Distributors as business competition

[Sarah Beckett MCPF]

I am just curious of other framer's thoughts.

There is a local moulding distributor that has been around my locale (within an hour away) for as long as I can remember. Within the last two years their sales reps have become more aggressive for sales with artists and photographers as well as of frame shops. I know i have lost a couple accounts because of this, and one rep has pestered a good photographer customer of mine who has been told I am her framer and that will not change. She was asked, "why pay more for framing when you can buy directly from us?"

I have taken down their samples a while ago and stopped ordering from them, though I never contacted them to explain why. A situation came up where I have to order a frame to match. I decided to place the order, but also decided to talk to the owner. After explaining my reluctance to use them, the owner kindly listened then explained his point of view. After asking which customer was bothered, he said he would take care of that immediately. (And he did. He cc'd the email.) He then went on to explain that with the economy and the decline in our industry, that their sales team needs to be aggressive in sales so they stay in business as well: describing it as a double edged sword. So that customer will be left alone, but everyone else is fair game.

It is difficult for me. They are good at customer service, good enough quality material. Local. A PPFA supporter and chapter sponsor. Sadly, this is not how I wish to be treated by a vendor. I can not compete like that and I need customers to survive as well. I decided to be in retail, not wholesale. Why does this distributor get to blur the lines and cut me out?

I do believe there are two other local moulding distributors that have the same policies, it just hasn't been so blatantly in my face.

Is this something to bring up at chapter level meetings? Do other framers deserve to know their policy?
Am I just causing issues?

I am curious how other framers feel about this subject.
-Sarah

 

[Cliff Wilson MCPF]

This is a version of "vertical integration."
Given enough volume, you could source moulding from a manufacturer for instance, which would be the same thing.

I expect to see more and more vertical integration due to the contraction of our industry.

Retailers will lose some customers from this activity.
We have the ability to offer services and knowledge the distributors would have trouble offering, but that won't always be enough.

I believe it will not really be cost effective for them to try to serve a lot of little customers in the long run.

The practice itself will not cause me to buy or not buy, but aggressive behavior as you describe would make me curtail business with them.

Mostly, I buy from a vendor because they offer me a product I like, at a price I can make money, with sufficiently good service that they stand behind that product. If I have to compete with them in some parts of my market, so be it.

 

[Kai Vanuffelen]

There are a number of potential customers who think price is the most important factor when it comes to deciding which framer to choose.
I see you are an MCPF and assumedly your distributor/ competitor is not. Try to advertise on that basis. You deliver a quality-product and service because you are qualified and for that the reason, your framing can be more than at nearby competitors as a justification.

When it comes to service from my suppliers, that is very important to me.
I like it, when I get an email stating that the supplier has received my order and another that the order has been picked up by the courier with the following tracking number.
Instead of having to chaise a certain supplier after a week and asking why my order has not arrived yet. Oh, I did not receive your order, can you please resend it.

 

[Andrew Lenz Jr.]

I'm with you, Sarah. This would REALLY bug me and I'd likely start looking for another supplier. I have one moulding manufacturer about six blocks away. Their policy for selling to folks is too loose for my liking (no business license required) and, consequently, we buy maybe six sticks of moulding per year from them. If they didn't compete with us for the local artist framing market, they'd like be one of our main suppliers. At least our quality is better---their wholesale frame assembly is less detailed---but nonetheless, it's a somewhat uncomfortable situation for us. I've talked to them about it, but they feel it's in their best interest to continue to sell to those types of customers.

Andrew

 

[Susan Gittlen MCPF]

Sarah, I feel for you and I think most of us are in the same situation with some supplier. I think that our energies are best used in concentrating on our own businesses and how to make them better. In my opinion, I don't think that it would be right to discuss this at a Chapter level. There will always be indies, big box, home shops, and suppliers like the one you mention. They are all in the framing industry and shouldn't be judged because they want to do business a certain way. Just my opinion. I would make friends, you never know who they might send you.

 

[Robin Gentry MCPF]

I tend to agree with others that unfortunately this has become part of the business. I do not agree with the hard sell. If the business tells them they are your customer then the rep should understand and back off. Just my opinion but it will hurt the distributor if this continues. I would not point it out at a CL meeting but if ask I would state my reasons for not using that distributor.

Robin

 

[Russ Wood]

My local distributors require their customers have a sales tax license. They also have minimum order quantities. They sell frames assembled, but do not fit, cut mats, etc. Their business model is to sell higher volume and little end consumer service. Their primary customers are framers, retail art and craft stores, higher volume galleries, etc. And they treat me great.

For artists and photographers that have a sales tax license, and do not want or need design services, or the complete package services that we provide, I feel it is okay for them to buy from such distributors. First, I want my local distributor to succeed because I want them around so I can buy my glass, mats, and framing hardware / misc. supplies from them so I don't have to buy elsewhere and have to add the freight cost. Second, If these customers are buying only on price, I would probably not get their business anyway.

Part of my model is to carry some frame moulding in length. I only buy, generally, moulding from my local distributors for specific orders, not length. I get my best prices by going direct to the moulding supplier that is not carried by these local distributors. Yes, I have to pay about $0.25 to $0.30 per foot for shipping when bringing in say 100 feet or more, but when I can get really good prices for length, an additional $0.25 or $0.30 is better than similar moulding from my distributor. And I don't have to sell the exact thing everyone else has, but I have the option.

A bigger artist pricing issue for me is a local framer that brings in nice ready made gallery frames by the pallet. And he sells them, frame only, to the local art school students. (Really, this is a nice service he offers). He sells them for less than I can buy them for. One of my artist customers brought me an invoice to confirm this. I spoke with the rep, and she confirmed that his pricing is really low because he is bringing in 300 to 500 frames at a time (he gets better prices on those than the local distributor).

So, my artist friends / customers bring me in their artwork, and their "gallery frame" from the other framer, and I fit, cut mats, etc.

Life is too short to worry about things I can't control. So I just try to figure out a way to have it work out good for me too. For example, if your distributor is aggressively taking some of your customers away, approach the distributor and discuss options. And tell them nicely that you like doing business with them, but because of their activities it is causing some friction. Then ask "would you be willing to offer me an additional 10% discount on all of my mat purchases, to help offset some of my concerns? How about 10% on all moulding too or all supplies, etc." You get the picture.

 

[Jim Miller MCPF GCF]

Competition from suppliers has probably cost me an average of about $20,000 of revenue per year in the past five years, and the loss continues to grow. My initial reaction was to try to stop buying from the suppliers competing with me, but that is a futile strategy for a couple of reasons. They're all doing it, and diverting orders to suppliers out of the area would increase acquisition costs, such as shipping. Also, those suppliers are probably competing with the custom framing customers in their own areas, so the net result would be higher costs for us, and no real loss for them.

My strategy has been - and remains - to promote the types of framing that my main competitors do not or can not provide. That is, I go for preservation framing and object framing that my competitors and suppliers are not able or willing to do. I like to think of it as 'taking the high road', but the air's getting a bit thin up here.

 

[Gregory K. Norris CPF]

Amen, Jim.

 

[Cliff Wilson MCPF]

...My strategy has been - and remains - to promote the types of framing that my main competitors do not or can not provide. That is, I go for preservation framing and object framing that my competitors and suppliers are not able or willing to do. I like to think of it as 'taking the high road', but the air's getting a bit thin up here.

With certain location exceptions that have very high affluent demographics, I think this is a great strategy to drive a business toward retirement. If you want to minimize your work load and maximize dollars/hour worked this is a reasonable strategy. If you're willing to put a little effort in and you want to maximize gross revenue and gross income, I think it's a mistake.

Although each location has unique characteristics that must be taken into account, most of us could go after the breadth of the market and win.