Monday, January 1, 2001
Posted by RV Doctor
By Gary Bunzer
Okay, you’re sitting in your recreation vehicle. As you look around, you see many items in, on and affixed to your RV. You probably have four propane appliances; a refrigerator, cooktop, furnace and water heater. You know there’s a propane container of some type fueling each of those appliances. There’s a fresh water demand pump somewhere, sucking water out of a plastic storage container and forcing it through the water distribution system, through the faucets, into the toilet and shower and ultimately down to the waste holding tanks. You probably have an air conditioner or two (or more), a generator, a converter, perhaps an inverter located somewhere on board. Of course you have windows and doors, television antenna and roof vents and lamps and many other large pieces and parts everywhere. Okay Doc, we get the idea! What’s your point?
Well, the point I’m trying to make is that, even though we call them RV “manufacturers,” rarely does the factory actually manufacture or produce everything in, on and affixed to the RV. Perhaps more appropriately, they should be called RV “assemblers.” Obviously the original equipment manufacturer (OEM), the maker of your RV, purchases items from supplier manufacturers and installs them into and onto their brand of recreation vehicle. They buy the refrigerator from Dometic or Norcold, the water heater from Suburban or Atwood, etc. They build the coach, run the wires, the plumbing, etc., and assemble it all into what we ultimately find on the dealer’s lot. So suppliers create most of the widgets that the OEM installs into the RV.
There’s another segment of the RV supplier industry you may have heard me mention a time or two, especially if you’ve ever attended one of my seminars at an RV event. I’ll often state, “Thank goodness for the aftermarket!” The supplier aftermarket is that segment where supplier manufacturers, inventors and other creative types offer products, parts and pieces to anyone and everyone. In some cases, the RVer may have to order that widget from a dealer on your behalf, but it’s still available nonetheless.
The aftermarket is also where you’ll often find the “better mousetrap.” Not literally a mousetrap, but a better overall product that is oftentimes far superior to the same product that found its way onto your RV at the OEM level. You see, buying decisions at coach builders (the OEM), are often based (unfortunately) on economics or availability, as opposed to quality and build value. It is also the reason why there are varying price points at the retail level for similar products. The “better” the product, the higher the price. It’s likely the better products will be found in the more expensive RVs. This isn’t always true across the board, but it follows the methodology typically used since the modern era of RVing came about.
So how did your RV manufacturer choose which products went into your RV? Probably by a bunch of different ways; bids may go out from the coach manufacturer to the product manufacturers to compete for a pricing structure based on how many widgets they may need at that given time. Also, product manufacturers may pitch their products directly to the OEMs, seeking favor by offering deeply discounted prices, customer support, training, and other perks, etc. Sales reps and distributor reps also seek an audience with factory buyers to showcase the product lines they’ve taken on.
The RV Industry Association hosts the annual National Trade Show in Louisville, KY each fall where suppliers and manufacturers show off their wares, not only to each other, but also to dealers, distributors, service shops, accessory stores and others within the industry. Coach makers also get a chance to see new products and the negotiating begins. The National Trade Show is not open to the public, so all the deals made in Louisville are on the wholesale side; among suppliers, distributors, coach manufacturers, service facilities, accessory stores and RV dealers.
In the RV aftermarket, the Industry has used a traditional, two-step method of getting products from the originator to the buying public. The supplier manufacturer typically sells to a distributor, the distributor sells to a retailer (dealer or accessory store), and finally, you get to hand over your money to obtain that product. Hmmm, maybe that’s three steps! At each step, commerce takes place and each segment realizes a profit in the process. Obviously, the supplier manufacturer needs to make money in order to maintain production and to keep inventing (or purchasing) new products. And the distributor needs to make a profit, so he marks the product up a bit to sell to the retailer. The retailer also needs to make a profit, so he marks the product up further and sells it to you.
This isn’t really such a bad deal. For one thing, the buying public is used to this process. And each segment does perform certain functions at each level to make the product more saleable; most do earn their keep. Here’s one flaw I’ve realized in this retail model; some of the best products never get in front of the RVing public. Why? Let’s follow this scenario…
Someone comes up with a better mousetrap. (By the way, our industry is filled with brilliant inventors, tinkerers and design engineers, many of who are active RVers and have found a better way to, well, enjoy the RVing lifestyle). So this new widget is created, designed, vetted and proven to enhance the RVing lifestyle. So far, so good. After obtaining all the legal protection and business acumen, he approaches as many people and companies as is possible in hopes of getting his new widget to market since he thinks he can actually make some money from his invention. Additionally, he might rent a booth at an RV show or take out a display ad in an RV magazine, anything to get attention and create initial traction into the marketplace.
The distributor, however, may take a look and decide he’d have a difficult time trying to sell that new widget to his retail clients so he might pass on it. Perhaps the cost is too high; maybe the widget is just too radical or different. So the cool new widget dies on the vine. There are dozens and dozens of great products created by some incredibly bright minds that never see the light of day. Or if they do, it’s a dim light at best.
Even if a distributor decides to carry that new widget and pitch it to his retail clients, there’s no guarantee the retailer will opt to stock his shelves high with it. And the cool new widget gets another chance to die a slow death.
At the same time, some creative suppliers will try to pitch the new widget directly to the OEM, the coachbuilder, in hopes of convincing them to buy it directly and install it on every coach on the assembly line. This tact is usually far from lucrative as well. (You should see all the hoops that need to be jumped through just to get an initial appointment sometimes).
The end result is that, quite often, some amazing new products never get a chance to be seen by those most in need of it. That’s one reason why I often seek out such products and introduce them to readers of the RV Doctor Newsletter or the RV Doctor Website. It’s a shame that many good products languish in anonymity or rarely exist beyond the cursory glance of buyers at distributors and OEMs, or meek exposure at a few local RV shows.
But with the Internet and the explosion of digital media, today many supplier manufacturers are foregoing the traditional route and opting instead to create informative websites and sell directly to the RVing consumer. The good news is that today, there is no reason to have a great product fade into obscurity due to the lack of large capital backing; or because of a shortsighted distributor. Or dismissed because of a penny-pinching buyer at a coach manufacturing plant. Quality products, and I stress the importance of the word “quality,” now have a better chance of being brought to market, directly to the RVer at a lesser price to the end user. And at a larger profit margin (in some cases) for the supplier. Remember, there’s no distributor or retailer snatching their piece of the pie in this, business-to-consumer, sales model.
That’s not to say there’s no downside to this model, however. It takes just as much effort (probably more so) to go the direct route. A dedicated staff, refined production skills, creative marketing ideas, Internet and social media expertise, massive amounts of networking, media exposure, all must be mastered before success becomes apparent. Additionally, outside supporters such as recognized endorsers, authors and educators are also needed. The ramp up to market may actually take longer. But credit those who have eschewed the old methodology and embraced the new, because thanks to them, all RVers, at least, will have an opportunity to experience that shiny new widget after all.
Additionally, many of those suppliers adopting this business-to-consumer strategy offer exemplary customer support after the sale; something that is traditionally missing through the older method of marketing. This enables the supplier to create, nurture and expand a personal relationship with their ultimate customer, without the interference of the middle guys. This is crucial for small businesses especially. It allows them to have a hand at their own destiny. And I suggest this is also important to the buying public. They can have a direct ear to the actual supplier of that widget, thereby creating a longer, personal relationship with the supplier. Plus they usually get to speak with a live human being rather than be forced through a maze of phone messages with little hope of reconciling whatever issue they might have.
Of course, using this model, the supplier manufacturer has no excuse for poor performance of the widget or a blatant lack of concern since RVers too, are becoming adept at using digital social media. They will broadcast their dissatisfaction quickly and overtly. This can be the death knell for those suppliers not ready for this type of sales model. But for many, it can be very successful. When designed and implemented correctly, a realistic win/win for everyone!
You, the RVer, also contribute to the success of these entrepreneurial supplier manufacturers. As mentioned, you read blogs and forums. You talk about products, new and old, good and not so good, daily. And many of you are indeed interested in seeing what new widget comes next down the pike. This aspect of living the RVing lifestyle mandates an attitude of awareness that I often site when I refer to those “serious RVers, (and you know who you are!)” in my seminars and videos. It’s the proactive RVer, performing due diligence and research, who often finds new and exciting aftermarket products. Don’t overlook the importance of your participation exposing new and credible RVing products to the masses!
I receive a bunch of emails annually alerting me to new widgets. So I appreciate your dedication in this arena. I research many new products every year and even install, test and evaluate many I think may warrant an RV Doctor mention in an article, on the Website or in the Newsletter. So keep your eyes peeled for that bright, shiny new mousetrap and be sure to let me know what you think about it! And remember, RVing is more than a hobby, it’s a lifestyle!