Contributor Since 2011
The results are in and not surprisingly, the industry is unhappy with the Cree (CREE) acquisition of Ruud Lighting and BetaLED. Over the past few weeks, we spoke to several key companies and one thing is clear, most will not share reps with this new competitor.
In our industry the reps are key to gaining sales especially with new technology. Reps work in their local market and ensure that certain product features are specified in an effort to lock in their products. A strong spec, with unique features, allows reps to control jobs, earn commissions, and ensure that friendly distributors win those jobs.
We talked with leadership at Acuity Brands Lighting (AYI). While they insist there is no mandate forbidding Acuity Brands Reps from carrying the Cree/BetaLED line, they made it clear that Acuity Brands will run their business as they see fit and work with reps who best integrate into their strategy. Your humble editor will be very surprised if any Acuity Brands reps carry the Cree/BetaLED line. A non-Acuity Brands source explained that Acuity Brands was unhappy at LIGHTFAIR when Cree launched their series of LED Troffers--a direct competitor to the successful Acuity Brands RTLED.
Juno has an even more aggressive stance. Tim Rooney, Juno's VP of Sales, sent an email to Juno reps, stating that they view "Ruud Lighting as a significant competitor… and are not interested in sharing a line card with them."
Philips Day-Brite (PHG) also views Cree/BetaLED as a competitor. A letter from Bob Carswell, VP of Sales, states, "Cree started as a component manufacturer and supplier that has evolved into a luminaire manufacturer, and with their recent acquisitions has become a key competitor." He goes on to say, "I will be following the continuing development of this new competitor and how it affects us. Please notice the use of the word 'competitor' which is what Cree is now." Carswell makes no specific mention about sharing reps, but his emphasis on the word competitor makes it unlikely they want their reps to carry Cree/BetaLED. He does state that the Cree acquisition further strengthens the position and viability of LED technology.
In a letter to LSI (LYTS) agents, Shawn Toney, Senior VP, Commercial & Industrial Lighting Group, wrote, "Cree has begun to aggressively pursue a new position in the market place risking its current agent and OEM relationships and creating a new round of line card uncertainty." Further, he states, "....it is not our strategic intent to participate in an agency model that includes the newly formed Cree/Ruud/BetaLED organization."
One thing is for certain. The Cree acquisition of BetaLED has created much uncertainty.