The World of Lighting

Lately the lighting world has been in the news. Some recent articles of note:

• TCP has announced that it is going to offer its own branded line of CFLs, putting them in direcvt competition with the Big 3 for CFLs (whom are also TCP customers) as well as the retailers for whom they private label. From a distribution viewpoint, this is a non-issue as TCP already sells its brand to distributors and in lighting showrooms but could be interesting to see if current customers seek alternative sources.
• An article in Monday’s Wall Street Journal on GE’s lighting and appliance division highlighted that GE is making next generation product investments in its lighting group, regardless of whom the long-term owner is. This is good for GE distributors who have questioned if the company was in the lighting business for the long run.
• Sylvania has finally captured a big one. According to multiple sources, Rexel has committed to being single source with Sylvania, providing Sylvania a national chain relationship. GE and Philips are losing shelf positioning at Rexel but seeking to retain share in the field with some willingness to match pricing that Rexel/Sylvania are offering. We can suppose that neither GE nor Philips will want to lose business where they have an SPA or a contract, hence must be looking to partner with their other distributors in those marketplaces where Rexel led with GE or Philips.
• LEDs are a growing, and confusing, marketplace. Lots of new products continuously coming out from many new manufacturers. And new distribution channels, in many cases, are taking the lead. A recent article in Purchasing magazine highlighted an electronics distributor (Future Electronics) who is doing $300M in solid-state / LED lighting and another that looks at this market as a growth industry. While much of this is at the component level, components are only needed if there are finished products. LEDs are being used in unique ways – we recently met with a company that is developing LED lighting for the cargo beds of pick-up trucks – for the new truck and after-market segment).

Many of the challenges that are facing the LED market were recently discussed at a roundtable held at EDN’s Designing with LEDs Seminar. OSRAM, Cree and Philips Lumileds were represented. Essentially the say

• LEDs need to be designed for specific applications
• a screw in LED is “not a replacement for the incandescent bulb” and
• components matter.

Bottom line … before you recommend LEDs or an LED manufacturer, make sure you are either

1. responding to specs
2. have the inhouse expertise to understand this market or
3. vett your suppliers extremely well.

As a distributor, your name is on the sale and you make no money from returns, warranty claims or after-sale customer service. Just like customers need to consider “caveat emptor” (buyer beware), you need to be concerned with “caveat venditor” (seller beware), especially if you let your salespeople or branch managers making purchasing / manufacturer decisions.

What are you seeing in regards to LEDs and are you seeing any marketplace
reaction to Sylvania and Rexel joining forces?