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CEO Blog
06/02/2014

Vendors instigate unnecessary price war

Just about every day now, we are working on "negotiations" regarding the turnover targets for the calendar year....

Just about every day now, we are working on "negotiations" regarding the turnover targets for the calendar year. These are always resolved by all the vendors only after one fifth of the year has already passed. The word "negotiation" is in quotation marks because in most cases, a stipulation exists, to which we then are allowed to say "yes" to. The popular excuse: "the stipulation comes from USA / Japan / from wherever" and "Management also gets its bonus only when a growth of XX is reached".

This is not a nice excuse, because the underlying translation is: "I did not have the guts to stand up to my supervisor, therefore I will just apply the pressure I am receiving onto the Supply Chain further and hope you shut up."

It is true that we achieved or surpassed our goals last year with all the major vendors, and that's a nice thing, because the result is that we get goal achievement bonuses. Since last year went very well, I have the impression that some vendors this year are simply "going bonkers". If a market leader is of the opinion that 14 % or even 20 % growth is needed to justify a bonus for the distributors, then something is wrong.

The market environment may be good for Jarltech, but one or the other distributor must definitely live with a loss in revenue. Thus, the under-performers should first get higher goals and finally work hard, instead of repeatedly punishing the over-performers for their good performance from the previous year.

If the bonuses (which are so important for the profits) depend on unrealistic growth, this will ultimately lead up to the fact that all distributors will retaliate with ridiculous prices. One of our vendors even acquired a new wholesaler, but nevertheless thinks that all others could grow by 10%.

My dear vendors - to whom this applies - think again: if a target is unrealistic, you will either not even try to achieve this goal, but instead focus on other products - and you lose sales. Or else, you are fighting with hook or by crook (which means price cuts), and therefore the profit margin collapses. Besides, once the prices are bled dry, then our Sales team will push the products of your competitors by next year, at the latest. A price war does not help any of us...

17/12/2013

Christmas Style

The least stylish things around Christmas time are e-mailings with "Season’s Greetings". Please: Do not do it. It is so OUT....

The least stylish things around Christmas time are e-mailings with "Season’s Greetings". Please: Do not do it. It is so OUT. Send a card, or a gift, but those e-mails are nothing but: spam. And embarrasing as well.

10/12/2013

This is what happens without distribution: customers get lost in the shuffle

When it comes to distribution a really poor sector for me is the business with high-quality furniture....

When it comes to distribution a really poor sector for me is the business with high-quality furniture. There are great furniture stores everywhere, but anything beyond Ikea or Segmüller only comes with endless delivery times. Why is this? Is it because the pieces on display only belong to the manufacturer anyway? The product portfolio is not very large, so a distributor in the back wings could handle it, right? It is just a matter of a drop shipment directly from the distributor to the end customer a few days later and everyone is happy.

Recently we had two chairs delivered at home - I almost refused the delivery because I completely forgot that we had ordered them a few months before. How is it that a move on short notice is possible, but your couch from Italy takes 16 weeks to arrive?

In my opinion there is a need for action here, because manufacturers lose business if they cannot deliver furniture. I have often purchased other items, simply because the product I wanted to have was not available. I have also ordered tailor-made furniture from China, because it was finished in ten days, then took only four weeks to be shipped; no furniture store in Frankfurt could match that. Our tables at home are all from one carpenter - not just because they should be different than the standard, but because we did not feel like going through furniture stores only to have to delay the changes to the living room by three months.

If any of you need an investment idea: this is a good place to start!

24/10/2013

Just ask Mr. Neumann!

One can often fend off a telemarketer with a friendly "thank you", since most callers are very nice people....

One can often fend off a telemarketer with a friendly "thank you", since most callers are very nice people. I do turn evil though if someone tries to get to me with lies like "I was in the army with Mr. Spranger." (where I had never been) or "at school" (where I rarely was) or something similar.

However, there are also companies where you never get off of the list. Every week someone calls, asking "Who is in charge of your ... ".

For cases like these, we now have Mr. Neumann! Because instead of simply hanging up and still repeatedly receiving the same calls, I prefer to answer: " ... For this only Mr. Neumann is responsible. However, since Mr. Neumann is deaf, unfortunately you can only really reach him by e-mail at dirk.neumann@jarltech.de. There is no other way."

Sometimes there are newsletters that you cannot easily unsubscribe to, because you have to show interest in a specific provider. But a quick note by email, asking to please address all future messages to Mr. Neumann is polite, and the problem is immediately solved.

And lo and behold ... it works. The number of calls is less, and I do not see whether or not Mr. Neumann receives e-mails, because I have chosen a 16-digit password for him, without looking at the keyboard.

We find it funny that now also mail for Mr. Neumann comes to our office. Catalogues, giveaways and even invitations. Even this mail is not annoying, because it can be put straight into the trash can. Since Mr. Neumann is now already included in a number of marketing lists, where you can obviously not make any mention of him being deaf, several companies still call here asking for him. For example, they want to try the latest investment tricks directly from London. Of course, each caller would say that he is naturally not making an "unsolicited" call, because he has been in a business relationship with Mr. Neumann for a long time.

This just came to mind: I kindly ask our marketing department to print business cards with Mr. Neumann's contact information, which I can then use at trade shows.

It's lunch time, so I will call Mr. Neumann into the conference room, so that at least I can eat meeting biscuits in peace and quiet. And if you want to write something from the soul, simply write to dirk.neumann@jarltech.de. He is a good listener and I promise you he will not annoy you!

11/10/2013

Promo mania as a last resort

In the last quarter, Jarltech has again met or exceeded all targets set by the vendors, and we are pleased to continue experiencing steady, double-digit growth.

...

In the last quarter, Jarltech has again met or exceeded all targets set by the vendors, and we are pleased to continue experiencing steady, double-digit growth.

What's funny is that some of our competitors who are losing revenue say over and over again during their analysis conferences: "Although we are losing revenue, we are gaining market share." Sorry, that is a bold-faced lie. But I do not have to buy your shares.

You can see where one or the other vendor on the market is losing points in the fact that some vendors again dig deep into the "promo" box in order to stimulate sales.

Leading the pack in this hustle and bustle is a large vendor of ours, who actually hurled eight "promos" with one stroke on 1 October. Plus, some of our employees are to be paid directly for the sales (which we cannot stand, because we want to decide for ourselves what products we promote). When a vendor employee wins a prize at our Networking Dinner there is immediate compliance-terror - but suddenly the companies can pay cash directly to our employees.

Or there are massive "retrospective rebates" on products which are still not selling better. Our dealers do not now go and buy 100 extra scanners if there is not a job order.

And if I lower a scanner price by 30%, then I have to massively sell more to reach a similar turnover. Of course, we distributors also preach that quarterly targets need to be reduced accordingly. Since all vendors should sell 30% more, it is quite logical that the price also is in the basement. It has taken just three days for the promos to be sent via data feed into all retail web shops - and thus the product is not interesting for a software house, since there is nothing more to earn.

Apparently, one or the other manager wants to reach for quarterly target by any means necessary - but maybe you should re-negotiate the goals realistically with your employer, rather than to give away a massive margin and to annoy the channel.

If one looks for the cause: every one of this vendor's employees which one talks to finds this promo mania completely useless and cumbersome, and nobody wants it to be "it" again. Maybe it was just a hacker from the competition, and it's all been just a stupid joke in the end.

02/10/2013

Jarltech Networking Dinner II/2013

What a party! Thank you to all of those who helped!
...

What a party! Thank you to all of those who helped!

Jarltech invites all EMEA employees to Frankfurt at least twice a year, as well as the employees of several vendors. Over the years we have perfected this event. Both bands only ran out of steam at 3am, and the last guests did not depart until 7am - in order to meet colleagues for breakfast. :) The largest Carrera race track in Europe attracted many "children at play".

The cost for such an event is naturally enormous, especially if you do not wish to offer a pathetic buffet, but rather, reward both your employees and partners. Here and there during events held by our vendors one could ask the question "What did I do wrong?" when you see the catering. Thankfully we gratefully receive amounts in the form of sponsorships from several vendors, although the bulk of the costs lies with us. Because of this, such an event is often controversially discussed. At the end the conclusion is always unanimously in favor of it.

We believe that a company which has 14 branches in Europe and the Middle East alone definitely needs a forum for exchanging ideas in a relaxed atmosphere. We also believe that it makes sense when an account manager of a Spanish scanner vendor has the opportunity to see our headquarters. It is also helpful for him (or her) to be able to exchange ideas with a Country Manager from the Netherlands. Plus our sales employees in Poland should know who it is packaging their orders or processing their expense reports.

After each Networking Dinner my iPhone is stuffed with new ideas from at least fifty short discussions. The most important thing to heed is my last note for the evening: do not schedule any appointments the next day!

P.S.: You will find photos and a short video of the event on www.facebook.com/jarltech

31/07/2013

Off for holidays?

From the banking sector I frequently hear that bank managers are not reachable during their holidays....

From the banking sector I frequently hear that bank managers are not reachable during their holidays. And that with force: some banks cut off the Blackberry feed, close all email addresses, plus all access to the bank system is inaccessible for the employees. Quite drastic actions for those who want to keep working. Or for those who are not bothered by an occasional email, and who hate cleaning up 100% before holidays begin in order to hand over work assignments.

In addition, employees must obligate themselves to take two weeks of holidays at once at least once per year, or else the company will assign them a block of time.

My suspicion that this is action on the grounds of employment protection to punish achievers for their intentions is completely wrong. No - it's management that enforces this rule with all their power. For those who play with banking and client funds on the securities markets could indeed cheat the bank, or at least try to cover up what's not going so well.

The calculation is that after at least two weeks of inactivity, or takeover by a foreign representative, 90% of all fraud and concealment attempts are busted. Well then - off to holidays. Not as a reward, but because your boss does not trust you and hereby can much more adeptly check what you are actually doing.

As a side effect roaming charges for 100,000 employees are also quickly gone. In case of an actual emergency, you can even leave the hotel address :)

P.S.: My spell check says it does not know the word "holidays". I just had to laugh at that. But it was a grammatical error. Maybe I'm slowly ready for holidays.

18/07/2013

The first half-year 2013

An increase of 46% over the previous year is simply a great result....

An increase of 46% over the previous year is simply a great result. Adjust this number to the new subsidiary "Jarltech China," and still a 35% increase in order intakes remains. The result is even sweeter when you read in the competitors' reports - sometimes now over several quarters - and see declines. Thus Jarltech grows disproportionately in market share.

We are especially proud that we have continued with double-digit growth in the home market Germany / Austria / Switzerland. This area accounts for 45% of our sales.

To continue to encourage growth, we are still looking for new employees in many countries, especially in sales. The training activity continues to progress; in June we celebrated the acquisition of six apprentices in Germany.

You can find pictures of Jarltech continuously at www.facebook.com/jarltech

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