As The Cube Melts

The Automatic Ice Newsletter

A MESSAGE FROM THE PRESIDENT

THE INDUSTRY IS CHANGING

THIS IS THE SECTION OF THE NEWSLETTER WHERE I TALK ABOUT REAL ISSUES AND SERIOUS SUBJECTS THAT AFFECT OUR RESPECTIVE BUSINESSES AND INDUSTRY. USUALLY, I TRY TO BE UPBEAT, EVEN WHEN DISCUSSING SERIOUS PROBLEMS. BUT THIS MONTH, I’M HAVING A LITTLE TROUBLE BEING JOVIAL WHILE FEELING THE WAY I DO. LET’S BE REAL HONEST - THE REFRIGERATION/ FOODSERVICE INDUSTRY HAS NEVER BEEN THE EASIEST WAY TO MAKE A LIVING. ANY “VETERAN” OF THIS INDUSTRY WILL TELL YOU THAT.

WHAT I’M HAVING TROUBLE ADJUSTING TO LATELY THOUGH, IS THE NEW LEVEL OF COMPETITION, MANUFACTURING APATHY, BROKEN PROMISES, UNSCRUPULOUS BUSINESS DEALINGS, AND IN GENERAL, A TOTAL DEVIATION FROM DOING BUSINESS THEY WAY I WAS TAUGHT TO DO BUSINESS.

REMEMBER THE OLD MOVIE “NETWORK” ? THE ONE WHERE THE GUY KEEPS STICKING HIS HEAD OUT THE WINDOW AND SAYS “I’M MAD AS HELL AND I’M NOT GOING TO TAKE IT ANYMORE” ! IT’S KIND OF HOW I FEEL AT AUTOMATIC ICE LATELY.

EVERYDAY I HEAR IT ON THE PHONES, OR, LISTENING TO THE REPORTS FROM MY BROTHER ON THE ROAD SEEING CUSTOMERS, THE TRIALS AND TRIBULATIONS OF JUST HOW HARD IT IS TO CONDUCT BUSINESS IN THIS INDUSTRY THESE DAYS. I’M NOT TRYING TO BE A CRYBABY. AFTER 26 YEARS, I AM WELL VERSED IN THE FACT THAT THIS INDUSTRY HAS IT’S SHARE OF STRESS AND AGGRAVATION.

BUT LATELY, IT ALL JUST SEEMS TO BE MAGNIFYING. FOR EXAMPLE, I FIND MYSELF HAVING TO BEG MANUFACTURERS REPEATEDLY JUST TO SEND LITERATURE. IT HAS BECOME A RECURRING BATTLE WITH MOST OF THE FACTORIES TO ISSUE CREDITS FOR RETURNED WARRANTY PARTS OR PAY SERVICE INVOICES. NOBODY SEEMS TO REMEMBER WHAT A PROMISE IS, AND, LOYALTY AND INTEGRITY SEEM TO BE AS OUTDATED AS NEHRU JACKETS AND POLYESTER LEISURE SUITS.

ALL THAT ASIDE, WHAT TROUBLES ME THE MOST, AND THE POINT OF THIS RAMBLING RANT – LOW PRICING HAS ALMOST OBLITERATED THE PHILOSOPHY OF SELLING A QUALITY PRODUCT.

NOBODY SEEMS TO CARE ABOUT WHAT A PRODUCT IS MADE OF ANYMORE, HOW LONG IT WILL LAST, OR, HOW EXPENSIVE IT IS TO MAINTAIN. EVERYONE IS JUST LOOKING AT THE INITIAL PRICE OF A PRODUCT AND END ALL OTHER CONVERSATION.

I’M SORRY. I’M NOT USED TO THIS. I WAS BROUGHT UP IN THIS INDUSTRY FROM A TIME WHEN HOW A PRODUCT PERFORMED, IT’S LONGEVITY, AND IT’S SERVICEABILITY MEANT SOMETHING. TO BE BLUNT (AGAIN), NOBODY SEEMS TO GIVE DAMN. IT’S ALL PRICE, PRICE, PRICE.

SOME MIGHT SAY TO ME, “GET WITH THE TIMES”. I WILL ADMIT, I DO HAVE MANY OLD-FASHIONED IDEAS AND VALUES WHEN IT COMES TO THE BUSINESS. I ASK YOU, ARE THE CONCEPTS OF SELLING ONLY QUALITY PRODUCTS, MAINTAINING HIGH CUSTOMER SERVICE LEVELS, AND STANDING BEHIND WHAT YOU SELL OUTDATED PHILOSOPHIES ?

I TRULY UNDERSTAND THAT OWNING A SUCCESFULL BUSINESS MEANS THAT YOU, AS WELL AS THE BUSINESS ITSELF, MUST CONSTANTLY CHANGE AND ADAPT TO WHAT IS GOING ON IN THE BUSINESS WORLD.

BUT DOES THIS MEAN THAT MY ORGANIZATION, BECAUSE OF DAILY INCREASING COMPETITION, THE INTERNET AND CATALOGUE COMPANIES, AND THE DELUGE OF CHEAPER FOREIGN MANUFACTURED EQUIPMENT, SHOULD THROW AWAY EVERY CONCEPT WE HAVE EVER FOLLOWED ABOUT SELLING ONLY QUALITY EQUIPMENT AWAY ?

IN THIS NEWSLETTER I HAVE MADE THE ANNOUNCEMENT THAT WE ARE ADDING A LOW COST LINE OF REFRIGERATION PRODUCTS TO SELL. “CARDS ON THE TABLE” – THIS WAS NOT A DECISION THAT I MADE “VOLUNTARILY”. IT REALLY WAS A DECISION THAT WAS MADE FOR US. WHEN WE SEE AND HEAR OF OUR ESTABLISHED REPEAT DEALERS BUYING FROM OUR COMPETITION BECAUSE OF PRICE, AND ONLY PRICE, THEN THERE’S REALLY NO DECISION TO BE MADE AT ALL. EITHER WE GET A PRODUCT TO DISTRIBUTE THAT CAN COMPETE, OR, WE GET OUT OF THE REFRIGERATOR BUSINESS.

ALTHOUGH I AM HAPPY TO HAVE COLDTECH TO DISTRIBUTE AS THEY ARE NICE PEOPLE, SEEM VERY RESPONSIVE, AND THE PRODUCT IS DECENT, I REALLY DIDN’T WANT TO INVEST MORE MONEY IN OUR INVENTORY ESSENTIALLY JUST REPLICATING PRODUCTS THAT WE ALREADY HAVE HERE, JUST TO OFFER A CHEAPER ALTERNATIVE.

MY INTENT IS NOT TO SOUND LIKE THE VOICE OF GLOOM AND DOOM AS FAR AS OUR INDUSTRY IS CONCERNED. ALTHOUGH MANY TIMES

CHALLENGING, THE BUSINESS OF FOODSERVICE/ REFRIGERATION DOES AFFORD US THE OPPORTUNITY TO MAKE A DECENT LIVING. BUT WHAT DOES UPSET ME IS THE THOUGHT THAT OUR INDUSTRY MIGHT INDEED BE A SMALL MICROCOSM FOR WHAT IS HAPPENING ALL OVER IN THIS GREAT COUNTRY - ONCE PROUD MANUFACTURING AND SALES ORGANIZATIONS FOUNDERING BECAUSE THEIR ORGANIZATIONS CAN NOT MANUFACTURE AND BRING TO MARKET A PRODUCT AS CHEAPLY MANUFACTURED, AND AS COMPETITIVELY PRICED AS THEIR FOREIGN COMPETITORS.THE AMERICAN MANUFACTURER’S COST OF LABOR, EMPLOYEE BENEFITS, AND RAW MATIERIALS GIVES THEM AN UNFAIR DIS-ADVANTAGE IN THIS “WHO CAN SELL IT THE CHEAPERST” SCENARIO. JUST LOOK AT THE AMERICAN AUTOMOTIVE MANUFACTURING COMPANIES LIKE FORD, IF YOU DON’T BELIEVE ME.

HALF OF YOU MIGHT CRITICIZE MY DECISION TO DISTRIBUTE A CHEAPER LINE OF REFRIGERATION PRODUCTS. THE OTHER HALF OF YOU MIGHT APPLAUD IT. WHATEVER SIDE OF THE COIN YOU FALL UNDER I WILL SAY THIS:

IT IS REALLY VERY SIMPLE – IF MY ORGANIZATION IS GOING TO STAY IN THE REFRIGERATOR BUSINESS, THEN WE MUST HAVE A LINE THAT ALLOWS US TO PLAY THE “WHO CAN SELL IT CHEAPER” GAME.

I DON’T LIKE IT, I DON’T AGREE WITH IT AS I ANNOUNCE WHAT WERE DOING, BUT, IF WE’RE GOING TO “PLAY THE GAME”, THEN I HAVE TO HAVE THE UNIFORM.

WITH THE EXCEPTION BEING HOSHIZAKI ICE EQUIPMENT, I MISS SELLING EQUIPMENT BASED ON IT’S FEATURES, BENEFITS, QUALITY, AND LONGEVITY. I DON’T WANT TO BECOME THE “FIVE AND DIME” OF THE REFRIGERATION INDUSTRY.

YET, I AND MY SMALL COMPANY ALONE CAN NOT FIGHT WHAT NOT ONLY SEEMS TO BE OUR INDUSTRY TREND, BUT THE TREND OF THE COUNTRY IN GENERAL.

ONE OF MY FAVORITE BUSINESS QUOTES OF ALL TIME WAS FROM LEE IOCOCCA, THEN CHAIRMAN OF CHRYSLER – “IN BUSINESS, YOU HAVE TO LEAD, FOLLOW, OR GET OUT OF THE WAY”.
SAD AS IT IS TO SAY, I CHOOSE TO FOLLOW RIGHT NOW.