Fall from Grace

I grew up working on refrigerators. I repaired my first Sub-Zero refrigerator in 1966 when I was just sixteen. Of all the brands I worked on, I was enamored most by Sub-Zero’s design. It was the embodiment of style and function, high quality and innovation, a quintessential kitchen appliance in a category of its own. I’ve watched the company grow through the years to a market leader. When I started my own refrigeration service business in 1974, the Sub-Zero company was a source of inspiration. But not any more.

Since January 2012, Sub-Zero has been putting the squeeze on the thousands of small independent service companies in the U.S. by restricting the availability of replacement parts and raising the cost of those parts by as much as 300%. It has also, as of January 2014, eliminated all trade discounts after 50 years of open support to the service industry. This has driven the cost of repairs to consumers well above normal. More recently, the company has stopped providing technical resource manuals, an essential aid for proper diagnosis of Sub-Zero products.  The entire refrigeration service industry is in an uproar.

Shipping fees, which most shipping companies normally evaluate by weight, are now based by Sub Zero on the value of the merchandise, driving up costs even more and magnifying the hardship to service organizations across the country. For example, a control board, even though it weighs a few ounces, cost more than $20 to ship from a Sub Zero distributer less than a hundred miles away. That’s about three times as much as UPS charges. It’s as if SZ has a vendetta against anyone competing with its factory service centers.  I believe that, long term, these actions will affect Sub-Zero negatively. Some of the company’s biggest advocates, such as myself, have been the owners of small independent service centers that supported SZ and promoted its products. But now everything about the company philosophy seems to have changed.

Recently, after SZ cut-off independents’ access to its service manuals, I called the engineering department for technical advice. I was instructed to carry out some diagnostic procedures, which I did and, in conclusion, was given the wrong advice. I was perplexed, and wondered if  the SZ company lost its rudder. I subsequently resolved the problem on that job, but without help from Sub-Zero.

The SZ Freezer company was established in 1945 by Westy F. Bakke in Madison, Wisconsin. Operating out of his basement, Westy Bakke built the first free-standing freezer. By the mid-fifties he had developed the first built-in refrigerator, which altered the future of kitchen design by fitting flush with surrounding cabinetry and offering a plethora of door-panel options. This spurred a swelling industry for kitchen designers. Sub-Zero was also the first company to employ dual-refrigeration technology, which allocated separate cooling systems for each refrigerated compartment. This has become standard on most high-end brands.

Under Westy Bakke’s leadership the company prospered for more than half a century. He was a pioneer, a man of great vision with only one purpose in mind–to build the world’s finest refrigerator.

I’ve never been officially associated with Sub-Zero, but on one occasion prior to 1993, which is as far back as my records go, the company’s engineering department called me to fix a problem that their own authorized service people couldn’t resolve. I solved the problem by creating a special tool to make the repair, saving SZ the cost of replacing the customer’s refrigerator. I sent them a bill and was paid promptly. I was so proud to be connected to SZ that I made a photocopy of the check and hung it on the wall of my office. I’m concerned now that the Sub-Zero Freezer company, under its current leadership, will lose its market dominance because its policy towards fair trade has been altered. I’ve seen many companies come and go during my career, including Revco, Crosley, Gibson, Philco, Norge, Kelvinator, and more. They’ve all folded or faded away.

If Sub-Zero wants to be around for the next 50 years, it should rethink its strategy towards independents, the backbone of the service industry, and the standards of fairness. Other high-end refrigerator manufacturers, especially European manufacturers, are looking to expand into the U.S. Market and are waiting and willing to attract disgruntled service organizations and frustrated customers. One such company, Liebherr of Germany, invited me in the middle of winter, February, 2014, to a training seminar in a warm climate. I was picked up at the airport in a town car, brought to a fine hotel, and fed like royalty. The company’s database and all technology were shared with me and I was educated on all its products.

Every company has to determine its direction, but a sudden, all-out drive for profit, against free trade tradition, usually dilutes a company’s image, or damages its reputation, or both. Restricting trade and choking independent service organizations is a sign of weakness, and in my opinion will only diminish the company’s position and send it on a backwards journey.

An example of how an appetite for excessive profit can sometimes lead to loss is that I have refrained from selling any Sub-Zero products this year and don’t intend to promote the SZ name any longer. Instead I have steered my customers towards other product lines with similar engineering excellence.  On June 4th of this year I delivered my first built-in GE Monogram refrigerator. It was exactly the same size as a Sub-Zero, with stainless steel doors, and was $3000.00 less than a SZ replacement. The customer was elated. Speaking for myself, I find it difficult to support or promote a company that has its hands around my throat. Companies of great stature are built on sound principles, fairness being one of them.  Free trade is the better principal and the best path to higher profits.

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