The role of the distributor in today’s amusement industry is continuing to evolve, Simon Liddle discovers.
THE art of being a good middle man – having the local knowledge to expand a brand’s presence within a marketplace while also providing support on the ground for operators.
Distributors play a key role in both emerging and established markets, becoming essential cogs in the amusement machine. Yet, there is a misunderstanding among some people as to the place of a distributor within the scheme of things. Some argue that they simply add an additional layer of cost for the buyer and squeeze the margins for manufacturers. Is this fair?
Not so, says Matt Bland of UDC, a UK-based company that is this year celebrating its 30th anniversary. There is a fundamental difference between consumer products and commercial products when it comes to channels of distribution, he explained. Big consumer electrical companies have the size and scope to have offices and sales outlets in each and every market because the number of units they sell warrants this. Smaller, niche product manufacturers – and here we can place amusement equipment manufacturers – that sell a fraction of those quantities, are not in a position to support such an infrastructure. They therefore seek to work with partners on the ground.
“All big amusement companies work with local partners,” Bland said, explaining that UDC represents, among others, Benchmark products, providing spare parts and technical support. “Few manufacturers can afford the necessary infrastructure in all these countries. We are able to operate from a much better position because we have technicians in-house, for example. We spend money on stocking parts and other consumables and have a department to service all the manufacturers we represent. We back up all the machines that we sell.”
There are distinct advantages to working with a distributor for amusement manufacturers, rather than supplying directly. Local distributors – at least the right ones - know their markets better than anyone else. They are immersed in it in a way that would take years and much investment for an outside manufacturer to replicate. There are regulations to adhere to, often detailed and idiosyncratic, meaning a machine that is approved for sale and installation in one territory may fall foul of legislation elsewhere. Distributors make it their business to know what the requirements are because their customers place a lot of trust in them.
Read the full article in the May issue of InterGame
