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D&M: Reseller Plan Protects Brand Equity

4/18/2011 12:01:00 AM Eastern
WEEHAWKEN, N.J. — D&M Holdings has launched a reseller authorization online portal which, among other things, will “protect brand equity,” according to Phil Cohn, senior VP of sales.

The plan, which was revealed last Monday, a day before the D&M press event, here, which unveiled Denon’s IN-Command AVR series and reviewed Boston Acoustics introductions from CES in January, in part, prohibits third-party sales and transhipping, as well as acknowledging a new unilateral advertised pricing policy for its brands.

D&M, which also markets the Marantz America brand, said the key to the plan is a reseller authorization online portal that provides all Denon, Marantz and Boston Acoustics resellers, as well as professional integrators, “with an opportunity to partner more closely with all three brands to help maintain sustainable profit margins and grow their businesses,” D&M said.

The portal is available for all dealers who purchase directly from the three brands, as well as those who purchase through third-party distributors and provides the companies with visibility to everyone representing their brands in the marketplace.

The new web portal requires all dealers and distributors of D&M products to register and agree to specific guidelines, including the prohibition on third-party sales and transhipping, as well as acknowledging a new unilateral advertised pricing policy for these brands.

In addition, it clearly outlines the prohibition of internet sales unless authorized to do so through a much more rigorous screening process, D&M said.

The web portal is the cornerstone of a multi-tiered strategy to effectively manage channel sales for all three brands, increase transparency, and partner more closely with all authorized resellers. As part of the ongoing effort to ensure that end users purchase only from authorized resellers capable of communicating the Denon, Marantz and Boston Acoustics technology, innovation, performance and brand benefit messages, all current resellers and all future prospects are required to visit the web portal and electronically sign revised reseller agreements, the company said.

D&M also reported that almost 99 percent of its resellers have signed their revised and fully confidential agreements via the online portal and acknowledged the new unilateral advertised pricing policy. Those who have not completed the process are unable to place orders or represent the brands until they do so and are approved, the company said.

D&M Holdings’ North American president Bob Weissburg said the authorization program “will allow us to be more strategic and focused in all channels, guard and protect our brand integrity, forge stronger relationships with our dealers, and also proactively monitor and take swift action to halt practices such as illegal transhipping and misuse of our intellectual property.”

He added, “We take our brand and market position very seriously, and this channel management initiative is an important step forward in helping us protect and reward our valued and indispensible authorized reseller network for all three D&M brands.”

Weissburg noted that unauthorized dealers and web retailers are “more aggressive” in the past year in selling products and that “One of the reasons why we are doing this is to dry up the source of transshipping and… aggressively close the back door.”

Cohn said, “We recognize that for our authorized resellers and integrators to invest in ‘telling our story’ they must be able to expect a certain level of profit from our brands. With this initiative, they will have yet another important tool to help grow their businesses.”

And he added that this effort, “Is not about restricting commerce… but about stopping transshipping, grey market products which hurt profitability.”

The program also enables D&M to “capture relevant information [about retailers and resellers] to increase collaboration with [them] and establish plans for healthy growth.”

When asked about the supply chain and inventories of the new Denon introductions, among other D&M introductions, Cohn said, “All of our new introductions are on schedule. There may be some problems with current models, but shipments of the new line[s] are on time. But most importantly all of our Japanese employees are okay.”
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