Rolf C. Hagen (USA) Corp. (Mansfield, Mass.), a leading supplier of pet products for more than 30 years, in February unveiled a new program to sell its entire line directly to all specialty retailers—regardless of their size.  

“HagenDirect is the foundation for being the premier supply chain partner to the specialty pet trade,” said Trevor Hagen, general manager for Hagen’s U.S. division. “Our goal is to provide our partners with an unsurpassed level of customer service and easy ordering, making us more responsive to their needs.”

To implement the HagenDirect program, the company doubled its U.S. employee base, opened a 120,000-square-foot warehouse in Fontana, Calif., to complement its 300,000-square-foot facility in Mansfield, Mass., and installed state-of-the-art picking systems and ordering systems.

In an exclusive interview with PET AGE, Rolf C. Hagen Jr., president of Rolf C. Hagen Inc. (Montreal), explained that the company’s decision to sell directly to retailers—as it does in every other country where it operates—was a matter of survival.

“This is about surviving and supporting specialty pet stores,” said Hagen, whose U.S. business model focuses on independent pet stores and pet store chains but specifically excludes mass market outlets such as Wal-Mart and Target.

While the manufacturer intended to continue doing business with distributors, the HagenDirect program puts the company in a better position to grow in a market characterized by manufacturer and distributor consolidation, Hagen said.

“We have developed a strong marketing program with ad tool kits and images. This, plus continued innovation, brand development and competitive prices, will help us find our niche in the United States,” he added.

“We are under no illusion that this will be easy,” he continued. “We won’t know for two or more years that this was the right decision.”

“We feel we’re in a good position to provide HagenDirect dealers with an unparalleled level of service,” said Trevor Hagen. “Through the new program, dealers will have access to our entire line of products, including aquarium, reptiles, small animals, birds, dogs, cats and ponds.”

Retailers’ initial reactions were generally positive.

“It’s not like it wasn’t expected. We went through the same thing a couple of years ago with Penn-Plax,” said Steve Maciontek, general manager of Animal Kingdom (Chicago).

“On the plus side, it gives us a little better way to deal with competition, pricewise and selectionwise. It gives us a chance to buy some products that our distributors were not carrying. So I actually think it’s going to be good for the average pet store,” Maciontek said.

“I think it puts Hagen out there on their own,” said Stephen Creech, co-owner of Adventure Pets Inc. (Mandeville, La.). “With all the consolidation of the distributors in the country, I really think this will be an advantage to us because we won’t be held over a barrel the way we could be. Every time we turn around, there’s one less distributor to buy from. In some areas of the country, you don’t have a lot of distributors to buy from.”

Creech added, “I don’t have to buy Hagen products, so this means they have to earn my business.”

Maciontek and Creech said they were satisfied with the manufacturer’s communications efforts, including detailed binders explaining the HagenDirect program, information on working with the company, advertising and merchandising tools, catalogs and price lists.

Still, retailers expressed concern about the extra workload associated with buying direct rather than through distributors as well as about Hagen’s ability to fill orders promptly.

“I have mixed feelings about it,” said Rachel Creech, co-owner of Adventure Pets Inc. “One, I’m a small retailer—my husband and I do all of the buying, so this means an additional order for me, which means additional work. Two, the worst thing we like to have happen is to run out of something, and I am worried that I might be more likely to run out of things.”

Maciontek agreed. “The drawback is that it’s just one more order that I have to do that I didn’t have to do before. One nice thing with the distributor was that, if you ran out, you could get it in a week. I will have to see how Hagen will do on shipping, returns, etc. I am a little apprehensive about orders coming in over two, three or four days.”

However, he said, his first experience with HagenDirect was positive: “I faxed my first order [on Feb. 22], and I got it [on Feb. 27], so I was impressed with that.”

Rachel Creech also questioned whether product availability—one of the program advantages that Hagen is touting heavily—will improve given that she already has access to a wide range of products through her current distributors. “It’s a matter of whether the price savings will be enough to balance out the extra work,” she added.

“I’m sure there will be some growing pains,” said Stephen Creech. “But if it runs the way they envision it, I would think it would be good.”

For more information, contact Rolf C. Hagen (USA) Corp. at 800-225-2700. [April 2007 PET AGE]