Removing the influence of selling cheap heaters is a priority for companies. It makes them sell better and profit more. Let us take you through a real-life example of an investor.
We have a client that is an importer and wholesaler of truck parts in California, USA. The owner of this company, Oliver, has been in the wholesale truck parts business for over 15 years.
Over the past 15 years, he has accumulated over 300 different customer groups. These include truck parts wholesalers, small truck manufacturers, and truck repair shops.
Oliver sources most of his goods from China for various truck parts. Usually, a customer will request some parts and Oliver’s purchasing manager, Jack, will give priority to existing suppliers and handle them. He will ask the suppliers to recommend a suitable factory. Only when the existing suppliers do not produce similar products.
This working pattern has continued for many years. And Oliver has been very happy working with these companies. But that’s not how it’s always been.
A prosperous prospect
During the winter of 2016, there was more demand. More than 50 customers asked Oliver’s sales staff about two products. These were the diesel air heaters and diesel engine heaters. They said that many truckers want to be able to install diesel air heaters in their truck bedrooms. This was to keep the truck bedrooms at the right temperature, so they could sleep well. Maintain the temperature of the truck engine and to allow it to start.
Oliver started looking up information about these two heaters on Google. This was right after the salesman told him about these business opportunities. He found that the search volume for these two heaters on Google had increased over the years.
When browsing through many web pages, he found the heaters. He realized that they had existed for many years before. It was only because of the market monopoly, that many did not know anything. Also, truck parts wholesalers didn’t have access to the heaters.
In 2015 the barrier broke. Right after Webasto and the Eberspaecher heaters got penalties from the EU. It allowed many Chinese factories to produce diesel heaters. Particularly the air heaters and diesel engine heaters.
Finding a manufacturer
Oliver’s experience led him to this business niche. He was familiar with the imports from China and knew many truck parts manufacturers. This helped him to look for these manufacturers. Ones that were in his supplier system. But he could not find a suitable partner.
So he sought help from his partner factories. He asked them to introduce suitable heater manufacturers.
At the beginning of 2017, there were still no more than five heater manufacturers in China. Oliver’s truck parts suppliers could not find a suitable heater manufacturer either.
But, they told Oliver that they knew of a few companies. Some of which had transitioned to heater production. They expected to have heaters on the market in a few months. Oliver said at this point that it was unfortunate that he did not find them back in 2017.
Finally, after 5-6 months of waiting, in the fall of 2017, there was some good news. The truck parts manufacturer Oliver worked with recommended a manufacturer. He worked with park heaters and thought they would be great for him. He told Oliver that it was one of the largest heater manufacturers he knew of. But, they were still very small.
But, Oliver still asked the manufacturers to provide him with more heater manufacturers. As a result, they found 3 other heater manufacturers to recommend to Oliver.
Oliver asked Jack, his company’s purchasing manager, to contact these four heater manufacturers. When Jack sent an email to the salespeople he got his first reply after 2 days. After waiting for 7 days, he finally received a reply from the salespeople of all 4 companies.
Making the selection
The only thing he made out from these emails was that they were unprofessional. The companies lacked the knowledge and basic expertise to guide him. The usual statement he got from them was unsatisfactory. They said, “Our prices are cheap, our quality is reliable and we have a long experience in production”. It was true that the prices of the heaters by these companies were cheap. Especially when compared to Webasto heaters and Eberspaecher heaters. But the market demand left Oliver no choice but to choose the “largest” manufacturer. In the end, he chose the latter because the correspondence from them was somewhat better. Or so he thought.
Oliver asked the manufacturer to provide a sample before the cooperation. After paying the sample fee and shipping cost, Oliver finally received the sample. It reached him after 26 days from the manufacturer. He asked their engineer Sam to test the sample. Oliver chose to trust the manufacturer, who said they would make changes.
He thought he saw a brand that customers identified more with. To promote the heaters better, he asked the manufacturer to provide OEM services. The producer requested a quantity of 2,000 sets of heaters.
It was a deal even though the order was large. Oliver agreed to the manufacturer’s request and proceeded. He was optimistic about the future trend of the heaters.
Reasons for choosing a credible manufacturer
Various problems in the production process made Oliver exhausted. After confirming the deal, the manufacturer asked Oliver to pay a 50% deposit. He announced that the production cycle would take 3 months. They made a contract, specifying on-time delivery and liability for breach of contract.
The heaters went into production. Jack provided the manufacturer with their logo and their packaging design.
After a month of no news from the manufacturer, Jack emailed to find out the progress of the production. They said the delay was because of pre-selling. And that they were hopeful of delivering the heaters in the summer. The manufacturer’s sales staff informed him that all was going well. This was after a week of waiting for an updated email response from them.
With only 15 days left until delivery, Jack inquired about production again. This time the manufacturer’s side told Jack that there was a problem. It was with the production of the heaters and that it might affect the delivery date.
It was shocking for Oliver when he learned this news. He asked the manufacturer why they hadn’t mentioned that they had pre-sold the heaters. The manufacturer blamed their incompetence. He said that the fact they had only been in the heater business for a few months was to blame.
They did not know enough about the heater and had encountered many problems. This was during the production process. They were hopeful of overcoming them and this was why they did not inform Jack. The delay was for another 2 months.
It was a huge drawback. Oliver immediately contacted the person who recommended the manufacturer. He asked them to execute a solution as the middle party. He said that he wanted them to deliver the product as soon as possible.
The manufacturer said that a two-month delivery time was the only solution. It was the best he could do at the moment after the correspondence. And that they were already working on improvements.
What followed was another long waiting period. Jack kept tabs of the progress and enquired after every two weeks. He seemed hopeful for everything working out well.
But, during the last communication near delivery, the manufacturer informed of further delay. This time by 3 months!
Oliver was furious and wanted to cancel the order altogether. He demanded that the heater manufacturer reimburse the company. As stipulated in the contract. For it had sustained many losses.
The heater manufacturer refused Oliver’s request. He said that all they could do was to provide Oliver with the heater as soon as possible. Being a very small company they could not afford to provide compensation. The manufacturer said that they could not afford to refund Oliver’s deposit. All because the exchange was over for semi-finished products. The best thing to do now is to wait.
After a long wait of about 6 months later than scheduled, they finally received word. It was that the heater had finished production. This was in the winter of 2018 and they had missed the best selling season.
Oliver still paid the remaining 50% of the sale price. This was before receiving the heaters in California by ocean freight.
Why quality matters
After receiving the heaters, Sam inspected some of them. He found that they were of a poor make. What was more they differed a lot from the previous samples. After testing some of them he found lots of problems. To make matters worse, Sam did not know what to do to fix them.
After making contact with the manufacturer, the problem still prevailed. Their solutions did not work either. Sam organized the company’s personnel and tested all the heaters. Around 20% of the heaters were faulty!
The manufacturer said that they would pay for the defective heaters. They tried selling the heaters that did not have problems in the testing. Many customers purchased the heaters for sale. But soon there were many complaints. They said that there were various malfunctioning problems. Like the heaters not working, black smoke emanating, and other malfunctions.
The customers would ask Sam for help, but there was nothing he could do about them. Again they called the heater’s manufacturer for help. The solutions he gave did not work. One problem led to another.
The heater manufacturer would ask Sam to give the customer a new heater and replace the faulty one.
It was not long before the staff realized that the sales were falling. Customers were no longer buying the heaters. Oliver checked with the customers and came to know the reason. He found that apart from their poor quality there were identical diesel heaters. They were available on Amazon and eBay at very cheap prices.
The customers said that they felt that investing in Oliver’s heaters was a loss for them. And they would not buy from him again until their company’s quality improves.
Several others refused to work with Oliver again. All because the heaters were costing them so much money.
This encounter caused Oliver to completely lose confidence in the diesel heater business. It had cost his company over a year’s worth of profit!
He gave up the business and disposed of the remaining diesel heaters as scrap.
Reliability of the Warmda Heaters
At the 2019 AAPEX exhibition, Oliver discovered the Warmda diesel heater. He saw the dawn of restarting the heater business
At AAPEX 2019, we met many customers, among them was Oliver. He asked us to learn more about the differences between Warmda heaters and Vvkb heaters. He also wanted to understand the probability of failure and solutions.
Our staff showed customers like Oliver our entire production process and the troubleshooting. They also informed that these heaters were 100% tested up to 45 times before the sale from the factory.
Oliver showed great interest in Warmda heaters. He told us about his previous experiences in selling diesel heaters in China. He invited us to visit his company in California.
After the show, we went with Oliver to his truck parts sales company.
There we showed all the products of our company from 1996 till now. We walked him through the history of our company. And told him about the relationship between Warmda LLC and China. Oliver started showing great interest in our heaters after seeing our products. He was particularly interested in air heaters, diesel engine heaters, and fuel heaters.
With his last experience, Oliver said that he could not order too many heaters. We agreed with him and told him that he could order in small quantities instead. We ensured him that our cooperation was for the long term. If his customer agreed with the quality of Warmda’s heaters, he could buy them in large quantities.
We also told Oliver that the Warmda heater website was very comprehensive. It has detailed notes on everything to do with the heaters. Like their installation, upkeep, etc. When a customer sells a heater, they need to pay attention to these installation details. This will ensure that the probability of the heater breaking down is low.
Oliver surfed through the Warmda website on the spot. This was to see the installation notes and confirm that they were effective. In the office, Oliver handed us an order for 200 sets of diesel air heaters. Our staff immediately passed the order to our factory.
One hour later, our workshop supervisor said that the delivery time for 200 sets of heaters was 7 days. Oliver was both happy and surprised with our work efficiency. He wanted to have the diesel heaters for sale as soon as possible. We agreed on the spot to send the 200 sets of heaters by air.
After only waiting for 12 days, Oliver received the Warmda heater. When our salesman returned to China, he took some production photos. These were of the heaters and sent them to Oliver. This was to let him know that the production of his order was in progress. Oliver said that he was very satisfied with this service.
About a week later, our staff told Oliver that his heaters were ready. We would send the goods to him using our freight forwarder. The next step was the normal logistics channel.
After exactly eleven days after the first order, Oliver received the Warmda heaters.
Quality ensures Profit
The thorough processing and product quality of the Warmda heater was popular. It impressed Oliver’s customers.
His previous encounter had left him feeling a little apprehensive about the ordeal. But after inspection, he was confident of their quality. After receiving the heater, Sam inspected them. When he opened the heater’s packaging, he saw two boxes. One containing the main unit, and the other containing the Warmda heater’s accessories. Opening the box containing the main unit, he saw that the heater rested on a cardboard sheet. It lay covered with a heat shrink film. All these details showcased the professionalism of the Warmda company.
Soon after testing Sam informed the team of the heaters working well and with low noise. After testing 50 units, Sam told Oliver that he didn’t think the Warmda heater needed any more testing. It was clear that these tested heaters were different from the previous products. The likelihood of heater failure was very low. He said he had never seen such a perfect quality of heaters before.
So, Oliver’s sales staff began recommending the new heater to their customers. The top-quality Warmda heater. At first, the customers were skeptical of the Warmda heaters, but soon they saw the difference. It was not long before these customers started to trust Oliver. They started to buy samples of the heaters in small quantities.
Soon after, Oliver received many thank you letters from customers. They talked about the heater’s perfect finish, quality, and durability. The performance was amazing. It started turning many customers into raving fans of the company. Word of mouth spread around which resulted in a lot of extra profit for them.
Warmda heaters have allowed Oliver to grow his business and gain some more customers. After receiving this feedback from the customers, Oliver was confident. He started a second order and made even more profit than the previous batch. There was consistency in the quality same as before which made Oliver gain trust in the company.
We also suggested that Oliver buys some fuel pumps and glow pins as common parts. This was to provide a timely solution to the customer if something went downhill. As a result, he was able to give timely repairs if anything occurred.
Through some exchange meetings, Oliver met more customers. Some of them worried about finding a suitable diesel heater manufacturer. They were quick to show interest in Warmda after Oliver spoke well of them. They sought to understand the heaters. As a result, many dealers and Oliver established a partnership.
Now, Oliver is seeking to expand his business. Oliver is already placing more orders and bringing a diverse range of Warmda heaters into the picture. This is all because many customers are showing interest and the demand has risen higher!