Confluence and its retailer network look for light at the end of a long tunnel

Late deliveries, poor communication, boats that arrive that aren't what was ordered, invoices for products not received, and blems galore are a few of the troubles that have continued to haunt Confluence since its acquisition of Watermark and subsequent consolidation of factories and warehouse in Easley, S.C. But things may be turning around in Easley if what SNEWS® is hearing is true, and not a moment too soon for quite a few retailers who've remained loyal to Confluence through it all.
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Late deliveries, poor communication, boats that arrive that aren't what was ordered, invoices for products not received, and blems galore are a few of the troubles that have continued to haunt Confluence since its acquisition of Watermark and subsequent consolidation of factories and warehouse in Easley, S.C. But things may be turning around in Easley if what SNEWS® is hearing is true, and not a moment too soon for quite a few retailers who've remained loyal to Confluence through it all.

SNEWS® began hearing tales of delivery disasters and blem problems at Confluence as early as March. However, in June, we began to receive emails and calls from retailers taking us to task for not investigating the company's challenges. One retailer suggested the situation was a "disaster of communication and delivery" that he'd never before experienced and wondered "why we weren't doing our job." However, emails and calls from the retail sector pointing fingers at Confluence AND Watermark had become so common, we decided it was time to find some balance to what some told us was a very one-sided issue. So we set about interviewing large and small Confluence specialty dealers around the country by phone and email to ferret out what was real and what was, perhaps, a situation limited only to a select number of retail operations.

First, the bad news
What we discovered through all our investigation is that while very few retailers want to kick Confluence to the curb, most do still have issues with the company they hope and trust will be resolved soon. There is no ducking the fact that deliveries have been absolutely horrendous for all but a few. Retailers reported receiving boat deliveries full of miss-shipments, with boats arriving in the wrong color, or without rudders when rudders were expected, or even the wrong models of boat entirely. Trucks have been arriving loaded in no organized fashion, with boats for the first delivery packed in the back of the trailer, meaning the entire trailer has to be off-loaded adding to the confusion. Blems continue to be a consistent problem. And communication? Fuggetaboutit, we are told, for anyone trying to call the company. Emails do get answered. Sometimes calls to cell phones. Rarely, if ever, do calls to the company voice mail get much attention it seems.

In their words
Retailers across the country universally insisted on anonymity when providing us with information. We sifted through mounds of notes to offer up a few of the comments that best summarize the general responses, representative of large and small Confluence dealers in all parts of the country:

>> We are told that the reason we can't get the boats we have ordered is the company is moving warehouses. Right now, we are at eight to 10 weeks before we will see a delivery.

>> The boats sell, simply put. Delivery makes no sense. One boat one day, three in a week, etc. Delivery is a nightmare and the consumer doesn't understand and we as retailers feel weak not being able to get a firm delivery time in order to keep customers happy. For next season, I would hope delivery is immensely improved.

>> Blems? Who cares as long as we satisfy the customer who wants a boat NOW and can't wait for the firsts. Even the first quality boats have been somewhat disappointing (one came in with no drain plug hole or plug), another scattered screws when we flipped it, on and on.

>> The Tsunami series and the Tarpons are winners in design and creature comforts. The most comfy rec seat in the world doesn't hurt! Consumers think the boats are great and we just smile when they ask about ordering specific colors that we don't have. The boats sell well and I will continue to support Confluence.

>> What was an excellent vendor and one of our largest in the spring has gone from being a proactive partner to almost totally incommunicado. It is nearly impossible to get them on the phone as they have implemented a dead-end phone labyrinth to block any perception of customer "service." We have the special treat of getting a new CSR every few months along with zero info on who he or she is. We call and are told that only "our" rep can help, but never get a call back.

>> Overall, I'd say we'll take a much harder look at independents who have been there for us like Liquid Logic. Frankly, for the same reason we encourage our customers to shop with real specialists, we should be shopping with the real specialists in our industry… so, this year, even if it means pruning back business, I'm going to advocate to my staff that we return to our roots so to speak and get back with the Steve Jordans of this business. Damn the holding companies and corporate a-holes.

>> Our inside customer service reps are somewhat difficult to get hold of and their limitations do not make up for the lack of outside reps. For example, the only way that I can contact the inside guy is via email. I don't bother anymore with leaving a voicemail because the fellow will NOT call me back. However, he does respond to emails and I have actually accomplished things in this manner, to his credit.

>> I will say that thus far, the manufacturer has followed through on correcting (an increase in warranty issues) by replacing the boats, but who would want or has time to go through the arduous process. This process involves contacting the in-house people upon which they tell you to make an attempt to repair the boat. We are always unable to repair and have to contact them again. On this second round, they request pictures. A couple of weeks pass and they ask for the serial number to be cut out and sent to the warranty desk. At the same time, they ship the replacement. All of this takes about six to eight weeks and, in the meantime, the customer's got nothing to paddle. To add insult to injury, they invoice us for the replacement and drag their feet on the corresponding credit. I still have an outstanding invoice from a March boat warranty. Poor quality ultimately makes everyone unhappy.

>> Are we experiencing anything much different this year than in other years from our boat vendors, specifically Confluence? No, not really. Does this mean that everything is as it should be with Confluence? Well, no, not really, but not as bad as it has been before.
We have had some blems, but not enough to be alarmed that the business is out of control.

>> I believe they are trying to make things work as best they can. I know they have not been delivering very well...apparently we have been treated pretty well compared to some other folks. It's easy to kick Confluence, but I've inherited dysfunctional businesses before so I know the challenges. It takes a long time to move the mistakes through the pipeline, so even after they fix things, there are still going to be issues. I think their biggest problem is that they have poor internal communication....sales promises boats that manufacturing can't deliver, not out of maliciousness but out of simple miscues and poor communication. They know this and I believe they're trying to fix it.

>> To those complaining about Confluence, I usually say, "Vote with your dollars and don't buy them." Some folks have done that, of course, but others just like to complain because it's a day ending in Y. It isn't like there's no other place to find boats.

>> I am not going to throw them under a bus, because we have been partners for a long time. They have some issues they may never come out of. Word on the street is people are finally considering changing brands. Everything is a cycle, baby! Liquid Logic finally has a boat that works and works well. Andy Zimmerman is going to knock the socks off some folks at OR. We will see what happens. Fear is the best motivator of all.

>> Well, pretty much every shipment they’ve sent this year has been packed miserably with no order to the boats in the truck. The ones who know what they're doing make certain boats (or any other product) are loaded in reverse order of their deliveries, making it a snap on the receiving end to unload product. It's a little thing, but good business is built on little things and they've been missing that.

>> Blems? Whoo boy, do those lads know how to build blems! Want a first quality boat? It'll take weeks. Blems? Line up and take as many as you want. And you know, the blems we've seen all look pretty much first quality to us. A few have obvious blems, but if they were not stamped as seconds, we could probably sell them as first quality. It reminds me of an old story I heard years ago about a fishing lure company and their blems. They'd have them all the time. A buyer finally visited the plant only to find they were making lures as they normally would and just calling them seconds. They'd figured their margins out and could sell a standard lure as a "blem" and still make money.
Having said all that, I'll take blems any day. We can offer a lower price and in so doing immediately take price off the table for the customer (who all too often tries to beat us up for a better price; with blems it doesn't happen). And we can maintain a margin equal to or, key point, HIGHER than normal. So is this a bad deal? Not to me, it isn’t. I will take as many blem boats as I can -- they've made money for me.

The good news
We spoke with Kelley Woolsey, executive vice president of marketing and sales for Confluence, who told us, "We are starting to get back on track with dealers now and for the most part our dealers have been incredible.

"Our retailers are certainly concerned and disappointed," said Woolsey, acknowledging the company has been having its share of delivery and other problems it has been working hard to overcome. "But they have not thrown us under the bus with the consumer and have offered to help us work through the problems. And it is that loyalty that has been, from our standpoint, rewarding and reassuring."

Confluence has been hosting retailers over the last few months at its Easley facility, and we spoke with a number of them following their meetings, and each came away impressed.

One retailer told us that what he was most impressed with was the company's new hire, Dean Youngblood, vice president of operations.

"He walked into the room and told us straight up that 'I don't know anything about making kayaks, but I do know how to make things perfectly, without mistakes, and do that consistently,'" the retailer said.

Youngblood just started with Confluence, and comes with a manufacturing engineering background from Audi and BMW. We are told he saw the Confluence job in Easley as a way to get back to the states from Europe.

Woolsey told us the company has invested heavily in a new racking system for the warehouse, and that the company has just installed an RF inventorying system so it will know exactly what is where and when.

The company has also begun working very hard to educate its employees and ensure there is a solid retention program in place. More experienced employees will, Woolsey knows, mean more educated employees, meaning less likelihood of manufacturing mistakes from human error.

Youngblood too has started making his stamp, by rebuilding every machine in the manufacturing facility to ensure that everything in the manufacturing process is understandable, manageable and can be replicated, and, most importantly, does not simply depend on the learned knowledge of one or two human beings.

SNEWS® View: While it has no doubt been a rough road for Confluence since it moved to Easley, it does appear that there is light at the end of the tunnel for both it and its loyal retailers, and that light is not from an oncoming train. No doubt that its challenges have made some of its competitors a bit gleeful, and we do know of one or two who are using Confluence's challenges as an excuse to bad-mouth the company. That's poor form in any circumstance and should not be tolerated by retailers.

Still holding the ship together is one Kelley Woolsey who deserves a medal for his role in keeping some semblance of sanity in what has, at times, been a somewhat insane situation -- often as a result of the parent company's somewhat unstable behavior. We would hope that ACS will take a page from Warren Buffett and become focused more on business results rather than market prices. It would behoove ACS to also realize, again from Buffett, that, "You never want to marry someone to change them."

We trust that Confluence will soon figure out a way to actually return phone calls, become proactive about working with its network of retailers on a consistent basis -- large or small -- and, with the addition of Youngblood, define best practices in manufacturing by virtually eliminating blems and delivering products on time, all the time. Retailers deserve nothing less because, as one so sagely noted, there are many good choices out there now, and the best way to inspire change in corporate behavior is, frankly, to vote with buying dollars.

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