Until
the late 1970’s in North America, there
was a distinction between importers, dealers,
and distributors. There were channels of distribution.
The number of stone dealers in the 1970’s
were small compared to today’s numbers.
THE
IMPORTER
Most
all importers in the marketplace knew each
other. The importers traveled the world in
search of stone that they felt would sell
in the market place. Perhaps the stone was
new like Violetta from Saudi Arabia or Taiwan
Green Marble. The importer would take the
risk and bring in some tiles and slabs and
try them out in the market in hopes they would
sell. The importer many times stocked the
material by the container/truck load and sold
through the local outlets in a specified territory
either through established distributors, dealers,
or contractors for specific jobs, by the pallet
or box or bundle.
The
importer would have to get this new material
out to the customers and in turn develop a
market need for this stone in the design/architectural
marketplace. If there was no demand for the
stone, then the distributor or dealer did
not want to handle the stone in most cases.
The importer took great risks and in most
cases stones they brought in for sale that
were new did not work out in the long run.
Probably 10 to 20 percent actually had selling
power.
The
importer would also finance everything from
the Letter of Credit to the supplier to selling
the buyer on open account and collecting the
money. An implied warranty was on the stone,
which gave the buyer a sense of safety and
security. If the stone was not what the buyer
thought it should be or there were some quality
problems, he sent it back or didn’t
pay the importer. The importer would work
out a credit for such problems and take care
of it.
This
all changed around 1980 when the demand for
stone rose. Distributors, contractors, and
even dealers or owners/architects started
to import directly. The importer then had
to change his strategy of buying and selling
stone. The risk of importing became a nightmare
to many in the market place. Even the producers
overseas found new headaches and problems
with the buyers who did not know what they
were buying or how to buy from overseas.
THE
DISTRIBUTOR
The
distributors' most important role was warehousing
stone, and secondly to have a showroom and
or sales representative go out and show and
sell stone to the dealers, fabricators, and
contractors. Before 1980 most distributors
were just this, warehouse sales companies.
After 1980 distributors became importers.
To
control stocks of tile, slab, and other stone
products became a real challenge. New computer
systems came about just to try and handle
this. Mixing and matching shipments of stone
became a challenge as well. Predicting and
having the right stock, color, size and quantity
a buyer might want is the challenge all distributors
face and will always face. Pricing this stock
for the marketplace became increasingly difficult.
Exchange rates were constantly changing in
the foreign market and the replacement costs
of inventory affected the sales. Competition
with new companies stocking was on the increase.
This also affected the price of stock. The
quality or selection of stone changed the
level of prices. Since many buyers did not
know various selections of a stone were available,
they too were not familiar with price differential.
When new stones of similar color entered the
market from Greece, Turkey and other countries
not well known in the market place before,
the pricing of stone again became difficult
and more competitive.
The
market opened up wide and started swallowing
all these new companies. The channels of distribution
from factory to importer, to distributor to
retailer/dealer all started to change. Importers
started distributing and retailing stone.
Retailers started to import. Factory agents
or representatives started selling commercial
jobs direct to the owners of buildings or
at least direct to the contractors. Prices
again were up in the air.
The
favorite comment by many distributors and
contractors in the 1980’s was "I did
not know that Nero Impala had three selections,
light-medium-dark." Or another comment was
"Did you know that Crema Marfil could be selected
by grades such as Extra, First Choice, First
Commercial, and Second Commercial?" Each selection
affected the price and most new buyers who
never traveled to the quarries and factories
or had long term experience with the stone
knew of these issues. Information on stone
was and is still limited in its availability.
Today more information is available then ever
before but still lacking in depth as far as
architects, designers, and serious stone people
are concerned.
THE
DEALER/RETAILER
Dealers
prior to 1980 were not available in large
numbers as they are today. Dealers would try
and support the importer or distributor by
showing their samples, and when a job came
available, they would buy from the company
whose samples they used. Most dealers were
in ceramic tile or stone fabricating yards.
The ceramic dealers would show small percentages
of stone in comparison to ceramic in vignettes,
which were not always of central focus in
the showroom. The knowledge that most dealers
had of stone was very limited, which caused
them to not promote and sell the stone well.
This lack of knowledge just promoted insecurity.
They were insecure on how to sell the variation
of natural stone, how to install it, and how
to maintain it. Even today, some of these
insecurities still appear, but are quickly
becoming addressed.
It
was expensive and time-consuming dealing with
the consumer on stone. Luckily most consumers
were not well educated about stone and did
not ask difficult questions or shop for the
stone as they do today. The fabricator would
try and show larger quantities of stone to
the buyers and work with them on a more educated
basis. The ceramic dealer would show a much
more limited sample range of the stone and
not know as much about the stone itself. Both
dealers were competing with each other. The
stone fabricators did not want the ceramic
dealer entering their domain. Only stone setters
should handle stone. During the 1980’s
it became evident that the ceramic dealers
handling stone were here to stay. Specifications
for the thin setting of stone by ceramic installers
became normal. It was also known that ceramic
installers could set stone tiles more cheaply.
This did not mean the quality of such installation
was better, only the price.
In
the 1980’s many of the dealers started
to sway from the supplier of the sample boards
and shop the price on each and every sell.
The architect/designer in many cases did not
give a lock specification for the supplier
and thus entered the term "and or equal".
This is still being defined today. The lack
of support for the supplier of the stone also
caused many suppliers to put fictitious names
on the stones to protect themselves and give
themselves and better chance of obtaining
the sale. Today the dealers have found that
stone is and can be a serious percentage of
their business and are devoting much more
prime space in their showrooms to display
stone. They are searching for stones that
fit their clients demands like buff colors,
rustic stones, patterns and designs, trim
pieces, etc. Dealers are educating their salespeople
about the do’s and don’ts of stone.
The consumers today are more educated then
ever about stone, and are asking more questions
and shopping the stone purchases.
SUMMARY
Many
changes have occurred in the last 25 years
in the stone business. Let us hope that in
the next 25 years we all expand our knowledge
and appreciation for the stone we sell, and
reduce the problems everyone has that are
a natural part of the stone industry.
Since
the main aspect of selling thin stone tiles
came about in the 1970’s new outlets
for selling of the stone have had to develop
like the ceramic tile dealers. New installation
also had to be established. Adhesive companies
started promoting new adhesives for thin setting
stone. Until 1970 the honed floor tile was
more normal then polished marble thin tiles.
Now came about the need for another new market,
maintenance companies. "How to maintain this
polished marble?" became the leading question
since 1980. The debate still continues.
The
dealers have expanded and now there are ceramic
dealers, carpet dealers, wood flooring dealers,
do-it-your self-dealers, and fireplace dealers,
just to name a few, are all selling or showing
stone. The fabricating dealer is today mostly
concerned with wavy type granites and kitchen
countertops. These dealers have had to put
in new machinery to handle this product and
produce the edge works and production levels
the market demands. With the introduction
of water jet cutting machines new designs
in stone are available thus expanding the
uses of stone and the types of dealers of
stone. With all this growth has come hundreds
or thousands of new stones and finishes from
over 34 countries. The types of stones being
sold has also increased to travertine, granite,
limestone, marble, gabbros, sandstones, slates,
onyx, quartzite’s, and many more increasing
the challenges of the importer, distributor,
dealer and maintenance company to handle the
various finishes and types of stones now on
the market place.
Today
it is even more difficult to differentiate
between the dealer, importer, and distributor.
The distributor was considered originally
as the wholesaler of stone. Many of these
wholesalers are selling direct to the dealers
and to the owners/architects. Most major distributors
are importing directly. It has become increasingly
easier for anyone to import, as it has been
for most producers overseas to sell directly
in the market place. With the advent of computers,
homepages and internet, more and more people
are learning about stone and able to communicate
directly with the factories then ever before
and do so inexpensively. Stone trade shows
have increased to the extent that one can
go to a stone show every month. They normally
are opened to the market place allowing anyone
to go and see stone.
The
stone business is well and alive. The residential
market is carrying most of the sales presently.
The importer, dealer, and distributor are
all waiting for a strong upturn of sales in
the commercial market. The transition that
the stone industry is in will continue for
many years. It is hard to foresee the future
and who will survive. Stone and ceramic tile
will increase in sales yearly benefiting dealers
the most. The natural growth will be for the
importer/distributor to become one and in
turn combine with the producers. Only time
will tell if this actually occurs.
