Editor's note: This blog post was written by Fred Clements, executive director of the National Bicycle Dealers Association. Clements' previous blog posts can be read on bikedealerblog.wordpress.com.
In bicycle retail, professional mystery shoppers are sometimes used to evaluate a store. They visit in person to buy something. They phone and ask for help. They engage with the website. Then they rate the store's performance based on pre-established and detailed criteria. The completed scorecard can be a great tool for retailers who want a view of their business through fresh eyes, and with all key aspects of the business examined.
"When we deal in generalities, we shall never succeed. When we deal in specifics, we shall rarely have a failure. When performance is measured, performance improves. When performance is measured and reported, the rate of improvement accelerates." — Thomas S. Monson, with additional citations attributed to others.
For the supply side of our industry, this kind of feedback has not been as easy to come by. There are no mystery shoppers for cycling brands. Feedback from consumers is difficult to assess, and Internet chat is often troll-laden. Feedback from dealers has been mostly informal, general and sometimes emotional if there are issues. Is there a better way for brands to receive meaningful feedback?
There is now. The new NBDA Supplier Scorecard is now collecting detailed ratings on specialty brands from dealers nationwide. Dealers are asked to visit nbdasupplierscorecard.com, create a user I.D. and password, log in, and start scoring their suppliers with letter grades from A to F. When enough scores have been received, the results will be tabulated and made available to the industry in various levels of detail.
The plan is to build the Supplier Scorecard into an important resource to help dealers assess the brands they do business with, as well to encourage improvement in the performance of the brands themselves.
The scorecard criteria were created by a group of bicycle dealers working together. The scorecard incorporates the attributes that are important to them in working with the companies that supply them with products for resale. The categories are separated into five main categories.
- Profitability related to inventory management and turns. This includes product availability and whether shipping is on time. Order accuracy is assessed, as well as shipping quality (any damaged goods?). The return policy is evaluated, as well as pre- and back-order management.
- Profitability directly related to margin. The strength of brand programs is assessed, as well as shipping terms (free freight or reasonable minimums). Credit terms are scored, as well as whether published profit margins are considered to be sustainable from a dealer's perspective. A brand's IBD channel support is graded, including MAP (Minimum Advertised Price) and distribution policies. Warehouse flexibility is also analyzed, with an eye for policies that do not penalize a dealer for using an alternate warehouse if the first is out-of-stock.
- Brand performance in servicing the dealer. Friendliness and professionalism are graded, as well as the availability of education and information. Availability and responsiveness are rated as well, and a company's overall operating style (cooperation vs. coercion) is also assessed. Use of technology and warranty support are also scored.
- Customer value, or how dealers perceive the brand's value to the cycling public. This includes product quality, warranty, visual appeal, and how the brand stacks up compared to competitors. A brand is also scored based on its rate of change and cross-compatibility (products that work well with other manufacturers and don't unreasonably create new standards or proprietary designs that annoy dealers and customers.)
- Brand value. This assesses a brand's public reputation and public web site. Captive marketing is evaluated (marketing to cyclists) as well as mass marketing designed to drive a broader array of business to the dealer. Point-of-purchase displays are rated, as well as a brand's efforts to control distribution of its products and enforcement of distribution policies if they are in place.
All in all, there are 30 criteria per brand, and each is rated "A" to "F" by the participating dealer. Only the average grade for each will be released to the trade (individual answers will be kept confidential). Participants will be reviewed and qualified as legitimate bike dealers. It is expected that a dealer can rate a given brand in about three minutes, and there is a database of nearly 800 individual brands pre-loaded on the site that will make it easy for dealers to complete the scorecards.
As change continues to challenge the bicycle industry to adapt quickly and improve, the Supplier Scorecard can become an important tool for improving the industry's performance to serve the cycling public better. As of this writing, the NBDA already has received nearly 300 completed brand reports. Dealers: please participate today. Brand companies: stay tuned for developments.
