‘Our key market is independent retail and that’s where our future is’
After a difficult few years, the UK arm of Liebherr is back in the game and has a major new range of freestanding premium cooling – BluPerformance – out this month. Sean Hannam spoke to Tim Hutchinson, divisional manager of Liebherr-Great Britain
Liebherr has had a tough time of it. When the recession hit in 2008, the German refrigeration and freezer brand’s UK business suffered due to a lack of investment from the owners of its distributor Coolectric.
Then, in January 2014, Coolectric’s distribution centre in Newport Pagnell, Buckinghamshire, was destroyed by fire.
A year later, after the closure of Coolectric, the Liebherr UK operation was taken over by Liebherr-Great Britain, which had a sales and servicing headquarters for the company’s heavy machinery division, based in Biggleswade, in Bedfordshire.
The first six months since the merger were challenging, according to Tim Hutchinson, divisional manager of Liebherr-Great Britain, but now things have taken a turn for the better.
Q: It’s been just over a year since Liebherr-Great Britain took over responsibility for the Liebherr refrigeration and freezer business in the UK. Prior to that, the products had only been available in the UK through distribution. How has the past year been for Liebherr?
Tim Hutchinson: We’ve had a full 12 months – half of that was a very difficult time to be honest with you.
The background to why Liebherr decided to take the brand direct in the UK was because its performance in recent years wasn’t to the satisfaction of the Liebherr family [which owns the brand].
I worked very closely with Liebherr when I was one of the directors of Waterline [the distributor which acquired Coolectric, the importer of Liebherr appliances in 2005]. I was part of the team responsible for the acquisition of Coolectric – I left in 2008.
From 2005 to 2008, we doubled the size of the business, but then the recession hit. Waterline wasn’t particularly well equipped for the recession and, as a consequence, it ended up changing hands – it was bought out by one of its biggest suppliers, Crown Imperial furniture.
Investment in Coolectric and the Liebherr brand ceased and then the final key event was the fire.
The supply of goods to the marketplace was massively disrupted and that triggered off a chain of events within Coolectric that effectively led to a decision being made by the Liebherr family to take control of their brand in the UK through Liebherr-Great Britain.
Liebherr-Great Britain has been established for many years on its site in Biggleswade – it has strong roots in the UK, albeit as a sales and service organisation for heavy machinery.
The entire infrastructure was in place, so notice was given to the owners of Coolectric in September/October 2014, with the intention of having a six-month handover. That didn’t happen and Liebherr-Great Britain ended up preparing the business in six weeks rather than six months. Coolectric was closed at the end of December 2014 and the Coolectric staff were moved to Liebherr Great-Britain – 16 staff found a new home in Biggleswade. The downside was that our original intention of having six months to plan the business had to be accelerated.
The first six months were very challenging – we didn’t deliver any goods until March 2015. The consequence of that was that we lost display space with our key electrical retail partners. Due to that lack of supply, people lost a little bit of confidence in Liebherr. We started to recover our position after the CIH [Euronics] show [in April 2015] – CIH members are a key customer base and we started to rebuild the business from that point onwards.
Q: What’s the main advantage of Liebherr being its own entity in the UK, rather than going through a distributor?
TH: The key benefit it gives us is the support from the entire Liebherr organisation – effectively Liebherr-Great Britain will become a smaller version of Liebherr Germany and Liebherr Austria.
Liebherr in Germany is a very different machine from what you’d expect Liebherr to be in the UK. For the past 20 years, Liebherr in the UK has been a small player in a very niche market. Liebherr in Germany is a very dominant part of the marketplace.
Q: So is the aim for Liebherr to become less of a niche player in the UK market and more of a mainstream brand?
TH: In the past, Liebherr has succeeded with higher-priced products with USPs – wine cabinets and side-by-side. Where we need to grow as a business is that we need to increase our recognition and our penetration in other markets – certainly at lower price points. We’ve got the biggest range of tabletop [refrigeration] in the market, but, admittedly, it’s not at Beko’s price level. Tabletop is a key part of the marketplace for volume and that’s where we have a really great strength. We need to extend our success away from the unique niche models that we’ve got and spread it across a further 250 SKUs that we have available.
Q: Your new range of refrigeration products, BluPerformance, was previewed at IFA in Berlin last year and is available in the UK this month. What can you tell us about that?
TH: The timing is perfect for us – it’s going to give us a really positive story to try and get Liebherr back on the radar for the electrical trade.
There are three core technology benefits –increased capacity, energy efficiency – we’ve moved our technology to a couple of years ahead of the marketplace and we’re now offering A+++/-20 per cent – and low noise.
We’re also launching our SmartDevice later this year – it’s a wi-fi connection from the machine directly to our factory. That will give us a huge benefit from a service perspective – diagnostics are key – and it will give the consumer some level of interactivity with the machine.
The consumer can control temperatures, you will be notified by an alarm if the door’s left open and it will send you a reminder when the charcoal filter needs replacing. It will work with a smartphone.
Q: What’s your take on the current UK white-goods market?
TH: Polarisation has been a massive symptom since 2005/6 – that’s when the mid-market started to disappear, particularly with cooking brands. The mid-market arena is very challenging – there are a number of big players that are selling products at frighteningly low price points.
We [Liebherr] need to focus on traditional bricks-and-mortar retailers – Liebherr needs to be sold. Our first challenge is a lack of consumer awareness.
Our product needs to be touched and felt and the guys selling it need to have a good level of understanding to justify the potential price point difference between us and brands like Beko. Our key market is independent retail and that’s where our future is.
Q: So, after some tough times, you’re positive about what lies ahead for Liebherr
TH: Absolutely. Last year was very tough – I’ve got a few more grey hairs – but we’re really excited about BluPerformance and it will help to get Liebherr back on the map.
- Liebherr will be at this year’s Euronics show at the NEC, Birmingham, from April 17-18