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‘Purchasing online is almost a daily action’

The rate of attrition and change in people’s buying trends has accelerated in a way that most of us would not have imagined, says Steve Day, Sales Manager Middle East, Goveco, which reportedly has over 240,000 product lines, including AHUs and diffusers. Excerpts from the interview he gave to Surendar Balakrishnan of Climate Control Middle East…

| | Jun 17, 2021 | 3:54 pm
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Talk to us about the emerging trend of businesses moving to an online platform to sell their products?

As individuals, we have all become very aware of online purchasing. Following the pandemic, it is almost a daily action for most of us. Now that we have come to accept this natural shift, we are exploring business-to-business channels and finding that the more user-friendly the platform is, the better it is embraced.

Steve Day

How much inventory do you hold at any one point in time? Have you felt compelled to increase the inventory since making a foray into digital?

All our inventories are held in Europe, and we have access to over 240,000 product lines. With our manufacturing partners, we have committed manufacturing, and when we are engaged at the early stages of projects, all materials are made available to program. Needless to say, if they are not available, due to our commitments with the manufacturers, they will be a priority.

What is the range and depth of HVACR equipment you are offering to customers coming through your digital platform?

From air-handling units to diffusers, all our products listed on our website are now available through the webstore. We are adding daily as our portfolio increases due to innovation and an organic growth with our customers.

Would you say you are able to give a seamless digital experience that is convenient, mobile-friendly and, broadly speaking, is comparable to the reported service offered by e-commerce giants?

If anything, we would like to think we surpass the e-commerce giants, as we offer a personal service alongside our seamless bespoke system. As a customer, you will be introduced to the teams, and they will report each stage of the process to deliver customer satisfaction. For larger deliveries, we even offer live tracking that the customer has access to, so he knows where his order is, anywhere in the world.

What are the implications for contractors, consultants, clients and FM companies?

Is digital ensuring the same aftermarket services some of the top legacy distributors have been giving? These implications could be a deterrent or make the market nervous, as with retail sales you do not always get what you order. Goveco’s approach is unique in the fact that the online presence allows you to interact personally. If you are not sure about the technical performance of the product that you are looking to purchase, you can connect with an expert to provide you with the reassurance or impartial advice to ensure satisfaction. Our customers are our priority, not the sale, and to the clients you mentioned this is invaluable. It builds a level of integrity to deliver best practice, and clients trust in the brand.

How are you supporting digital customers during the design, construction, application and maintenance of their project?

All of the design detail and application detail are available online at all stages of enquiry, purchase and post-purchase. In most instances, there are installation guides and warranty statements with sufficient information for submissions, whilst clients and consultants can review themselves the specifications and compliance. As mentioned earlier, there is always a supporting team member at all the stages of the process with our customers, should they need more clarity.

Do buyers have access to multiple payment gateways?

Currently, we have a payment gateway that www.climatecontrolme.com 27 can facilitate the most common payment types. However, we are always investing in and reviewing our IT and e-commerce policies to stay ahead of the curve.

Are buyers able to request for drop shipment from manufacturers?

Yes, it is possible; however, as we offer a variety of products that combine as a solution, we generally consolidate those products to ship as a solution. Most customers see the value once they have explored this option and continue to add more and more products to their orders as we grow our relationships.

There is a trend blowing through the marketplace that given the current tight financial situation, many building owners are looking to retrofit existing equipment and that a greater number are looking to repair existing equipment, so that they can save on even expenses related to retrofitting. In view of this, are you offering components and spare parts through your digital platform for customers to carry out repairs to existing capital equipment?

Yes, in some cases we have spare parts listed, and we also have retrofit products already listed on our online store. Wherever the detail is not immediately available, our online chat allows us to assist our customers in finding the right solution.

A key concern among buyers is the genuineness of equipment, components and spare parts, given the fact that there are still some who manage to bring in and sell counterfeit equipment. How would you guarantee genuineness of your products? What checks and balances do you have in place?

Goveco is a brand of integrity; under no circumstances would we work with manufacturers that are not invested in our model. Most of the manufacturers we work with are stakeholders in Goveco or vice versa, and as such we ensure all certifications are in place and checked regularly. Audits are conducted on a regular basis, and updates on all standards are present on the website or upon request. Our sustainability record is recognized in Europe, again further supporting our demonstration of best practice within our DNA.

What cost advantage are you able to give to buyers when compared to your brick-and- mortar entity? Could you quantify that in percentage terms?

Assisting in designing, consolidating and delivering solutions and delivering ‘Just In Time’ with full tracking facilities gives buyers confidence that they are dealing with the right online store. A product delivery from Europe to the UAE would include an average of 12% value in freight, depending on its volume. If these products are purchased from various manufacturers, this value compounds, along with the possibility of delays, which as we all know, the Main Contractor penalties can make a difference of profit or loss on the package awarded.

How are you able to give the cost advantage? Is it owing to low overheads?

Our unit prices in some areas may not be the cheapest, especially against local manufacturing, but our model is built on a European Low Cost Country procurement program that is proven. Other manufacturers that we represent have fully robotized manufacturing and warehouse control, ensuring quality with product availability at a fraction of traditional manufacturing costs, whilst maintaining a very-low – almost zero – carbon footprint. Forgive me for suggesting that “old school” cherry picking procurement is not the best way to meet compliance and budget. If best practice is adopted in the earlier stages of a project, where clients’ wants are easier to meet due to the engagement of consultants, manufacturing partners and main contractors, the supply chain supports the clients’ vision and, ultimately, the budget. Some large main contractors have seen the value and have entered into framework agreements.

We live in an age where cyber-security is a massive concern? How are you ensuring that you are protected as a supplier and that so are your buyers?

Goveco invests substantially in its systems, and the use of the marketleading gateways gives our buyers confidence. As mentioned previously, our manufacturers are invested in the Goveco model, and that gets passed on to our customers – it is one of our USPs. Once customers understand the evolution of the supply chain and experience the Goveco Family, they feel confident to work with us more and more.

Do you believe that digital online stores are the future, or would brick-and-mortar stores still fulfil a specific, indispensable function? That is almost a debate. Who would have thought that online purchasing would be as big as it is today, 10 years ago?

The rate of attrition and change in people’s buying trends has accelerated in a way that most of us would not have imagined. There are still people who prefer to touch and feel what they buy. However, when confidence grows with reputable online stores the trends change. We hope to be at the forefront of consolidating air-handling and ventilation online procurement. This will happen as rapidly again in the next few years as people embrace the change.

Some say that digital is over-rated and that it cannot provide MEP consultants and MEP contractors the experience or tactile feel of a product in operation, as is possible in brick-and-mortar showrooms, where dedicated demo-rooms simulate real-time operation. How would you respond to this?

That mindset is always going to be around. There are gamechangers and traditionalists in all markets, not just the construction world. When prefabricated, fire-rated ducting was introduced to replace galvanized ducting, they said it would never work. The UAE is a visionary country and pioneers change, with other GCC region countries taking the opportunity to create their own visions. It creates opportunity for innovative thinkers supporting a robust supply chain.

Given the possible price advantage, would you be targeting the small contractors, who till now had found it difficult, if not impossible, to approach capital equipment of a certain calibre?

Every customer is important. Whilst we must maintain our existing customers in the way they have become accustomed we still treat all customers the same. To give a better idea on the spectrum, we have supplied a retail customer in a local community, requesting to replace the usually found AC controllers with two units from Sentera units, for whom we are globally exclusive, through to assisting a design-and-build, world-prestigious project. Engagement with a robust supply chain helps give security to the smaller contractors with lower overheads and, therefore, protects and nourishes those involved. That’s one of the reasons we signed with Besix globally.

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