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Why We Will NEVER, EVER, EVER EVEN TRY To Do What You Do.

Hmmm....lots of talk bouncing around lately as more and more vendors, and other industry providers are leaking news that they want to do what YOU do. The pitch goes something like this:

"Hey, do you have a tough client that you really don't want to try to service anymore? No problem. We'll do ALL the work, including the customization / personalization, all the fulfillment, even the shipping, and you can just sit back and collect a check."

I've got to be honest. I absolutely CANNOT BELIEVE that people are falling for this line of crap! It reminds me of the old line..."Hello. I'm from the government and I'm here to help!"

To be fair, there is absolutely nothing wrong that these supposed "partners" of your business are seeking to eliminate the middleman. With everything changing so rapidly, it's an interesting, strategic "play." Everyone is focusing more and more on the "Value Chain" and are keenly obsessed with cutting out costs and time-to-delivery. As we see it, the problem with it is this--they view YOU as the middleman, and inherently they believe YOU really do not add enough value to justify your existence in the chain. And they think you're too stupid to figure out what they're up to. Think of it this way--would you say "YES" if a representative from BSN came along and made you the same offer?

Direct-To-Team is all the rage these days as numerous (often equity-funded) businesses are setting up new, disruptive business models and streamlined operations to "greatly improve efficiencies" and to"provide better quality and more responsive service to the end customer." In other words, they believe they can do what you do much better, and really don't value the services you offer. In fact, many of them have raised a lot of Venture Capital money to help them move more quickly. Don't pretend for a second that they don't have their sights set directly on YOU! They see YOU as the link in the value chain that is the weakest, and they are desperate to cut you out. After all, the clock is ticking as the industry transforms, and they have approximately 4 - 5 years to return a minimum 5-10 X multiple to their VC firms to justify their investment. No offense, but simply being "trusted partners" by kindly offering to take the more burdensome clients off your shoulders is likely not an act of kindness or goodwill. Nor is it a path to the scale that will be needed to provide a generous ROI to the VC firm. Let's say it like it is--it's nothing more than a blatant strategy to squeeze you dry of your best clients and dump you at the curb down the road. And here's the best part of all...

They have full and unencumbered access to all of YOUR data--your client lists, your contacts, all historical purchases, your pricing, individual purchases--the whole shebang! And they've been packaging and selling it without your knowledge for the past several years. So what's to stop them from using YOUR OWN DATA to replace you in the future?

(Please refer to this previous post on DATA)

Truth? We are TOTALLY blown-away with the incredible dedication, perseverance, creativity, capital investment (and risks), hard work and 24-7 availability it takes to serve and support clubs, teams, leagues, and organizations. Who does your team representative call late on a Saturday night when one of the parents is upset that her Johnny got the wrong number? Frankly, most do it well, but some do not. Those who do not will likely go away anyway as the market continues to consolidate. HOWEVER, there will always be room for dedicated, creative, service-obsessed professionals who engender the trust of the clients, and who earn it each and every day. Having a community-centered, local presence will win every time.

So, it comes down to this. TUO is a technology company, first, foremost and always. In fact, the TUO team is comprised of people who have launched numerous technology products, innovations and even companies. In fact, even doing funding of new technology concepts along the way. So we know the game--and know it well. Being experts at technology is the core of what we do--not trying to recreate the value of what our Dealers do. Our Dealer clients are the soldiers on the ground, doing the tough work day-in, day out. In fact, our belief is they play the most vital role in the Value Chain. No smoke being blown. It is the partnership and combination of the two that leads to real success--having a dedicated, service-oriented team of people, paired with the best online technology money can buy, both working together in a TRUE partnership. In our humble opinion, that will always win in the end. And we've seen it work first-hand as companies such as BSN (and others) enter markets aggressively and then slink away, time after time. Money alone has proven to not overcome poor service, poor quality, no accountability, and artificial local, community-centered presence.

The money people will always think they know better, and believe that money alone will solve every problem. Sometimes it works, no doubt. But often it does not because their are MANY factors that go into the delicate balance between success and failure. Just ask the people from Dick's. At the end of the day, the people on the ground will always be the key differentiator in any business. But that will not stop many from trying as the industry continues to shift and change.