The new online threat

Speaker A: Welcome to the KBB View podcast. The show all about the ins and outs and ups and downs of being an independent kitchen and bathroom retailer. And this week we're talking about a classic subject, physical showrooms versus online. Now, the fact that you can get some products online at a lower price in the showroom has always been a thorn in the side for independence, to say the very least. But where is that argument now here in 2026? Has selective distribution fixed it? And what are the new threats from online? Is it the likes of DIY kitchens or Victorian plumbing or many others, all coming up the market and starting to overlap with yours? And as AI becomes the new search engine of choice, what does that mean for how consumers find the best information? So here is Trevor Scott from RFK and Rugby. Hello, Trevor.

Speaker B: Good afternoon.

Speaker A: We have Steph Warner from Pier 1 Bathrooms and Hove. Hello, Steph.

Speaker C: Good to see you everyone.

Speaker A: We have Nick Warrington from Stuart J Warrington in Macclesfield. Hello, Nick.

Speaker D: Hello everybody.

Speaker A: And, uh, we have Liz Panting Jones from Lima Kitchens in Milton Keynes. Hello, Liz.

Speaker C: Hi.

Speaker A: Uh, Steph, we're going to start with you because you've unwittingly triggered this discussion because last week you mentioned that you put some new displays in only to then find those products online and it caused you some grief. So talk me through that situation.

Speaker C: Yeah, so since I found out this is the topic we're going to do, it's spurred me to think about it a bit. So I'm going to try not to ramble because it's kind of brought home how much of an issue online is for independent bathroom retailers and why. Maybe it's more of a problem for us than it is for kitchen retailers. So a few things came to mind. Firstly, bathrooms are often modular, so even quite high end design focused ones will be modular. We don't tend to do much fitted furniture. We do do a bit of stone templating and things, but a lot of our bathrooms will be modular. So there is obviously a lot of expertise still required in ensuring all your items work together. You've got appropriate pinch points, your cistern fits, your flush plate and so on. Um, but it does mean that it's generally much easier for customers to sort of curate their own bathrooms compared to kitchens. And so you've got that. And then in the context of the growing number of big online retailers, so like you said, Victoria Plumbing, Bathroom Mountain, and there's more coming on as we speak and they've invested millions in marketing and they do it really well. They've got great imagery and they're often selling cheaper, lower quality products often shipped over from the east, which look great in the images and will often be imitating some of the well known brands best ranges. This has led to bathrooms becoming more and more sort of commoditized. So that's sort of perception that you know, a tap is just a tap, uh, vanity is just a vanity. Just, it's just about what it looks like kind of undermine the whole context of workmanship and um, quality. And um, it means that clients will often just go online and create their own shopping lists and um, cherry pick products to achieve the look that they want. So obviously that's a problem for us as, as the high street independent retailer because people just aren't seeing that they need to come to us as much. But it's also a big problem for you know, our favorite premium big bathroom brands who have been around for decades because they're just losing a bit of visibility online. And actually I was having this conversation with one of them and showroom yesterday about how much of an issue it is for them too. And then as I was talking about in the other podcast, um, you've got the sort of. Some of the better known mid to high end brands are actually selling out to online retailers so offering big discounts for their products online. So it means that customers are starting to use our showrooms as sort of like research centers in a way. So they will come in, see the products in the flesh, um, and then they'll um, find out what the brand is, they'll google it or whatever, um, find the best price and then they'll either just, we'll never hear from them again and they'll go and buy it or they'll come back to us with that price and we'll have to heavily discount and lose our margin. So it's very frustrating especially when we've in the instance I was talking about, invested a lot of money in, you know, uh, our displays based on that supplier trust relationship and then they go and let down. I think the other thing with bathrooms is that we tend to work with a lot more suppliers than kitchen retailers. I might be wrong, but this is the feeling I get. You know, we work with quite a lot of brass. Where's the clothes suppliers and vanity suppliers and mirror suppliers and, and the reason we do that is because we're finding that there's more and more good ones out there that offer something slightly different that our higher end clients want or our design focus clients want. So different finishes, different styles and they'll all specialize in that. And as a sort of independent retailer, we want to find the balance between prioritizing and staying loyal to certain brands, but also being able to offer enough to choice in our product portfolio to customers so that they can achieve the look that they want. So I think that means that we are just therefore more um, vulnerable to brands selling online because we tend to sell more brands. We'll often have five or six different brands within one bathroom. So they'll mix and match what they have. Vanity's one brand, Brassware's a different brand. Yeah, so that sort of just I think makes us generally maybe a bit more vulnerable. And then you've got online only brands and I'm not going to mention any names in case I get into trouble, but brands, uh, are doing a really good job of selling products online and getting really well known which customers, because they do a lot of online research now they come into the showroom and say, I want this such and such bath. And we can't work with that company because I don't work with independent retailers. And so we've lost the client. Unless we can do a lot of work in trying to get them on board with us or we've got this equivalent bath, we offer this service, et cetera, et cetera. We just often lose the client's straight away. And then finally you've got the AI element where they're coming in with amazing designs that they want us to find the products for our help with. And sometimes we can do that, but other times I think AI is starting to provide links now to the products themselves so they can literally just create their own bathroom. And I think it's, I've heard recently it's going to go a step further and you're going to get links to like local installers that are available in the next months that will in then install that bathroom for you. So there's all of that context that's creating a big problem for us.

Speaker A: Well, thanks for joining us on this episode.

Speaker C: I've been thinking a lot about it.

Speaker A: The clock's beating us. It is brilliant because, uh, you can hear how much this is aggravating you and how much of an issue it is for you. You can hear it in your voice because you on the bathroom side as well. Nick, would you concur with what Steph said there for the bathroom perspective?

Speaker D: Yeah, completely. I mean I've got a foot in both camps. Uh, really we don't perhaps do quite as curated designs as Steph does, but we definitely see on the Tray counter. And the way that we sell bathrooms, there are certain products and certain ranges where we find it very difficult to try and compete with certain, uh, online items. And so we don't, we just don't promote those because there's no point. So. Yeah, I agree completely. And I think what Steph's talked about, uh, in terms of, for instance, the AI, where bathrooms are leading, I see that kitchens will follow as well, naturally.

Speaker A: Okay, Trevor, this all sounds to me like the conversation around appliances about 10 years ago and selective distribution seems to have ended a lot of those conversations, but. Yeah. Or was that my misinterpretation of it? Is it more that you just got everyone got fed up of talking about it so they've gone elsewhere?

Speaker B: Uh, well, m. I mean it was, it was twofold. Selective distribution, uh, definitely helped. So relationships that, uh, major suppliers had with, um, independent kitchen retailers were reaffirmed and contractualised, uh, with the selective distribution agreements, which provided you ticked enough boxes in terms of meeting with the requirements of how much product mix you had on display, the variety of it, the training, the, the, you know, everything else that um, you, you added to the mix just added another percentile of discount to your trading terms. All of which resulted in us being able to be very competitive against, um, the Internet for the same product where those terms weren't applicable. So, you know, the likes of ao, for instance, um, huge as they are, they're not actually buying as well as we are for certain brand products because we tick more boxes. So in many respects, yeah, the argument went away and, um, highly relieved it did do. But of course Covid then came along and many of the suppliers had major supply chain issues and many retailers looked at other suppliers to resolve their issues and jump ship. And that jumped ship happened both ways. You know, it didn't all go from one particular supplier to another supplier. People were going, both suppliers are rubbish. We're going to jump ship and go the opposite direction. So it didn't actually make anything that much better, although some will claim it did. But in the fullness of time, that all sorted itself out. But it was a nightmare during that period. Um, and of course what the major brands did, much to their credit, was feel slightly embarrassed and awkward by the very stringent terms of the selective distribution agreements that were in place and didn't feel inclined to be too tough on us during that post period. Give us all a chance to recover and get over ourselves and for them to get over the mistakes that they'd made themselves. But it is starting to creep back in again now. And we're starting to get the odd raised, uh, eyebrow from business managers who are walking around the showroom and doing a quick mental tot up and going, they aren't compliant anymore. We need to have a quiet word about putting another washing machine or another dishwasher on display so we can get them back up to the correct terms. And we're kind of looking, looking at the, the business managers and going, you can try, but we're not playing that game anymore. The market's changed, the world's moved on, you know, but we still, we still want the same terms, but we don't want to play by your rules anymore. Um, and that hasn't gone beyond that conversation yet. So we're kind of waiting for it to hit the fan, as it were.

Speaker A: What about you, Liz? Are you seeing this in things like sinks and taps, you know, the commoditized parts of the kitchen, the stuff that comes in a box, Are you still seeing that in, in those kind of areas?

Speaker E: Sinks and taps definitely, um, is something that we see that in. They're just too readily available and that's across the board. I can't think of any brand that we're particularly confident in and can be very certain that we can supply at uh, a rate which is competitive with online and worthwhile us supplying as well. We do take the stance of we're also offering a service, a recommendation, we'll sort out the issues, but some people don't care and if they have bought it during the install or you want to keep it moving for your installers. So it's to some extent hard to stand by making your clients sort it out because of the knock on effect and therefore cost. But also for us, we do the full project. So we find areas that are outside of the standard kitchen supply a big problem. So anything like flooring or lighting, internal doors, these are all things that we really struggle with and often you can just buy them for less online than what we can on our trade terms. So we win a lot of business because we do the full package, but we don't make any more on it. Uh, we just give ourselves a bigger headache and we find that that's a struggle to kind of argue with our suppliers. It is one that I hope changes though, because there are more and more people coming round to the idea that we have to rejuvenate who we are as an independent market and except that we have to go into more of an uh, interior, uh, Persona in order to kind of win business over the More entry and online, uh, markets and competition. And with that change, hopefully more pressure can be put onto these flooring and lighting suppliers to support us more. But only time will tell.

Speaker A: Nick, what's happening with worktops. How does that work?

Speaker D: I don't know how. It uh, varies across country. I know, I know. What I find here is that worktops is one of those where I like to think that the supplier that I use, he gives us, I think pretty reasonable terms. But I also know that they will quote, uh, retail and that if I was to put perhaps the same margin on that section of the project as I do on other elements that um, it would make me uncompetitive. So that I generally don't put the same sort of margin on a particularly quartz and porcelain as I would on say, the cabinetry. But the flip side is that if people ask you to break out your work surface, I do an all inclusive price on the kitchens, uh, that we quote. So they only get a price for quartz worktops if they ask for it as a lump sum. But if you're too greedy in terms of the, and it's not greedy, but if you ask for what you would consider to be a fair margin, it can price me out of the job. And then we end up having to deal with an or the quartz company which may or may not be as friendly and amenable to us as uh, our regular supplier is. So for me there's a convenience in perhaps dropping the margin a little bit to make sure that we still use our preferred supplier that we know we're going to get a good service off the customer's going to get a good service from because you can give people all the warnings that you like, but some of them will still think that saving 300 quid on a quartz company that travels from 150 miles away to template there kitchen is still worth saving. So yeah, it's a perennial problem.

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Speaker A: It's worth pointing out for the sake of balance here that a lot of the selective distribution models that came out were suppliers generally trying to find a way around the legalities of who you can and can't supply. And I'll come to our uh, official legal correspondence in a minute. But fundamentally suppliers aren't allowed to tell retailers what they can and can't sell things for. They can't restrict who they sell it to and who they then sell it onto as well as the retailer. So it's very easy to blame suppliers for this as an issue, but actually their hands are tied a lot by the law. And selective distribution is a way of fudging that law to a point where they can restrict who they sell it to. Is that about right?

Speaker D: Nick M. Yeah, you've summed it up perfectly really is that the anti competition laws are there to protect the consumer. So the law is not really interested in the retailer. The law is interested in ensuring the consumer can get as good a deal as possible. And so that in some respects has had these laws of unintended consequences of retailers being put ah, at a uh, disadvantage because some of these large online brands were uh, buying even if they're buying at the same price and because of the thinner margins that they will operate on, um, it means that they will discount heavily. The brands aren't allowed to dictate the pricing terms. And so they've had to find a way of being able to offer improved terms to uh, retailers who can do things that the online brands uh, can't. And even then I think they have their own separate distribution agreements with some of the online brands in terms of the promotion of their brands which enables them to give some of them better discounts than others. But it has helped significantly in sort of redressing the balance. Uh, I think as Trevor said, I know even as a small showroom like us, we've had to do that in order to ensure that we can achieve the margins that we want to. So we probably narrow down the range of products that we try to push so we've got access to a massive range but within that there is a narrower niche of products where we know that we can achieve better margins than elsewhere because of those uh, agreements that are in place. So it's there to try and help the retailers. And I do think it's reasonable because we get to a stage where you're coming in and providing all this specification advice and then people plop out the phone and expect you to match a price, uh, where they've not been able to get any of that online, uh, and then expect you to Match that discounted price.

Speaker A: Well, let's move on a little bit, Liz, to. I suppose the other bit of online, which is online retailers themselves would always been the very low end of the market. But as we discussed a couple of episodes ago, those kind of retailers are coming up the market and suddenly you are overlapping with them. Do you get people coming into you with a, uh, DIY Kitchens quote, for example?

Speaker E: We don't get them coming in with the diy, ah, Kitchens quote. But what we do get is people going away and then putting what we've got or trying to compare what we've done into DIY and saying, but we can get this 25% less, for example, and then it's gone. I think one of the. One of the really interesting things is DIY does look good and they have a lot of positive feedback out there. And for anyone in the industry who, like myself, taunts themselves by being a part of the online forums in some vain hope that we'd pick up at least one lead, they do seemingly do a good job on the whole. But, uh, when one of our designers was on maternity leave, they happened to be close to where the DIY showroom was. So they went in and took a look, look. And they said, the showroom is impressive because it's expansive, but the product itself isn't on par with what we do, whereas the marketing would make it look like, and, um, sound like it is. And I think that that is the difficulty that we therefore face. How do we constructively say to a client, the product isn't the same, it isn't the same quality. Are you sure you know what you're, you know, you're investing in here? Is this something that you're probably going to need to start maintaining a lot sooner than a product that you would buy from us, um, or even replacing a lot sooner. And it brings me back to how do we, as, uh, an industry charge for design? Because that is what happens. We tend to get it in peaks and troughs. So we've had a burst recently of people who have gone to DIY kitchens and we know we've lost against them because the other local competitors that they've gone to, I've dropped him a message and said, did this client buy from you? We were up against each other. Have they gone with you? No, they've gone with DIY because that was their three. Their three quotes. So we know that this does happen, um, which is really, really frustrating.

Speaker A: Are you seeing this from the likes of Victorian plumbing and, you know, et cetera? Et cetera. Steph, are you seeing the kind of overlap happening?

Speaker C: Definitely. As I said yesterday, we had one of our core suppliers in very well known brand, high quality, premium brand, and they are having to change the way they work. They do work on selective distribution and we are one of their retailers. And the online isn't just, as I was saying, a problem for us, it's a really big problem for them. And basically what they're doing is they've gone online not to sell. I mean they had a website anyway. But they're starting to sell their products through another third party website, not at discounted prices, but coming with that. They're also reducing our terms, they're reducing their retail price and reducing our terms. So we're sort of pushing back to say, hang on, you know, all I'm hearing here is negative for us. But he's trying to explain from their perspective that if they want their brand to survive, they've got to do this. And actually it can, and how it can be beneficial for us because you've got all these imitations coming in on Victoria Plumbing, vanity units that look exactly the same, taps that look exactly the same with just nowhere near the quality. Ah. And their visibility of the higher browser just is just sort of being uh, clouded over by that. And so I actually was sat there ready to sort of say, no, we're not happy about this. And as I listened more and more, I could actually see it from, from their perspective as well. So it is really difficult, I think, to find that balance. And uh, they've justified it to us that they will, via that third party website, be pushing people towards our showrooms to see the products and things. But yeah, I mean we're seeing that huge crossover with the, the products that are available on Victoria Plumbing and, and what we can get, but they're just not the same products.

Speaker A: No, but equally we saw this in, when the market's been depressed before is that, look, big manufacturers have to keep the factories busy and they have to chase the volume wherever the volume is. And if there isn't volume coming through independent showrooms and they've got to, they've got to go over to where the volume channels are, which a lot of which is retail. Now. A lot of brands have got themselves into all kinds of trouble with that in the past because of course then you can't take it out of that when the market returns. But you got to feel for them. They've got to, they've got to sell their taps or they've got to sell Their whatever it is. And to do that they've got to go where the customers are. Um, look, we touched on it a little bit already, but let's talk about AI a little bit because AI has become the, you know, it's the new Google, isn't it? It's a new search engine. But what it will do, unlike just delivering a load of links or a load of suggestions, it will actually recommend things and tell you what you should or shouldn't be doing with it. So Nick, you're our official AI correspondent as well now as you know. So what's your thoughts on this? On if you just go to ChatGPT or Claude or whatever it is and just put in, I want a new kitchen, you know, what's the best thing? How much is it? Where should I go? The answers to that are very direct and very clear and they include links. How do you feel about all that?

Speaker D: I think it is a really big challenge for independent, uh, businesses. A really big challenge. I think that as an industry, uh, independent we've probably taken quite a lot of time to hone our understanding, uh, as it was of SEO. So Google, et cetera, keyword, so search engine optimization, getting all your keywords and your website and all this sort of stuff. And that is important. And um, when people search because of the way that that's set up, you will turn up in, you know, the local searches, irrespective of the big uh, retailers being just down the street from you. I think the problem is that when you then look at the way AI does its searches, keyword in itself is not good enough to keep AI happy. And the main reason for that is that the LLMs, so Chatgpt and Claude, et cetera and uh, uh, are that much better at searching, that they can do much more specific interrogation of what's out there on the web than SEO. And so that means that they give more accurate results for people. So people don't have to search around as much. They tend to get a few links and those, those links are really useful, but if you're not one of the links, they ain't coming to see you anymore. But the problem is for your website it probably means, uh, and sorry to break it to you all, that you're probably going to have to sit down and completely review the way your website is structured because if I can try and describe it, is that the way we've historically uh, set up our website is that we create this big wide funnel that you're trying to get a load of people to Fall down. And as long as you've got enough keywords in there, uh, Google will help you with that and you'll get leads dropping in. What AI does is said, what you've actually asked for is, uh, a micro shaker, uh, door painted in light teal, um, and they will go and find you the supplier that does that and give you a link to it. So your website all of a sudden has to go away from being this sort of broad church to have real specific knowledge and detail in there that, that the AI bot can crawl your website and find and go, do you know what? Nick Warrington does a really good design and he's got this micro shaker and it's available in these colors and, and that's the sort of level of information that they want. And again, going back to big boys versus the small independents, the bigger businesses are able to, you know, have this big website with lots of very deep, specific channels of information in that the AI bots absolutely love and adore and end up, uh, directing people to. So my big recommendation to everybody, if you've not done it, is to start trying to understand how AI works and how you probably need to look at how you are, uh, describing yourself on your website and whether you actually need to appraise whether that positioning is correct and whether you need to redefine that a little bit in order to suit AI, because the balance is gradually going to tip like that. There's less leads coming through traditional Google and AI is just going to pick up more and more and more, whether that's Gemini or ChatGPT or whatever.

Speaker A: But of course you can use AI to help you with that, Trevor. So you're literally doing this as we speak virtually, aren't you?

Speaker B: Yeah, I've just been jumping up and down in my seat and sort of like shaking my hands up and down in the air while Nick's been talking there. Our new website is, um, a matter of weeks away from launching and it's huge. The expectation isn't that most of our consumers will actually read 9/10 of what's on that website. They will target in on the very specific bits that they are interested in once they found us. Now how are they going to find us? They're going to find us because the website that's being created is intensely AI, AI friendly. It's been geared and designed around how AI searches for information about fitted kitchens and, uh, picks it up from us and we become one of the focused, um, sources of information that then we get acknowledged in the search parameters. That come up on ChatGPT or whichever, Claude or whoever and that has been, you know, I mean I almost want to swear because that has been an uh, ahead fcuk for me to try and get, get my head round because this is so far left field to anything that I comprehend or understand and it's been my job to work with the website developers and our uh, marketing company to make sure that we understand what we're doing and why we're doing it and how we're doing it. The amount of edit work that's been required has been staggering because there are so many pages but you need to have them because as Nick has just said, if you, if somebody wants to find um, you know, a sky blue micro shaker with knobs and handles from a certain supplier, you've got, you've got to tell them that you can do that. Um, even if nobody actually finds it themselves on your own website, I will and I will tell them.

Speaker E: Currently just typing into AI a couple of things noted from these guys. So where's my AI tab gone? So I've been, I've been doing this and I have gone through, I've updated lots of things on the website. It is running on a really old platform but it's ranked really well and we do, we, we ask everyone where we get leads from um, and we do get leads from AI. So I am very reluctant to start with a very new structure. I'm nervous about how that may affect the listings but we are going through and updating things. We can make those updates on the back of what we've got by adding to it, changing the details, updating keywords and search terms and utilizing AI to tell us what is being searched so that we've got the right terminology linked uh, to the project or the pages or the relevant information. So it is something we've been doing in the background over the last kind of six months. The really frustrating thing though is how quickly it updates because it just changes constantly. So you've constantly got to do it and it does now feel like a full time job which I can't afford to outsource, I can't afford to employ someone to solely do and I most certainly don't have the time to stay on top of it. So there, there has to be something that kind of changes or gives or collective kind of way forward. I don't know.

Speaker B: This is where I think using an outside marketing agency to assist and give you back your time um, is so important. Now granted, as Andy's often mentioned, we are of a slightly bigger scale than you guys, but nevertheless, I mean, you part with as much money as you're comfortable with, um, to a marketing agency. But if they're doing their job right, they're pointing out all these things to you before it happens and giving you the opportunity to correct it and go in slightly different directions.

Speaker E: But as someone who has done this for themselves for such a long time, when I've spoken to four different agencies and what they've given me is the most generic things out there, I don't want to look like everyone else. I want to be unique. I want it to be in our voice. And you lose that or you're at, uh, risk of being able to lose that, um, which could again, just be the control freak in me needing to let go.

Speaker A: Well, I'll tell you what we'll do, right, because the clock's beating us a bit here and we could obviously talk about this all day next week we will talk just about websites. Next week's episode we'll just do websites because clearly it's an immensely important thing and this is changing all the time. And it's about AI and it's about authority and it's about all those kind of things. So we'll just do websites next week as our episode. How about that? And we'll cover it all off in one go because everyone's nodding and putting their hand up because they want to talk about it. Because the clock's been us this week. So next week, websites. Thank you very much for your time everybody.

Speaker E: Thank you.

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