Cheater Paper: Are Distributors Selling It?
Distributors are always looking to get the upper hand over their competition. Sometimes that means resorting to extreme measures. Case in point is what some jan/san distributors are currently doing to win business — taking advantage of customers by cheating them on towel and tissue purchases.
Traditionally, distributors sell a 9-inch jumbo roll toilet tissue (JRT) that contains a standard of 1,000 linear feet of tissue. But over the years, some distributors are selling 9-inch JRTs that have been shrunk down to 800 linear feet per roll or even less. Although the roll may appear to look the same as a traditional JRT with 1,000 feet, it’s far from it.
Distributors say rolls are being fluffed and rolled looser to achieve the 9-inch diameter that end users expect. But some distributors who sell this paper, commonly referred to as “cheater paper,” don’t openly inform end users of the shorter length. The cases are marked as 9-inch JRT, so distributors bank on end users assuming that it contains the same linear feet of products.
Paper towels have also followed this same trend, but distributors say they find it more common with toilet tissue.
Distributors who sell cheater paper are swindling end users by passing it off as traditional rolls — but at significantly lower prices — as a way to win new accounts.
“Lots of distributors cheat,” says Andy Brahms, president of Armchem International Corp., Fort Lauderdale, Fla. “These are companies that are looking to keep their market share and aren’t totally open and honest with their customers. They buy cheater rolls and pretend that they are the same as the others.”
By not informing customers of the shorter lengths, distributors are acquiring business from end users who are basing their paper purchases solely on price. Unannounced to these price-shopping customers, however, is the fact that the lower price tag is actually just a disguise and that they’re not really getting a bargain. Meanwhile, honest distributors are left to pick up the pieces after their customers jump ship to buy cheap — but cheater — paper.
“It happens to us quite often,” says Charles Moody, president of Sterling, Va.-based Solutex Inc. “Sometimes customers will say they can get a lower price from another company or when we’re working on a new account they’ll say, ‘Well, we’re getting our paper for $4 less a case.’ So we’ll ask if we can see it. Most of the time we’ll see that it’s actually a shorter sheet. It can be as much as 40 percent less paper in the case.”
Moody says over the last five years the traditional 4.5-inch by 4.5-inch roll of toilet tissue that his company sells has consistently been challenged in the market by smaller rolls. In fact, his company has encountered competitors selling toilet tissue rolls that have been cut down as small as 4.5-inches by 3.5-inches. These cheater cases, when compared to the 4.5-inch by 4.5-inch, 2-ply, 96 rolls per case toilet tissue that his company sells, weigh significantly less. In fact, Moody says the cheater paper his competition is passing off as a traditional roll comes in at 16 pounds less a case.
Distributors like Moody who sell towel and tissue products say the paper sector has become extremely volatile nowadays as dishonest distributors are increasingly lowballing their competition to boost profits. As a result, honest, hard-working distributors must take the necessary steps to protect their profit margins by educating their customer base in today’s price-sensitive market.
Louie Davis Jr., senior territory manager with Central Paper Co., in Birmingham Ala., says some distributors have no choice but to sell cheater paper to remain viable. That’s because more customers nowadays are only concerned about meeting their quarterly budgets and purchasing paper at a lower cost per case is very appealing to them.
“There’s nothing wrong with selling cheater paper, but what’s wrong is it comes down to a situation of ethics,” says Davis. “If a distributor is selling intentionally to deceive a customer, that’s when you have an ethical problem. If you’re going to have a relationship with a customer, you can’t do that. What happens is, if a distributor misleads the customers, the customer will stop using them because they won’t trust them anymore.”
Distributors who are purposely misleading customers by passing off cheater paper as something it’s not, is unacceptable in today’s marketplace, says Moody.
“If you purposely are trying to mislead your customer, you are already not treating them the way you’d like to be treated as a consumer,” he says. “You’re the expert as the distributor. You shouldn’t be taking advantage of the customer’s non-expertise to make a bit more profit.”
Distributors say some of their customers are aware of today’s cheater paper phenomenon. However, a majority of end users still make purchases based on price and need to be informed by distributors that they’re not getting the exact product that they’re paying for.
“Most customers don’t know they’re getting cheated,” says Brahms. “They don’t know to measure the paper or they don’t weigh it. They don’t know how much six rolls of a flat roll sheet of 800 feet is supposed to weigh. They just know that there is six rolls, I’m paying $30 now vs. paying $45 before.”
Distributors must educate customers on what they are already spending their shoestring budgets on.
Education Equals Protection
Cheater paper can be very difficult to discover if distributors are not educated on the tricks of the trade. Letting it infiltrate the market can be devastating for a distributor’s profits.
By educating customers on the risks of purchasing cheater paper, distributors can protect their margins and stave off dishonest competitors who are out to undercut their pricing.
Hank Josephs, president of Rahway, N.J.-based Spruce Industries Inc., says facility managers are aware that cheater paper has made its way into the market, but they are not in charge of making facility purchases. Rather, distributors must educate purchasing agents, but this can be difficult because they are more concerned on balancing the budget than learning about toilet tissue, says Josephs.
“The buyers, the purchasing agents, they don’t know that they are being cheated because they just look at a price,” he adds.
Brahms says that most end users will assume that just because a product says it is a 9-inch jumbo roll that it contains 1,000 linear feet of tissue. However, he cautions that just because a case of tissue or towels is $4 cheaper a case, it doesn’t necessarily mean it’s a good deal. In fact, Brahms points to the fact that if the roll is 25 percent less footage and 25 percent less basis weight at a 15 percent savings over a traditional case, a customer is actually paying 35 percent more for the product. In addition, it will take approximately 50 percent more of the substandard product to equal the same amount of a traditional roll.
“Another way we tell customers to look at it is, if there’s 500 missing inches per roll, times that by 96 rolls in a case,” says Moody. “It’s almost a mile less of toilet tissue in the case.”
Distributors say a big key in notifying customers about the dangers of buying cheater paper is that unknowingly purchasing less paper drives up a facility’s labor costs.
“If a customer is getting a 600 foot roll of 9-inch jumbo roll tissue instead of a 1,000 foot, look at what that does to his labor cost,” says Davis. “He’s going to have to change the roll out almost two to one. At least 80 percent more often he’s going to be changing those rolls out. And if you’re buying a lot of tissue, then that’s a lot more labor.”
Distributors say when customers find out that they are getting less paper, they feel cheated. And as a result, word spreads that hurts the seller’s reputation.
“It really puts a sour taste in a customer’s mouth when a distributor sells them something that was tricking them,” says Moody.
There are certain characteristics to look for to recognize a cheater paper, distributors say. Often the diameter of cheater paper appears to be the same size. However, look closer at the product and there are areas where the paper differs.
With cheater paper, the best lesson an honest distributor can give a customer comes in the form of comparing their product vs. a competitor’s product in front of them. An ethical distributor will not hesitate to demonstrate the quality of their product.
“Weigh the paper,” says Davis. “Compare a roll of yours to a roll of theirs. Put a roll of yours and a roll of theirs in a customer’s hand. Put it on a scale in front of the customer and let them see the difference.”
Brahms educates customers of another subtle trick. If the case of paper does not list the specifics about the product such as the amount of rolls, the amount of feet, the weight, and the amount of sheets, it’s a sign that the paper at question isn’t what it appears to be.
“If those things are not on the case and it’s not listed on the invoice, then you know that they’re cheating you,” Brahms tells end users.
Fine Tune Your Sales Reps
Besides educating customers on the perils of cheater paper, distributors say education is a must for sales reps in the industry. Distributors must educate their sales force — especially new sales reps — that this is occurring so that they don’t get outbid and lose valuable business.
Vince Sortino, vice president of sales at Warminster, Pa.-based Philip Rosenau Co., says his company has been outbid by distributors who sell cheater paper. As the recession crippled end users’ budgets, it became more evident. So as a way to protect its profits and stay competitive, the company communicates to its sales reps on what to look out for when customers say they can get a better price on paper products from a competitor.
“If you give a customer pricing and you come in 10 or 15 percent higher and you gave a competitive price, there’s something that’s not quite right about that,” says Sortino. “That should raise a red flag to go dig a little further.”
Often, distributors say sales reps will fall into the trap of taking a customer’s word for what they’re purchasing. With today’s cheating phenomenon taking place, Davis says distributors should never take a customer’s word on what they’re buying. Due diligence is a must, especially when bids from competitors in the same market are significantly lower.
“Don’t take anybody’s word in what they’re buying,” says Davis. “Even if it says on the invoice that as being true. You have to physically go and check the metric of the product.”
As the economy struggles to recover from the recent recession, end users are still attracted to lower-priced products and paper falls into that category. However, if distributors can help customers recognize that the low-cost is often a disguise and that what they are purchasing is hurting them in the long run, it helps cement a long-lasting relationship that is built around honesty. After all, relationships are built on trust, not cheating.
Disclaimer: Please note that Facebook comments are posted through Facebook and cannot be approved, edited or declined by CleanLink.com. The opinions expressed in Facebook comments do not necessarily reflect those of CleanLink.com or its staff. To find out more about Facebook commenting please read the Conversation Guidelines.