mark-led-light Posted August 5, 2013 Share Posted August 5, 2013 Hi Everybody, Just been wondering what people think about the way the lighting industry is changing for better or worse, would like to know is this good for our industry that lighting distributors with many exclusive product lines are now running special projects or installation departments!! Is this fair that a lighting company may have to tender against a lighting distributor to be awarded the contract, knowing that the distributor will most probably win the contract much easier, as they have bigger margins to play with and they know what we are paying for the same products. Would like the blue room to have a sensible discussion about this.... Look forward to your comments!! Link to comment Share on other sites More sharing options...
ImagineerTom Posted August 5, 2013 Share Posted August 5, 2013 this isn't a change, this isn't something that's /now/ happening; when I entered the industry in the 90's the huge main distributors sold direct / installed direct and sold to resellers, Link to comment Share on other sites More sharing options...
J Pearce Posted August 5, 2013 Share Posted August 5, 2013 Going back even further Strand Lighting (and others) used to make, sell and install. Link to comment Share on other sites More sharing options...
Grum Posted August 5, 2013 Share Posted August 5, 2013 As has already been said, this has been normal business practice for a very long time. Whilst it's true that the big companies can undercut their smaller competitors by selling their products at lower prices it is also fair to say that, because of the lower margins, they are less interested in the smaller jobs. These smaller jobs tend to get picked up by the smaller companies as those companies gain more work they get bigger and, once they are able to sell enough product they end up with a distribution deal of their own. Having worked for a distributer in the projects dept I know how much work it takes, big projects often have several people just working on the CAD, then there's the staff in the workshop, warehouse, logistics, project managers, sales not to forget the back office staff to deal with such a large workforce or the actual installation teams themselves. Small companies often can't handle the sheer scale of work that bigger projects require. Another bonus for the client is by using a distributer you get access to the manufacturer and, if your order is big enough, you can get certain extra features just for you. For example, the distributer I worked for did a lot of installs for the BBC who had their own preferred dimming curve we were able to get the manufacturer to include this curve as an option in the firmware for their dimmers, smaller companies simply can't do things like that. Link to comment Share on other sites More sharing options...
GR1 Posted August 5, 2013 Share Posted August 5, 2013 This has been going on since the industry was invented - nothing to discuss here. Link to comment Share on other sites More sharing options...
kerry davies Posted August 5, 2013 Share Posted August 5, 2013 The Art of War by Tsun Tzu is your template in these things.The big boys have many things on their side but their size makes them less responsive, less able to react instantly and reduces their flexibility, these are the tiddlers strengths. Where a distributor has to offer the product he is allied with the tiddler can offer a host of alternatives. The manufacturers and distributors are restricted in that if they don't make/supply what the end-user requires they are stuffed, the tiddler is not. It is quite normal for a sole trader to be competing successfully with the big boys until they grow into an established business themselves. Often enough they become agents for a range of kit and often grow into the very same big boys that they once competed with. In rare cases they end up manufacturing what products they cannot locate or source at reasonable cost and become really big players. Bunch of dope-smoking Danish hippies became Martin. Opti started as bunch of guys with a heap of school surplus Rank Tutor 2's. That's you that is. Or could be given one decent idea and oodles of work. Link to comment Share on other sites More sharing options...
musht Posted August 5, 2013 Share Posted August 5, 2013 Phrase `exclusive product lines` stands out ,distributors have well trained shoals of sharks in suits able to offer advice only out of the catalogues they are handed. If one of the `exclusive lines` isnt an ideal fit, they`ll make it fit or sound as if it will. As an `independent` can offer a product chosen to fit the clients needs from the whole range on the market. Larger margins and larger overheads with said sharks and backup to keep fed, large customers get that way by getting substantial amounts of free credit from their suppliers, bigger they are the slower they pay, rotating amongst suppliers until they really have to pay. Link to comment Share on other sites More sharing options...
AHYoung Posted August 5, 2013 Share Posted August 5, 2013 I don't see the problem, big companies will have an advantage over smaller ones due to buying power, but also much larger overheads and a need to be consistently busy thus inflexible. Distributers often piss off the middleman by going straight to the customer, but that's life unfortunately Theres also the situation where the manufacturers will give pricing to the end user and therefor set the margins available, but what are you going to do? its either worth your while or its not, Where you as an smaller installer should score is by offering added value ie closer attention and better / quicker service and turnaround. its easy to win work on price and currently there are a fair few doing just that, but if you establish your own customers, there shouldn't be an issue, as ultimately the manufacturers want their product installed and will ensure that the installer gets the pricing to make that happen no matter how their route to market goes. Link to comment Share on other sites More sharing options...
mark-led-light Posted August 9, 2013 Author Share Posted August 9, 2013 This has been going on since the industry was invented - nothing to discuss here. This has been going on since the industry was invented - nothing to discuss here. Obviously nothing for you to discuss!!! Thanks to everybody else for their comments!! Link to comment Share on other sites More sharing options...
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