It's coming up on midnight and I'm thinking lockers. This, folks, is how I know locker season has truly begun. Time to call the doc and up the meds. There are some interesting industry dynamics this year, a war to be specific. Read on for your entertainment and you'll know what's really going on in the locker industry that affect how much you'll be paying for lockers this year.

Please bear in mind that if were to be as specific as we'd really like to, we'd be getting those phone calls you'd rather not get. So here are the basics, for you, the locker seeking public.

The Locker War of 2010

There is a war going on in the locker industry. What were skirmishes in recent years has turned into an all-out battle. The gloves are off, and the locker landscape is getting downright nasty. One manufacturer is taking the soft economy as an opportunity to attempt to bury its competition by drastically lowering its margins as well as bidding direct on 10500-10 projects previously played by its dealers. The competition has been forced to follow suit out of sheer survival. It’s a war of attrition as manufacturers who are highly leveraged or lack adequate capitalization cannot withstand this game forever. Make no mistake—there will be casualties in this battle.

What follows is a synopsis of where the industry is for the two main types of customers we service: dealers/distributors and end users. When there’s an 800-pound gorilla in the room, it doesn’t make much sense to pretend it’s not there. And we acknowledge how difficult these times are for you, because we’ve been in your shoes for 39 years and understand not only what is going but why.

A Word to Dealers & Distributors

If you’re sick of being pushed down the ladder and want to sell lockers and make money, give us a call. We're not your average locker distributorship. We've been at this for nearly 40 years. We’ll work with you to provide every opportunity to keep and increase the market share you’ve worked so hard over the years to build up. With the recent shift to direct sales business models by some domestic manufacturers it’s become clear that the days of loyalty to dealers and distributors are effectively over. If you’re reading this and are a dealer or distributor you already feel the pinch as you’re finding yourself competing with the manufacturers you’ve supported throughout the years. And chances are you’re not too happy about.

So you look elsewhere to find a line you can represent that allows you to compete in a field you’re increasingly being locked out of. And if the domestic manufacturer you’re represented for years hears about it, you’ll likely be given a not-so-subtle choice of continuing to do business only with them or risk losing their line that you’ve built your locker business around.

As we call on dealers we’re hearing more and more cases of such manufacturer strong arm techniques. Dealers want to do business with us but fear losing their long-standing distributorships. Other have simple dropped out of the locker game because of this nonsense and subsequent shrinking margins. They’re telling us lockers are no longer worth it to them so they’re focusing on partitions, casters, conveyors and other storage and material handling products—anything but lockers.

When requesting special pricing consideration from manufacturers for 10500-10 jobs, many dealers are using fake project names in fear that the manufacturers will poach their leads and underbid them directly. That’s hardly a good business relationship when you’re forced to be surreptitious about the projects you’re pursuing.

We’re referring mainly to bidding 10500-10 bid projects, the lion’s share of the locker market. There will always be room to sell lockers online, just in smaller quantities. That is, of course, unless manufactures decide to set up companies to sell direct over the net. Indications are this is already happening.

Some private jobs still fly under the radar enough that you may luck out and not have a manufacturer find out about it and decide to go direct and underbid you. But the bigger jobs that you’ve needed to land four or five of a year to make payroll and (gasp) perhaps some profit? You’ll be lucky if you land a couple (or any) of them, given what’s going on.

Let’s be clear--the current discounts manufacturers are bidding direct with are not designed to increase their profits. They’re either designed to bury the competition who cannot financially sustain such a price war or are an effort to simply survive being put out of business. Even manufacturers who have traditionally protected their dealers and distributors are forced to do the unthinkable and bid direct, just to live another day.

Our extremely competitive dealer pricing will give you the chance to win projects that given the current landscape you might not even bother bidding, knowing that domestic manufacturers are going to bid direct anyway. We’ll give you pricing that’ll not only give you a chance to win projects, but make a fair markup as well. And we’ll assist you every step of the way with our superior product knowledge, sales support and post-sales service. We’ll even provide or line you up with quality installers in your area who will give you a fair shake and keep your customers satisfied.

A Word to End Users

This should be a good year for locker buyers looking for a bargain--unless steel goes up, which is quite possible. As these at-war manufacturers cut each others' throats and sometimes their own to move product in a brutal environment, all you have to do is beat the hell out of them a little bit and you'll get really, really good prices. But get them soon as steel is likely going to rise. The smart buyer can purchase lockers now and avoid higher costs in a month or two. One shelving manufacturer has already instituted a steel surcharge. Lockers won't be far behind, and once one leads the others will quickly follow. So shop and buy now, whether from us or someone else.

All locker firms want your business. But how do you choose? We know low price is king, nut understand that you'll have other criteria you're taking into consideration as well. Let us know what these concerns are so we can adequately quote your lockers (or shelving) with all your project needs in mind. And make sure you're comparing quotes apples-to-apples. Some firms add freight to the product cost. It's easier to hide a freight markup that way. We don't do that. Our quotes to you will have freight as a separate line item--and we don't mark up freight.

Shop, shop, shop. Learn the product before you buy. We'll be glad to teach you what you really need to know to make an educated decision.

A Word to Locker Manufacturers

We'd also like to be clear that we do not see you (the manufacturers) as "bad guys". You're trying to survive in a rough market with shrinking margins, increased competition and a growing number of quality imports. We just question some of your business methodology and corporate ethos.

You're fighting a war. Most of the big wigs in the industry have played musical chairs for decades, with everyone having worked with just about everybody at some point. Some of the feelings go deep and I think it's fair to say that some of you honestly hate each other. It's a shame, because we're all in the same market trying to accomplish the same goals. But each manufacturer has its own ethos as well. Sometimes it's best to just get out of the way and let you slug it out. If you're thinking to yourself "this page and its content isn't exactly how I'd plan to stay out of the way," we understand why. But this is important information for those who want to make educated decisions on the lockers and shelving they need so they can meet their budget, get the lockers when they need them so they can finish their project on time and have post-sale service--that kind of stuff.

A Late Night Conclusion

If any of this material was helpful to you, great. If on the other hand you think we must have a lot of nerve, try to remember that this stuff is true and you know it, and why would you want to conceal this from a market that's going to figure this out after the fact and end up not wanting to do business with you again? C'mon, let's let people know what they need to know. We'd want the same if we were in their shoes. It's good business.

And if any of this compels you to gives us a call, please do so. We can be reached at (888) 231-9790 Monday-Friday, 8:00-4:30 EST. Or email us. Thank you.

-- The Three Rivers Wholesale Team