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Re: Merloni
Here’s my take on some of this for you…
If I wanted to expand the business, even by one engineer, then I have costs to face in training the guy, getting him a van which will be on a three year deal at best and stocking that van out.
Fag packet calculation states that that will cost in the order of £5-7K plus the ongoing costs of salary and the van etc. Now, even if that guy completes 40 calls a week making £7 a call the payback time is roughly about 18 weeks at full capacity not including the ongoing costs of running the engineer which would stretch that out considerably.
That in itself is not so much the problem, the problem is when you have to get rid of them as the work leaves. This I KNOW is an issue and the very reason that LGS closed its doors. Has we been able to cut back the staff then we could have weathered the storm, but to get rid of staff is a very expensive business without gross misconduct and still you have the ongoing costs of the van and then the stock which will no doubt be non-returnable.
Let me shed some light on that last bit, in LGS when we closed it, we had in excess of £100K’s worth of stock at cost value. In the end it was valued at less than 10{e5d1b7155a01ef1f3b9c9968eaba33524ee81600d00d4be2b4d93ac2e58cec2d} of that figure as spares are only worth something if someone wants them. Finished goods have a far better chance of being sold on, spares you have no chance so whatever value you think you have on the shelves is, in actual fact when it comes to the bit, worthless.
So you have a contract with a 3 month termination, a low profit margin and stock you’ve had to pay for that is worth Jack Shit. Still sounding like a good deal?
When you take on a “franchise” or “agency” in other businesses you have a designated area of operation, back up through advertising campaigns, guarantees that no-one else can sell the same product in your areas and signwriting/uniforms provided free or at a massively reduced cost. Look at Dyno-Rod or any similar type operation, but they charge mega-bucks and in that line of work can afford to, we cannot.
So, how do you solve that problem?
Easy.
We accept that we cannot be paid at those kinds of levels, the industry does not allow for it frankly and therefore we accept the reduced labour rates that we get and the zero up-front costs on obtaining the agency. However, training and promotional materials as well as support to promote the business should be provided at little or no cost to us, just as is done partly by the likes of Service Force.
This does two things, it cements that the business approaching us to work on their behalf are committed to supporting us and are committed to the notion of using a third party agent as well as not being able to switch agents on a whim. It forces the manufacturer or WP to commit financial resources into building a loyal network of repairers that will in turn support them properly and look after their customers, so they gain as well.
For a major manufacturer this is not an issue and should actually be a matter of course. Currently it is not as we all know, we have to change that way of thinking and get ourselves a better deal and secure our futures.
As you can see, this is easily achievable without burning any bridges at all, but if the likes of Merloni do approach you, you can now see the sorts of things that you should be asking for in addition to a rate that makes it worth doing but also securing the work for some time. It is easy enough to look at the figures and simply state that you’re sorry but you cannot make it work based on the deal on the table but if things change please come back to me. I have done this and will continue to do so and continue to pick the cream of the work thank you very much.
After all, if they ask us to commit and take risks to service the contract why the hell should we accept that with no risk or commitment from them as we have been doing? By taking a mealy-mouthed approach as you suggest Jason (no offence intended) and not stating your case only serves to perpetuate this situation that we’re all in now. It really is very simple, we set standards that they have to reach or we don’t do it or commit OUR MONEY, time and resources to it. Why should we with nothing in return?
Right now and, for the past nearly two decades our predecessors have allowed these twats to get away with this shit, we need to change it. But it was a different world back then, things have changed and we need to change with them in order to survive beyond the next few years and this is vital IMHO.
See, there are ways to do this and quite easily as well, we just need to work together towards some common goals.
K.
Re: Merloni
NOT YET CONFIRMED
Merloni withdrew from nesn as their network was not strong enough to do the work without training.
Nesn were allowed to spin their way out rather than publically say our network is not up to the task.
kevin
I agree whole heartedly Ken, we do need to stand together firmer, and then we can be more comitted to the cause. We will not win alone but together we stand more than a fighting chance.
And no offence taken
J
Kevin , I don’t know where you heard that, But I actually assisted in pushing NESN into withdrawing from the trial with Merloni. (With my persistant complaining).
The call information passed was of a very poor quality .
No tecnical advice available. ( Fault codes /diagnostics etc).
No spares a/cs set up.
and no contact /customer care information available for exchanges.Between Tuesday and Thursday I sent Clare Piercy 4 e- mails and made 5 phonecalls about the above subjects. On late Thursday afternoon I had a phone call from the new sales director (?) apologising and telling me thay had suspended the work as of that evening. It was causing too many problems for them and the other 10 or so agents doing the trial .
Meanwhile if Merloni were not happy why did they e-mail NESN 150 jobs today and why are they sending grovelling e-mails for them to start up again.
Them Merloni boys sure are desperate !!!!
Philip
Re: Merloni
Excellent! 😀
I love it. Soon enough I don’t honestly think that they’ll have much option but to give in and capitulate to some degree.
We’ll see, it’s all politics now.
K.
Re: Merloni
hi phil,
It appears there was never technical/spares or any other sort of back up on the table with Merloni. Nesn went into this knowing exactly what was on offer, fraid they are being economical with the truth now. The work was always temporary lasting until xmas at best.
You should ask why a) Nesn are “trailing” temporary work b) and where the projected 44,000 calls are coming from.No-one will argue that Merloni are desperate, but the Nesn cause is not helped by several in their network refusing to do any work with a merloni badge on it. Theres more to this and as ken says its very political now…..no doubt the end result wont suit everyone, but if we play our cards right and refuse the work directly, we will force the price up with the correct deal through a work provider. Giving those who do the work much greater protection than is apparent now. As you are at the moment, exposed to the Nesn shortcoming of poor payment etc, no help, no back up, not even the truth when you need it.
Think on it phil, are you doing yourself any favours doing this work with such poor support?
one thing is for certain phil, nesn were pushed not the other way round.
kevinRe: Merloni
JHuby wrote:
When colleges say they will not work no way no how with a manufacturer or work porvider , I personally think this is a bit short sighted. None of us should ever burn our bridges as you never know just what is round the corner.I take it from that you would have little hesitation in taking Merloni back on; surely I read that wrong??
I don’t like burning bridges either, however Merloni nearly bankrupted me. When I found I was losing £2.10 per call I had an emergency meeting with Neil Taplin. He told me before that meeting that I needed to employ a different accountant. When we got together I ran my figures past him, pulled out a few stats on Excel and he admitted we were losing on his contract. During that meeting his colleage asked me to take on extra postcodes. What they failed to grasp was, the more work I done for them, the more money I lost.
As most people know, Merloni took the action themselves with the agents, the same agents that were subsidising them. In some cases the work stopped almost overnight, and in most cases it left businessmen like us over resourced. In extreme cases it forced some agents to set up a dialogue with the likes of NESN. Out of the frying pan into the fire maybe.
Candy took a slightly different approach, in that case we all saw the writing on the wall. They gradually phased us all out, yet prendending this was not actually happening.
Basically, I cannot give a shit if these companies are now floundering, in as much as they couldn’t give a shit when we were floundering. Now they think they can come crawling back, Oh Yeah!
We are still suffereing the effects of Merloni and unless the figures equate to the levels that would redress the balance, Bollocks to em!!
That was passionate this time of the morning, I’m now off to beat some engineers.
Alex
Re: Merloni
Some of us take the view that “shit happens” so just dust yourself down and go with the best deal you can get. Whilst others, after having given 110{e5d1b7155a01ef1f3b9c9968eaba33524ee81600d00d4be2b4d93ac2e58cec2d} to a particular manufacturer and lost money hand over fist will never go back on principle.
We are all in buisness to servicee appliances and provided the work comes from a reputable trusted source with all the required safeguards, and technical support and most importantly at the right money their is no good reason that we should not do it.
But to take it on at any terms as Phil has just found out is quite simply not worth the grief. Some of you that never did the work before may be supprised to learn that members of this very war room still have mountains of Merloni stock that the bastards refused to take back and credit.
Alex there is no point in staying angry with Merloni, they dont give a shit if your angry or not and could’nt care less. The best answer is not to get angry but to get even, by makin’ the bastards pay through the nose for the work they want done.
They have already offered £37 through NESN, without any serious takers so when they get desperate enough due to the pressurse that the insurance companies and retailers are putting on them to improve their service levels and they have to go back to CDSL. lets hope we can all jump in for £40 a call, with at least 2 years work and the knowledge that we can return any unwanted stock. Because if we dont then you can bet your life that plenty of others will.
Del
Re: Merloni
Whilst who pulled the plug on NESN or Merloni is interesting, it is pretty much irrelevant from where I sit. Personally I don’t give a shit, fact is that we and the other guys didn’t get shafted again and I regard that as a result in itself. However the situation is further improved by the fact that Merloni are now really out of options.
To get any work done outside their own employed labour force they will have but two real options, go direct and lose face as they would have to offer decent money and capitulate on the spares issue, or use CDSL. I say CDSL as there’s none of the others out there that have the spares logistics setup to deal with something this size or the finances in place. Using another manufacturer is just beyond the pale for the Italians so that option’s out, the Italians would freak if it were even mooted I suspect.
Now, CDSL will hold them to an, at least, two year deal and wrap up the spares side as well, or that will be their goal at least and they’ll be looking to pay the troops £37-40 I should think with an increase on gas and other bits and bobs. Funnily enough you’ll note that the rate that NESN was paying was the same as CDSL more or less, I wonder why? 😉
CDSL will also insist on full technical support and backup as they know as well as we that without that this contract would fail and they’d get tarred with the NESN brush, so it has to be right.
However, I don’t think that forcing the work back to CDSL or any other WP will actually help in forcing the rate up all that much, we’ve pretty much done that already but now we have to raise the bar. If NESN were prepared to pay £37 & £50 then we should be looking for that at least direct with another £1 or so on top as they’re not paying a third party to boot.
ISDAL don’t want it, British Gas would want £70 plus a call, JTM and Servicenet couldn’t cope with it, NESN are already screwed and out the frame so there’s nowhere left for Merloni to go frankly. Additionally we’ve already put the skids under the franchise idea and probably done a fair old bit of damage to the NESN plan and they can’t get more engineers so basically, they’re screwed.
So that leaves us, the independents, to pick up the pieces and, irrespective of what path Merloni take now with regard to service, it’s going to cost them dearly. That I don’t think is in any doubt at all, the pertinent question is, how much will they pay and how badly do they want bailed out?
They may just be desperate enough to talk sense and, personally, I don’t think that this work should go through a WP, I think you need the support that only a manufacturer can give. But if the deal’s not right or secure enough then walking away and leaving them to fend for themselves would be my chosen course of action.
Things we should be looking for are…
2 year contract with a review at 18 months.
Annual rate review to rise at “at least” the headline rate of inflation
Technical information CD/DVD provided FOC
Van livery provided FOC
Contribution towards workwear
Sponsorship (to an extent) of CORGI training costs
Initial stock on 12 months sale or return, with no quibbles, payable over 6 months thereafter
Projected call levels and the guarantee that it wil not fall below a pre-set level
Clean stock returns system, authorised by a area service managerNow, I know that that lot may seem like wishful thinking, but have you ever asked for it? We had all that in place under the Zanussi regime, why can these pillocks not do it as well? That level of support can only be offered directly by the manufacturer, it could not (I don’t think) be done through a WP or if it were it would be horrendously expensive to maintain. Remember, this is volume work for a manufacturer not some Mickey Mouse operation and the level of support to give that manufacturer the loyalty that he wants has to be right.
It is time that we brought these people into the real world and, should they not wish to play ball then fine, let them limp along or pay the rates and suffer the terms imposed by the WP’s.
K.
Re: Merloni
As we are an official Hotpoint sales centre, I’ve emailed our rep this morning pleading ignorance and asking what the fuck is going on (rumours etc ;))
As if I didn’t know already 😆
Let’s see what the sales side of the operation has to say 😀
Dave.
Re: Merloni
Del wrote:Some of us take the view that “shit happens” so just dust yourself down and go with the best deal you can get. Whilst others, after having given 110{e5d1b7155a01ef1f3b9c9968eaba33524ee81600d00d4be2b4d93ac2e58cec2d} to a particular manufacturer and lost money hand over fist will never go back on principle.
Alex there is no point in staying angry with Merloni, they dont give a shit if your angry or not and could’nt care less. The best answer is not to get angry but to get even, by makin’ the bastards pay through the nose for the work they want done.
Del
Not angry, I was looking for an interesting debate. Regards Merloni, there wasn’t much room in their system to get even as it were, not as long as I was an agent: and of course I terminated them.
I just think it is a case of what comes around, goes around. Had they looked after their better agents and of course that includes Jason as well as Del & many others, then they would not have had such a big problem.
I suppose I’m lucky in as much as I’m in the position where I can pick & chose my work providers. At present I could fill 2 more engineers happily, and have overflowing work schedules. Pehaps I should give Technics 1200 a tug, but he’s to far away.
Alex
Re: Merloni
As stated by Alex on th eHotpoint thread, OEM service is crap, has been for awhile now and it’s a trend that looks set to continue for the foreseeable future.
There’s room there for us to profit by that I think, but it will take some time to address the issues given that, if they won’t invest in their own infrastructure, what makes you think they’d invest in ours?
Time and time again it has been demonstrated that poor service affects sales, it’s a simple link and the two are symbiotic, without one the other starves. Where we’re at now is that sales has gained too much control throughout the entire industry with little or no regard to aftersales service or the retention of customers. Electrolux, to their credit, learned that very quickly after the debacle with the Zanussi agents and are still paying for it to some degree (AIUI politically) with the loss of the DSG work to CDSL. Others such as Merloni, Whirlpool and GIAS have yet to learn the lessons from that history.
We’ll see.
K.
Re: Merloni
Perhaps we should come up with a list of safeguards we would all wish to see in place in case this Merloni work comes back at us under another banner.
The strange thing is that when something works well, nobody mentions it.
MFI work is a typical example of what I mean, £40 per call 10{e5d1b7155a01ef1f3b9c9968eaba33524ee81600d00d4be2b4d93ac2e58cec2d} mark up on spares and not one mention of any major problems with the work on any of the forums. In fact as far as I’m concerned the contract has run as smooth as as a silken codpiece (There, my secret is out at last 😉 )Could it be a complete coincidence that this particular deal was brokered by the guy’s within this very room who did shit loads of work behind the sceene’s and handed over work directley to agent’s without first hiving off the all cream for themselves unlike every W.P. in the land.
Might it be an idea for us all to get our heads together and do a repeat of the MFI deal with Merloni.
Of course we would have to agree a pact of solidarity of.. One for all and All for one. To hold the buggers in check.We all know that Merloni want to keep control of the spares, but apart from NESN every other W.P. would want to run the spares as this is where most of their money is made. Sometimes it’s just a case of being in the right place at the right time.
Thoughts Please !
Del
Re: Merloni
Sod it, vodka, popcorn and “24” doing my head in.
Now this is a big WHAT IF but, what if we can get enough people to sign onto acting as a “buying group” , after all there are buying groups in all sorts of areas, is there any difference in what we do? I don’t think so, therefore we’re not breaking any laws.
So what if we negotiate deals on behalf of the trade as a whole? It’s not really that far fetched really, I mean, as a group we virtually set the standard as it stands so this is merely an extension to that ideal.
I am not talking about unionisation, that would be a total falacy to pursue IMHO and inevitably counterproductive into the bargain as it would lead to unrest from some, so not a good idea. But if we were to try to enlist key people in key areas and stand fast for certain conditions to be met I think that we could, if not win outright, certainly make a huge difference.
I dunno, knock the idea about as with what I’ve tried to put in place here with the lead directors of UKW, the War Room Staff and the Advisory Council I think we have the aparatus to do it, but have we the will to do so?
In the end for me it comes down to this, I want to firstly protect my people and by default my liviliehood, then the rest of the guys out there, although that line is very blurred for me as I strongly believe that by protecting my own I also protect others, so for me the choice on what to do is simple. The more protection I can build in for my own the stronger my business is, by way of doing that I have to also build that protection in for others as well and I cannot do that alone. But if it is the consensus that we should proceed down that path I will gladly take it.
K.
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