NAGASA - The Compass - Winter 1998

Study Focus: Assessment & Direction by Dealers & Manufacturers
The Means of a True Partnership

Two studies done by NAGASA provide interesting insights into the relationship between dealers and manufacturers. Surveyed in 1997, the results are documented in two reports in the NAGASA Distribution Statistical Series, as well as NAGASA White Papers 8 and 9. Some 76 dealers and 92 manufacturers responded to questionnaires, which solicited responses to similar questions, and views of similar issues, from both ends of the channel.

Both studies show that while manufacturers and dealers value their relationships with one another, both are troubled by various aspects. Dealers expressed concern about the profitability of the products they handle, while manufacturers were troubled by what they see as a lack of loyalty on the part of dealers. While dealers foresee a future in which they handle the products of fewer manufacturers, suppliers are concerned about the ability of dealers to deal with technology products and to represent them adequately to end users.

Only half of the dealers polled take advantage of manufacturer sales training, and only slightly more than half use cooperative trade show exhibits as a means of promoting manufacturers’ products. Of course, not all manufacturers offer sales training, nor do they provide trade show assistance. Still, manufacturers perceive that dealers, by not taking advantage of the programs that are offered, are somehow disloyal and indifferent to manufacturers’ needs in the marketplace.

As much as dealers and manufacturers disagree, they agree remarkably about the most important factor in their relationship: that the ability to increase sales is used by manufacturers to judge dealer worthiness. Financial strength and creditworthiness was ranked second by dealers and third by manufacturers.The willingness and ability to serve as local advocates for products was ranked second by manufacturers and third by dealers.

The reputation of the dealer among printers and trade shops, while ranked fourth by manufacturers, was put in ninth place by dealers themselves. Dealers, on the other hand, saw depth and quality of dealer management as the fourth most important factor in the eyes of manufacturers, while the suppliers put dealer management seventh on the list. Manufacturers also saw willingness of dealers to invest in sales and service training as the fifth most important factor, while dealers viewed it as seventh.The unfortunate aspect of these answers demonstrates that manufacturers see dealers as customers and that dealers see manufacturers as suppliers. Neither side sees the other as partners. These attitudes must change on the part of both for the manufacturer-dealer relationship to reach to the next level -- that of true partnership.

Contact NAGASA for a free copy of White Papers #8 and #9.