We have a couple of companies that we’re doing business with that have very talented people and we’ve locked on.”
Many distributors encourage their employees to develop good personal relations with their customers. In order to provide better customer service, Richardson Electronics recently made several changes in its senior staff. “We initiated the regional system specialist [program],” says Mastrolonardo. “Our regional managers are out in the field and we really work closely with [dealers/integrators].”
E-mail newsletters (like those from SES) that provide product updates, as well as job leads (like those from Security General Int’l) are other ways that distributors provide improved service.
Security Systems Contractors Want and Need Training
Product and lead information isn’t the only thing security systems contractors look for in a distributor. Very often, distributors are a dealer’s main source for training, yet some feel that they are not providing enough educational opportunities.
“I can sell more product if I know how to use it,” says Martin. “If I don’t understand how to use a product, I may not buy as much of it, or go to a different distributor that’s more educated on it and buy it from them.”
With technically intensive equipment, Lasco Sound usually goes directly to manufacturers for training. “Generally, [distributors] don’t deal with really sophisticated systems. If they do, it’s pretty much on you to figure out how to use the product,“says Powers. For many dealers, however, the training distributors provide is appropriate for a given installation’s level of technical intensity.
Many distributors offer manufacturer training at their branches. Some admit, however, that they occasionally experience smaller-than-expected attendance by dealers. They attribute this to manufacturers not requiring dealer attendance. Additionally, security systems contractors’ schedules often require they be called away at the last minute. As a result, distributors are constantly refining their training processes so they are most attractive to dealers.
“We do try to limit our training to educationally approved events, where attendees can get credits toward continuing education for licensing,” says Hall. “We also try to keep training focused on new growth and/or profit opportunities.”
Indeed, licensing requirements are powerful incentives for dealers to attend training. In states such as Texas, an installer must maintain his or her license by attending continuing education classes. So that its dealers can meet these requirements, Security General Int’l offers 21 hours of sessions on topics such as ethics, sales, planning, application, CCTV, residential and fire.
Most of the training sessions provided by distributors are free of charge and – in the case of ADI and Richardson – are part of the companies’ expo programs. Training at distribution centers can
be brand-neutral and focused on licensing requirements. It can also be sponsored by manufacturers for new product and technolog
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