AB Pricing

Stuntman

Member
Join Date
Mar 2012
Location
Arkansas
Posts
33
Is there anything that can be done about getting better pricing from an AB distributor or possibly using a different AB distributor?? I am getting my lunch handed to me on prices when competing for work. I have had 3 different potential customers send me an exact part list to be quoted against competing integrators. 95% of the parts are Rockwell/AB. I am fairly young and the potential customers have said they want to me to get there business but they say it really is about price. All three customers have given me what the lowest quote or price that they received and on all three my material cost is more than the total cost for my competitor to even to do the entire job. I am mostly getting a flat 15% off msrp on AB hardware.

I have worked for two different integrators in the past one was a smallish 2 man shop with yearly sales in 250k-800k range depending on which year you look at. The other integrator had about 10 people working in house sales were 3-4million range.

The smallish integrator had some of the best multipliers i have ever seen. Typically around 40-50% off msrp.

The larger integrator was in the 25-30% off msrp.

I am just ticked off. As a small startup I have missed some huge opportunities because of the crappy pricing. My AB distributor could care less if he had my business or not.

There is always the option of not using AB all together. Unless the customer specifically specifies, and even then quote him the option of using my preferred non AB controls instead.

People will talk about local AB support, to be honest if I really need support I go to the knowledge base or call tech support. Which is what my local support guy does. He brought a demo by that had a smc softstart in it. I was like is that a soft start. He was like I am not sure what that is.

And another thing I keep asking myself why should even buy Rockwell products when they do integration work themselves. Basically supporting my competitor.
 
Those multipliers sound about right for large integrators. It all depends on how much AB stuff you sell. Can your customer buy the equipment instead, and you just provide your services?
 
are they really showing you your competitors low bid or just saying it to see how low they can get you. even with 15% off you should be competitive. AB does not give and great discounts unless you buy large quantity of product on a single sale ( or in a short period ). what your saying really makes no sense. unless your not bidding the job properly.
 
Dare I say it, grey market import may be the way to go. Obviously there will be warranty issues, but that's the risk you take when you go outside the normal supply lines.

I'm in a slightly different situation working in-house for a manufacturer. We buy low quantities, so we rarely get the high discount (nor expect it), but if I'm paying top dollar, I expect good service from my local rep. When I get neither, and am still forced to use that particular product, I have no problem in going outside my local distributor.
 
Bid job properly? I will give you an example of the last bid I lost out on. I am very confident I have what my competitor quoted the job for.
It was for an OEM that is unhappy with there service from there current integrator. I was given the current drawing of the electrical controls panel. SS 24x24 enclosure, 1 powerflex 4 (1/2hp), disconnect, terminal blocks and a couple of safety relays, safety switches etc. No PLC. My cost for hardware and shipping=4,763.44 My competitor price for hardware, shipping, and labor. 4900.00


I even tried paying cash up front instead of net 30..no difference.
 
Last edited:
Put yourself briefly in the financial shoes of the distributor.

He's giving the large integrator a good discount in exchange for aspects of the business that can be quantified (volume purchasing) as well as aspects that are softer: brand allegiance, long periods between negotiations, access to follow-on business at end-customers and new customers, and end-customer satisfaction.

You might be a brilliant engineer with a heart of gold, but you probably don't have all of those things to offer him.

Think about what you *do* have to offer to your distributor.

From what I can tell by your limited posts here, you're not offering brand allegiance, because you've said that A-B controls are not your preference.

You're not providing long periods between negotiations: he had to write up a competitive quote for a half-horsepower drive.

You're not providing access to a new customer: the distributor is going to sell that same drive to the end customer via the other integrator, just at a lower price.

So what's going to get you a better price ? Find something that you have that's of value to your A-B distributor.

It might not be something that's priced in dollars.

Maybe there's a salesman who needs to get X number of new customers for the new CompactPowerFlexPoint product in order to hit his agreed-upon sales goals with his manager.

Maybe they've got some stale stock on the shelf that you could use.

Maybe the RA regional manager needs to show industry segment growth and you're a guy he doesn't do business with yet, but you can promise him a success story that he can put into his quarterly report to his manager.

I had a tiny one-man integrator who I used to bend over backwards for, even though he was consistently the smallest dollar volume integrator we had. He wasn't the most sophisticated programmer, and he didn't have a technical niche. But even in the lean years, he always paid for his TechConnect contract, and that made him so much less of a headache than guys with twenty times the volume who would get technical support at no charge by screaming at me that they were switching to Siemens.

Purchasing decisions are never only about price. Take careful note of the expression used by purchasing agents who tell you it is: that's their bluffing face.
 
SS 24x24 enclosure
Try Saginaw or rittal for this item and ab for the rest. If your costumer is telling you can have the job if you drop your price DONT DO IT! If he is telling why you did not get the job then use your feed back to find ways to save money and be more competitive.
 
Some distributors are better than others. I live in Portland, Or and I have the best support from our local guys (some I'm sure that Ken knows). I work for one of there larger accounts with a good discount but I got the same service and price from them when I worked for a company who was much smaller.

When I first started out building panels I had to be creative. The first panel I built on my own there was over $40,000 in parts. I explained the position I was in and the company that I built the panel for purchased the parts. They got a better price on the parts and I just charged them labor.

Sell yourself!
 
We all speak about the multi-nationals and Monopolies.
Why is ,that the Techconnect is based in the thousands and this is the only PLC Mfg. that charges at this rate?
The distributors then advertise those who pay the most. Fair enough, isnt it?
This is a lisence for both Rockwell and their associated distributors to Print money.
At the moment they have the advantage, don't they?
My previous employer had not paid the techconnect contract.
He bought a new interface unit - around Au$1800 .
With luck the Sales rep loaned him the latest disk for the drivers.
Everything else you buy from other suppliers the drivers are available.
This is becoming an expensive, huge profit making, joke.
Schools teach with cheaply supplied AB PLC's...

Thats my rant for the day - Now I will get back to work
 
Every industry has an 800lb gorilla and some have more. The mill I work for has both AB and Wonderware for HMI's. We have six mills on TechConnect and we pay more for the single site Wonderware support. Wonderware support is horrible and I can't stand the software.

Several years back I went to Parker CTC training. The training was free, the software was good and the support was great! But nobody wants Powerstations! What I generally will do is buy the AB hardware that is required and then look to other companies like the green circle with glasses and a smile. I also have bought from places that sell used PLC stuff but as stated above you need to really watch what you buy. If you buy an old L55 ControlLogix processor and you want to do anything that requires over version 16, you will be disappointed.
 
Do I think A-B is overpriced? Sure. Do I care? No. When we build a machine for a company that uses A-B as their 'standard', they are more than willing to pay the premium that we have to charge for A-B components. Therefore, what incentive does AB have to lower their prices?

🍻

-Eric
 
Ken,
AB controls are my preference, but If I cannot get business where I have to bid competitively why waste my time even bothering looking at AB for a controls source in those types of bids.

I prefer to sole source for a single distributor/brand. Makes life easier from quoting, to drawings, to programming. I am not going to say ok i will use ab for non comp bids and xyz comp for comp bids. It all or nothing.

I guess my view is I am my distributors customer. My customer pays my bills and I pay my distributors bills.


Lets look at my multiplier for 90% of the products AB makes.
.85
Lets say I do a panel with 5 powerflex 4's that are 5HP each
retail is 807, my cost for the drives are 3429.00
My competitors cost at .65 multi is 2622.00

He has to put over 800 dollars worth of labor into the panel for him to be at my cost to even purchase the drives. Not gonna happen.

I do not want to switch but I will not because I want to but because of the have to.

This was providing access to a new customer, they are out of state and not even on the radar with the local AB dist. I made it very clear.

Maybe my goals are not aligned with selling AB I am not there sales guy. I will tell you something that helped me get my first job on my own. I cold called a manufacturer to set up a meeting to talk face to face about what my company can offer. When I had the face to face meeting he said usually his AB distr. introduces him to new service providers. I explained I could have had them do that but that would mean i would be somewhat obligated to sell the distr. product solutions. I told him I would rather provide him the best solution for the problem regardless of the brand. I have been his integrator ever since.

I am here to help US Manufacturing.
 
Do I think A-B is overpriced? Sure. Do I care? No. When we build a machine for a company that uses A-B as their 'standard', they are more than willing to pay the premium that we have to charge for A-B components. Therefore, what incentive does AB have to lower their prices?

🍻

-Eric

Exactly 🍻
 
Do I think A-B is overpriced? Sure. Do I care? No. When we build a machine for a company that uses A-B as their 'standard', they are more than willing to pay the premium that we have to charge for A-B components. Therefore, what incentive does AB have to lower their prices?

🍻

-Eric

Well,
We used to buy AB circuit breakers, now we buy from Cutler Hammer, used to buy AB pushbuttons, now we buy squareD, used to buy AB HMI's, now we primarily use Red Lions.

Now, AB has cut there prices on these items trying to get the business back (almost half on many of these).

We're are fairly loyal to our distributors, but also expect them to get us the best prices possible. I don't ussually give much warning, when I switch; and don't often switch back easily, when I find something else I like.

I'm looking for the best value and quality for my customers... I expect the same from my distributors.
 

Similar Topics

What's the deal with Allen Bradley pricing. We are starting to purchase a decent amount of HMI's and processors from our local vendor, when asked...
Replies
13
Views
1,074
Im using Kepware for comms between a Panelview 1250 and a power transducer via modbus tcp. Im a little confused on the Kepware software, Im using...
Replies
3
Views
783
I need a new 1784-u2dhp, and I am getting quoted $5000 CAD for a replacement communication adapter, which is as close to highway robbery as it...
Replies
8
Views
3,134
My employer is closing this week so I am thinking of going my own for a bit but never done much on the business management end of things. What...
Replies
15
Views
6,653
The secret world of software pricing. My question is, why does Studio 5000, Factory Talk view SE and Factory Talk view 100 Display increase by...
Replies
7
Views
5,128
Back
Top Bottom