Purchase AB in Europe?

We have several facilities in Europe where we get much better pricing on AB PLCs and related items than here in the states. When I asked our AB rep to match the pricing (or at least try to come close), I was basically told NO and don't try to buy it out of Europe. They said I'd lose support here (which I can understand since they're not getting the revenues), but they also made it seem like they would make my life very difficult -- They already tried to go above my head to our plant manager! Another story completely...

My questions:
1) Has anyone else had the same experience of pricing much less in EU?
2) Has anyone gotten AB in the U.S. to match the pricing?
3) Has anyone purchased stuff from EU and shipped here?
4) What are the pros/cons from your experience?

Thanks!

If some (non US) steel company have good price in US market, the US coverment put extra taxes for imported steel even prices are the same in EU (or where ever) and in US. Is this what you call free marked ?

If AB's prices are lower here, it means You pay that dumped price differences in your prices. If they equlizes prices, your prices lowering and EU-prices goes upwards. So. your companyes supporting AB prices here not directly your coverment, but final result is the same.

We have bad manner select lowest price plc and not calculate software or other indirect costs, so AB's must be near Simatic (and others) prices.

Hi Drew,

I think that your AB rep is wrong, but it might be impossible for a small customer to get his way without a lot of legal wrangling, and who wants that ?

If you can get AB parts at a lower price from the EU, then go and get it. It is possible that AB don't want to provide parts warranty in the US, but the EU sales point can't deny it. You might have to send a defective part back to EU for replacement.

Support in the shape of manuals and online support, you probably have it already.

I think that AB is quite arrogant to have double price policies. Maybe thay have such a strong position in north america that they can "milk" their customers for some time. But such a strategy wont work for long, it makes existing customers start looking elsewhere thereby slowly eating away at AB's market share. It's a losers strategy. A pity though, AB has a good product, but I feel that they are on the defensive.

Drew,

As I have stated before AB is not a true global company. This is the reason they are as seppoalanen stated dumping product in EU. The true AB is showing through on this one, their strong-arm tactics in to scaring you to buy here is nothing but them acting like a bully. They are just mad that you have found out that they don't dominate the world market jus the US market, so us here in the US are having to pay the price for their attempt at taking over a market which they have no chance of winning.

I hope you either buy all of your AB from EU or change vendors; this is the only thing these guys understand or care about. Their bottom line.

Mike

What "support" are they threatening to take away? Actually they have the spoiled child syndrome more than bullying. The people who built the company from the ground up aren't around anymore, just a bunch of people who "inherited" a good company that don't have the skills to stay in the running, in spite of having good products. It's an arrogance that only people who haven't had to work for what they have seem to aquire.

I had an AB rep have a little tantrum that we were using Banner Photoeyes on site. I told him that the big reason we will keep buying Banner is that we have about 300 of them in service, just like we will keep using AB PLCs only because that is what we have now. He had trouble grasping the reality of it all. I think they spend too much time in sales seminars, etc. Maybe they are controlled by $cientology or something.........

Economics 101

I've had this argument brought to me by one of my customers who has a division in the Netherlands who buy at a significant discount compared even to his large OEM discount in the USA.

To Mike's chagrin (how's the knee reflex, buddy ?!), it's not about arrogance or bullying or hubris. It's basic economics for a company building market share in a market dominated by it's major competitor, and (shocking!) it works in precisely the opposite direction across the Atlantic for Siemens.

A discounted price does not represent a "true" price.

How do you build market share ? Rock-bottom prices is one way to do it. You can afford to sell a few thousand controllers at very low profit. So why don't you sell all of your controllers everywhere at the same low profit ! Huh ?! Ya big greedy meanie !

Because you can't afford to sell ALL of your controllers at that low price. This is a fact in ALL markets, not just industrial automation.

I have to agree with Vetteboy; it's more a spoiled child thing. 'If you don't let me pitch, I'm going to take my bat and my ball and go home!!!'. And back in the day when AB had the only decent ball in town that might have worked. But now everyone playing the game comes to the ballpark with a bat and a ball, some of them better than the one that AB brings. And all the other guys want to do is play right field and bat once in a while. So people aren't just too concerned about AB goingt home anymore.

OK, so it's spring and I'm wound up about baseball and I took the analogy thing a little too far. And, yes, the Brewers still suck!!!

Keith

I can back up Ken Roach on one thing - Siemens and others do exactly the same thing in other parts of the world that AB does in the EU. Also you might consider that purchasing components overseas and shipping them here would incur import duties to the US Government. Or were you just going to let them slide through without declaring them? I have dealt with this issue many times and you would be amazed at how much you can be charged just to bring parts into a country. At times the duty has been greater than the cost of the part!

Ken,

My knees are just fine thank you!

As for your response it still did not address the issue of YOUR Company telling Your Customers that they will not be supported if they buy YOUR PRODUCTS in EU and send them to the states, because it cost YOUR COMPANY MONEY.

I guess your definition of being "arrogance or bullying or hubris" is not the same as the rest of us.

Mike

Bussiness is bussiness. AB will charge as much as they can! In Europe they are not the most popular so they try to capture some of the market with lower prices. In the US they are very popular so they charge as much as they can. There are no rules in a dogfight!

The problem is the customers don't want a fight. They just want to accomplish something. They want to build something. When you are doing something only for the money, it shows, and people look elsewhere.

Vetteboy, you said "When you are doing something only for the money, it shows ....". I think that is a little unfair to A-B, and you know I am not their biggest fan! I run my business to make money too, and I'd bet most of the guys here draw a paycheck for their services. I like to think I am a professional, and I have the business I own because I love the work, but that of itself doesn't make me superior or mean I'm not in business to make money. I'd be real surprised if making money wasn't the primary purpose for any of the vendors I deal with.

As far as the pricing issue, I don't think there is anything wrong with different pricing for different markets. I do the same thing - if I have a lot of tough competiton on a specific project I sharpen my pencil a little. Most companies do the same. The A-B rep that is whining and threatening has a right to do that, but I'd find an alternate supplier anyway if I could.

A-B can suggest pricing levels for all of their distributors, but in the US a manufacturer cannot legally dictate prices if a distributor is buying and re-selling products. I belive the law is that if the distributor is at risk for their own profit and loss they can set their own prices. That is different from a representative, where the orders go through the factory and the rep isn't at risk.

Now, I would agree that Rockwell has put short term profits as a higher priority than long term profits. And I would agree that this will hurt them long term, which is a darned shame.