TOTAL LACK OF RESPECT

Honda take the impersonal stance in sacking dealers
TOTAL LACK OF RESPECT

CHRIS BIDDLE, Service Dealer founder, writes . . .

I well recall Honda’s entry into the UK lawnmower market at the IOG show of 1978 at Motspur Park. With a range of just three mowers, it had all the hallmarks of a testerone-fuelled launch more reminiscent of the Motor Show (as then). Led by sales manager Eric Sully resplendent in cream suit, accompanied by a bevy of promotional girls, the event certainly caught the eye of a rather conservative trade, even if it didn’t exactly immediately flood the order book.

Honda soon realised they had to appoint someone who knew the mower business. They turned to Mike Barnfield, a no-nonsense, straight-talking salesman who had spent the previous years with Webb Mowers, who was appointed to head up the Honda power equipment division in 1980.

Although employed by one of the world's largest automotive corporations, Mike was always acutely aware of the role that independent sales and service dealers must play in Honda’s future fortunes.

He embraced the phrase ‘glocalisation’ that Honda liked to use instead of ‘globalisation’.

In an interview with me for Service Dealer in June 1990, he talked passionately about the dealer/supplier relationship - the key cornerstones of which, he said, should be openness, transparency, clarity and respect.

Mike built up the Honda Power Equipment UK dealer network steadily during the 1980s, and it was a surprise when, without fuss, it was announced that he was to leave Honda in 1993. Little was heard of him after his departure, probably due to legal obligations, and it was sad to hear of his death in 2009 at the age of 72.


Impersonal


All of which is in stark contrast to the actions of Honda 2020 last week, when the company announced that they were sacking 50 of their UK dealer network, taking the number down to 150 from 200 in a single move. Advising the impacted dealers, they took the impersonal and easy option of sending them a letter giving the statutory 90 days notice - a number of which did not arrive before some dealers read about their decision in last week's Service Dealer Weekly Update.

There had been no consultation, no explanation, no advance discussions. One dealer who been with Honda for over 30 years, selling thousands of their machines and having had no issues or meaningful problems over all those years told me, “The letter came as a bolt from the blue. When I tried to reach all my key contacts at Honda UK, they all went to ground. Given the amount of business I had done with them I would have at least liked the opportunity of some dialogue, even if it was a ‘fait-accompli’. Instead there was a complete wall of silence.”

That is shameful treatment of mostly long-term business partners. This complete lack of respect and openness does not reflect well on Honda - after all courtesy costs nothing.

Which is a pity because there has been so much to admire about Honda over the years. They brought dynamism to the mower business on the back of their much higher profile other divisions. They provided a level of logistics in the supply of machines and parts out of the reach of mere mower suppliers. State of the art training facilities were outstanding and of course the mower business was able to ‘piggy-back’ off creative and effective brand advertising campaigns.

And of course its powerful USP was that machine and engine came from the same source, something that Yamaha later tried to emulate but failed rather spectacularly. 

The rationale provided by Honda is that the slimmed down dealer network will sell more machines and service and thus improve and protect their profitability.

Does anybody buy that?

There has long been a saying that ‘dealers sell what they want to sell’. Most of the ‘sackees’ will switch their customers to other brands. Over the years dealers have had to adapt to the shifting sands of franchise churn, either by choice or because of events outside their control.

I’ve learned over the years that the real reasons behind a parting of the ways between suppliers and dealers are rarely made public. Indeed, we may not know if there is a bigger picture behind this decision by Honda to slash a huge chunk of their dealer network.

Dealers accept that they are often at the mercy of remote decision makers. But that does not negate civility or respect. And rather poignantly, the dealer with 30 years association with Honda told me, “I will have a full-line up of mowers to offer my customers next season – but deep down I still love my Hondas!”

That level of brand loyalty from a dealer would rightly be regarded by any manufacturer as a thumping endorsement of its distribution policy, something to be nurtured and built upon.

But not Honda it would appear.

Comments (1)

  • David Croucher

    David Croucher

    19 October 2020 at 17:44 |
    Having been previously employed by Honda (UK) for nearly 20 years I find this news somewhat sad but not surprising.
    During my Ten years as an Area Sales Manager in their Power Equipment division and Nine plus years in the Dealer Development department as their Franchise Manager, I played a key role in managing Honda’s UK L&G dealer network.
    Of course, every business needs to review their strategy, make decisions and change. However, I think most would agree there is an honourable way of implementing those changes and demonstrating a level of respect in doing so.
    I guess the remaining dealers will be pleased to continue with Honda, but I question their thoughts about how the termination process has been delivered and whether or not they think they may find themselves in the same boat sometime in the future.
    Despite having many fond memories during my employment, it is news like this that allows me to have no regrets in leaving when I did.
    I wish those effected, the very best of luck for the future.

    reply

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