Economies of scale, one-stop shopping, broader, quicker distribution, comprehensive customer service-these are all benefits which "consolidating" companies hope to provide retail customers. But what does size really offer to the store planner? Are these "size XL" companies able to better serve customers than their smaller counterparts? What should a retailer consider when contemplating small, regular, or extra large fixture vendors?

In her Publisher's Note of the June 2000 issue of Display & Design Ideas, Karen Schaffner reviewed conflicting opinions regarding fixture manufacturing mergers and acquisitions of the past few years. "Some believe the consolidation is a negative�and dread the loss of personal contact with the owner of the company. Others fear that big business will stifle creativity. On the other side of the argument are those who believe the larger companies offer more stability, along with a greater range of resources," wrote Schaffner.

Make Mine Super Size, Please

According to Dr. Arthur H. Bobis, vice president of corporate sales & marketing for RHC/Spacemaster Corp., strategic acquisitions have allowed his company to supply the more complete needs of each of his customers. "We are able to develop teams under the direction of a single individual," he says, "The team represents our company's comprehensive products and services to our customers."

IDX Executive Vice President of Sales & Marketing, Bob Heditsian, states that his company feels the benefits of consolidation are its broader capabilities. "We provide access to all of the different mediums, so clearly if customers want to do one-stop shopping, we've got the ability to do that under the umbrella of IDX. It provides us the ability to manufacture in various parts of the country for a project that is national in scope, which helps the customer reduce freight costs." According to Heditsian, the size and scale of IDX better positions it to handle large rollouts.

The advantages of working with larger, multi-location fixture companies sound wonderful, particularly to large retailers, if the merged companies can actually meet their goals. The biggest challenge is often combining independent, entrepreneurial companies. IDX has tried to meet the challenge by keeping the focus on satisfying its customers' needs. RHC says it is marshalling its 11 different divisions behind four core companies, each focusing on a different market. Several other large fixture company "acquirers" have kept the individual companies operating as separate entities in order to maintain the customer orientation and entrepreneurial attitude on which they were founded.

Jane Shea, project manager of planning and construction for Barnes & Noble, recently told NASFM members how concerned she was when she first found out that several of her fixture vendors were acquired under the much larger Leggett & Platt corporate umbrella. She didn't want to lose the ability to select her fixture manufacturers, and she lamented "the loss of some great people� people are still the most important aspect of our business," she related. Leggett & Platt worked with Shea to create separate billing and separate accountability for the individual companies under the parent company's umbrella. She also insisted that she maintain one-on-one, personalized contact with the individual companies.

Shea went on to note that the positives of supplier consolidation for Barnes & Noble included deep pockets and buying power, access to technology, and knowing that a large order for B&N was not going to bankrupt her vendor.

If All-in-One Isn't Everything, Try á la Carte

A broad range of services under one roof is not necessarily the only way to go for large or small retailers. Several small to mid-size fixture manufacturers have formed "peer partnerships," stopping short of officially merging, to meet customers' needs on specific jobs; other fixture manufacturers offer complete project (translate "outsource and supplier") management solutions.

Some retailers might prefer to exercise more control by choosing each different supplier on a project "a la carte." A smaller fixture manufacturer might fill a special niche, offer more personalized attention, or can maybe respond quicker. And if the job is smaller, a smaller vendor can often offer more cost-effective small scale production, or provide a more design-oriented product. Ultimately, the choice comes down to personal relationships and getting the service level appropriate to meet fixturing needs.