3M Addresses Concerns Among Dealers Over NGSG DealAugust 13th, 2009 | Category: Industry News
Several window film manufacturers have announced alternate sales strategies recently and some of the dealers affected by these changes have begun to speak out.
On July 27, CPFilms announced the creation of an in-house sales specialist team to help find and win retail and commercial architectural projects. (CLICK HERE for related story) At its most recent national dealer meeting, Huper Optik USA unveiled plans for its dealers to provide an array of energy-saving products and services, in addition to the company’s window film. (CLICK HERE for related story) July 13, St. Paul, Minn.-based 3M announced changes as a result of an agreement with Dublin, Ohio-based National Glass Service Group (NGSG), in which it agrees to pursue all national retail accounts exclusively through NGSG. [CLICK HERE for related story) All of these cases mean change for window film dealers. And in the case of 3M, some of the company’s dealers have begun to question how the NGSG deal might impact their future.
In an email message dated July 16 to the company’s dealers, Charles Calisto, 3M’s national sales manager, said that it had come to [his] attention that the news “caused some to converse, to wonder, and, in some cases, to question what we are doing.” In his message, Calisto describes 3M’s market penetration as “miniscule at best” for the auto, residential and commercial segments and explained that the company needs “people on the street … pounding on doors” for all of its product segments.
According to Calisto, part of 3M’s strategy involves segmenting off areas of its business in order to develop focused strategies and tactics. The company’s arrangement with NGSG focuses on the commercial segment and specifically large retail chains.
Mike Spurlock, a window film salesman for Ken Caryl Glass Inc. in Littleton, Colo., offers mixed feelings about the arrangement.
“Overall, I think that more aggressive marketing and selling by the manufacturers directly will ultimately increase film sales for everyone involved,” Spurlock says. “Many of the smaller dealers either do not know how to pursue large accounts or, more often, are too busy owning and operating their businesses to dedicate a large amount of time to chasing larger potential clients.”
Spurlock says where some 3M dealers fear that 3M and NGSG will cut into potential sales in the commercial and retail segment, the reverse could be true.
“Sales reps for manufacturers will have a single goal: to sell film, and lots of it,” he explains. “That means they will work hard at marketing and selling, and will raise overall awareness of window film. Either the dealers will still ‘play catch’ and take the installation work sent along by the manufacturers, or they can join the fray and take advantage of the work being done by the manufacturers’ reps.” By this token, Spurlock says that 3M and NGSG will create potential customers who will likely want to shop additional providers prior to signing a deal.
“Once a building manager has listened to one person regarding film, there is a good chance he will want to talk to someone else in the field, if for no other reason than due diligence on their part,” he says. But he also says the good may come packaged with a few negatives.
“There are concerns of course,” Spurlock says. “The first that comes to my mind is, what if the manufacturer approaches an existing dealer’s customer?”
This is one of the concerns Calisto addressed in his message.
“To begin with, the contract written between 3M and NGSG favors 3M and its customers (you),” Calisto wrote. “It protects our ability to pursue our business as usual. Yes it states that 3M will use NGSG exclusively, but this exclusion relates to our ability to engage with another party (like NGSG); it does not preclude us (3M and you our dealer customers) from pursuing accounts that might fall under the same market segment described here and in the agreement between 3M and NGSG.”
John Susnik with Sunray Window Films LLC, a 3M dealer in Independence, Ohio, takes Calisto at his word.
“If Sunray® is working on a project which is a particular national account, NGSG is not allowed to go over our heads and take this job away from us,” Susnik says. “They have to mention this project to us and we have to tell them we are already in talks with this company and they will have to leave it to the local 3M window film dealer to close the sale.”
For those who had allegedly begun to “converse,” “wonder” or “question,” Calisto offered up the following assurance:
“I promise you this … if this relationship brings no value to you, then it will not last; if this relationship causes harm to our relationship, then I will dissolve it immediately; but I ask each of you to give this a good hard try.”