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Diamond Needs 21st-Century Business Model, Anonymous Source Says

An anonymous source, who wished to remain unnamed for fear of reprisal, told glassBYTEs.comô/AGRR magazine that he thinks Diamond Glass' business model is what caused the company to reach the point of filing for Chapter 11.

"The [Diamond] business model came from 1980s and 1990s," he says. "The model's based upon doing the work cheaper than anyone else, paying your people a little more, stealing your employees from other companies and paying them a little bit more and selling your products for a lot less."

He adds that what he sees as today's business model might have helped the company to fare better in recent years.

"The 21st-century business model includes a benefits package, a proficient employee base, a solid niche of attractive retail stores and mobile units," he says. "It's based on earning the customer's business-not by buying it."

He notes, though, that even if the company's buyer has an improved business model in its plans, the right people are still needed to make the model work.

"Getting people to believe in a believe in [a new model] is totally different," he says.

And what if Belron were to make a bid—and win the purchase of the company? (CLICK HERE for related story.) This particular representative questions whether this is even a possibility.

"I don't know why Belron would want it," he says. "[Belron] has beaten [Diamond] where it counts."

Another industry representative, who also spoke on the condition of anonymity, questioned the competition that would be left were such a transaction to take place.

"If you believe competition is good, you wouldn't like this move," he says. "This is really something that would challenge the industry."

He also noted that it would have just as much of an effect on insurance carriers as it would retailers.

"At the end of the day, they're trying to deprive the marketplace of competition," he adds.

What do you think about the Diamond bankruptcy and the potential purchase of the company by Belron? Please e-mail glassBYTEs.comô/AGRR magazine at pstacey@glass.com.

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