Power Channel Update

Filed Under (The Competition) by Don on 11-01-2007

I was informed today from a reliable source, that power channel player Office Depot is about to make another internal change that will again degrade their already suffering customer service abilities.  There is a department currently in place that, when needed, will go to the customers office for support and service for issues ranging from products to ordering problems.  This department level is being abolished completely and will no longer exist.  This further demonstrates the need for the power channel players to meet shareholder expectations by lowering costs and streamlining operations.  The big box stores have been rapidly consolidating their customer call centers in areas such as Colorado to accomplish this in part.  This means no matter what state or city the customers physical office is located when they call Corporate Express, Office Depot, etc., they are speaking to someone in a call center located in or near the mid west. 

Obviously when someone buys shares in a corporation they expect to receive dividends.  These dividends will not happen if the corporation does not continue to show a profit.  These big box, or power channel, operations cannot continue to sell their products at extremely low margins and generate dividends too.  I have said for years that it is only a matter of time before they will be forced to make changes in order to stay ahead of the independent dealer channel.  Cost of transportation, warehousing, personnel, brick and mortar store fronts and expensive advertising campaigns add up to some serious expenses.  These big box competitors have resorted to smoke and mirrors and pass-through dealers to get government contracts thereby defrauding the government and the taxpayers.  This is evident in the North Carolina supplies contract recently awarded to Office Depot.  There is plenty of information available on the web about this event.

This further eroding of the big box stores customer service capabilities is also evident in some recent tele-sales calls.  The prospects informed us that Office Depot and Staples were doing a lousy job of order fulfillment and delivery.  Orders were pulled wrong, drivers delivered the wrong orders, defective merchandise was never picked up or the customer service/order entry person had very limited product knowledge.  In one instance a Depot customer had complained that their product had been credited but the driver refused to take it back and the Depot representative told the customer to just “throw the products in the trash”!  Who do you think ultimately pays for this trashed product?

The independent dealer reigns supreme when it comes to customer service!  Let’s make an effort to give the customer or prospect an “experience” when they call.  It’s not just the service anymore but the experience the customer has when they talk to us.  Every day the power channel players put more ammunition in our belts.  Make that customer experience happen on every call.



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