Cooperatives are becoming more popular with distributors. Magazine EHZ met up with André Flottmann to discuss it in depth
“Only a power cut will stop us now”
EHZ: Adverts from PC Spezialist are becoming bigger and yet cheaper. The company is now in 30 cities in Germany. How was this progress possible.
Flottmann: The basic idea of PC Spezialist is not new, the bringing together of dealers to help make your own brand stronger. It has been often tried in other branches but it has always failed. PC Spezialist can now show what stengths this concept has.
EHZ: What services do you offer the partners?
Flottmann: We offer centralized distribution and processing, centralised purchasing to ensure cheaper prices, adverts, brochures, corporate design, market analysis. The partners receive a range of services that would be impossible for a smaller company on their own.
EHZ: What is your secret then?
Flottmann: To get this kind of success you need 2 things. Firstly, trust in the direction of the company and the fact that all involved work to their maximum capacity. Its very important that everbody is pulling in the right direction.
EHZ: How are your competitors reacting, is there jealousy and people trying to copy your style?
Flottmann: I respect our competitiors. Its important to remember the principles of PC Spezialist. The dealers need to concentrate on their own output. I would be happy to accomodate others in the module. PC Spezialist promotes a good working atmosphere where nobody dominates and works towards the joint goal of becoming number 1 in Germany.
EHZ: Isn´t that going a bit far?
Flottmann: There are already 34 branches in Germany. A year ago when the concept was born there was lots of talk of over optimism on out part and we were not taken very seriously. Since then people now laugh when we say we want to be Germanys largest, but thats life.
EHZ: Back to the competitors…
Flottmann: There are always going to be competitors, but you they have to remember two things, honesty and trust. Companies in this field that rely on outside financing need to remeber that if they want to catch up they will need further bank loans and eventually the banks are going to lose their patience in lending.
EHZ: What do your retailers have to do?
Flottmann: The PC Spezialist partners don´t have to have too many worries, others that concentrate on themselves neither. If you cant keep up, either in PC Spezialist or outside then your business will fail.
EHZ: What tips could you give the retailers?
Flottmann: That questions sounds like a consultation! Firstly, if you see a possible opening in your area, then set all your resources on capturing and that target (group) Secondly, make sure you join a cooperative that makes you as competitive as possible in the shortest period of time available. We have initiated the “PC Spezialist-Lean Partner” programme which allows possible partners to get to know the system in a quick and easy way.
EHZ: What happens to those who don´t want to join in?
Flottmann: Most large businesses today are part of some franchised based module. There is often a financial push in the form of sponsored produce or advertising. That leads to a forced franchising with a centralized dealer. I think the dealer with a good market position are clever enough to read the contracts though.
EHZ: Isn´t that a bit pessimistic?
Flottmann: I can only repeat what I have already said. I think that dealers nowadays should concentrate on restrukturing their companies, especially those that currently face rising purchase prices and sinking profit margins. My advice would be to join a collective similar to the system that is offered by PC Spezialist.
EHZ: How would you recommend choosing a cooperative
Flottmann: Their services should not be expensive! Our Lean Partner system offers all kind of bonuses at competitive rates. Apart from our cooperative, only 2 others come to mind, at least ones that operate on a serious basis. Many large business try and use a franchise module to be the base for the further future financing especially when it comes to personel decisions. That is why there is a conflict of interests many times.
EHZ: How can retailers contact you?
Flottmann: Our address is always in the numerous advertisements that we have posted in magazines such as Chip, PC Professional and of course EHZ. We currently have around 10-15 applicants coming to us on a daily basis and regardless of this virtual flood we still have our eyes open for the future.
Many applicants often faze themselves out due to a lack of capital on their part or even a lack of management power. Another deciding factor is that we want applicants who share our values.
Potential newcomers should give us a brief run down about their company and let us know which areas they are particularly interested in.
EHZ: Thank you Mr Flottmann for your time.