In the April 2014 issue of OPI, we reported on an initiative by TriMega called Prime, a cross-group block of large dealers that would be able to negotiate stronger terms with vendors and which would also help to stem the flow of dealers leaving TriMega’s DSC sub-group to Pinnacle, the group for larger dealers founded by Dave Guernsey. Prime in its original form is no more, but the concept has evolved, OPI has learned.
A new umbrella organisation has been created under the auspices of dealer network AOPD that – initially – will include members of TriMega’s DSC and the Direct Purchasing Catalog Group (DPCG), a group of 13 dealers that already work together on buying programmes. The basic concept behind this initiative is the need for larger, stocking dealers to negotiate and buy together, not dissimilar to the reasons why Guernsey started Pinnacle.
One might expect the idea of this umbrella group – a name for which has yet to be decided – to have come from TriMega, but the concept is actually the brainchild of Mark Leazer, Director of Sales Technology at North Carolina dealer FSi, a member of both DPCG and AOPD.
Leazer told OPI that the idea was hatched at the AOPD annual meeting in March where there were several conversations around the theme of how different groups might be able to work more closely with one another without necessarily having to merge. AOPD – a network of dealers as opposed to a buying group per se – was seen as the ideal vehicle to pull the different groups together due to its neutrality.
The notion of groups coming together to negotiate contracts with vendors brings the name BPGI to mind. Leazer admitted the umbrella concept was similar to the dealer group consortium, but said that there were three main differences: aligning the buy side with the sell side; the ability to monitor and deliver contract compliance; and a lower cost structure.
A board comprising representatives of AOPD, DSC and DPCG has already been formed for the umbrella group, but there are a number of key items that still need to be ironed out such as legal structure and funding.
This is certainly an interesting move and one will which no doubt receive more coverage in OPI in the near future.