Unlock janitorial sales
Janitorial supply industry adopts pragmatic attitude toward newcomers
By Susan L Srikonda -- Industrial Distribution, 10/1/1998
Every job shop or assembly plant that an industrial distributor sells to has floors and machinery that need to be cleaned and employees whose hands are covered with grime. So carrying janitorial products may be a natural progression for industrial distributors, but the product category requires its own cache of product knowledge -- particularly with chemical products -- and an awareness of the different logistical challenges it presents.Kline & Co., Inc., an industry research firm based in Fairfield, N.J., will release the results from a survey of 1,000 janitorial supply end-users prior to the International Sanitary Supply Assn. convention in October. The survey studies trends in janitorial supply distribution, including analyzing which distribution channels janitorial end-users are turning to.
"I don't have hard numbers yet, but clearly industrial distributors do play a significant role in selling to factories," says Bruce Boynic, senior associate at Kline. "For the industrial market, the leading distribution channel is still [janitorial/sanitary] and paper houses, followed by the industrial distributors. You also have direct sell from manufacturers and, in the case of smaller end-user companies, warehouse clubs."
Many of the industrial distributors adding janitorial products to their line, like T&A Industrial Distributors in Brookfield, Wisc., are doing so at the request of customers who want to deal with fewer vendors. The janitorial supplies T&A Industrial stocks are limited and account for a small percentage of the company's business.
"There are people who know us and would like to buy more stuff from us, and they influence our decision to sell janitorial," says T&A president Jim Ketter. "We look at what value we can add to our relationship and transaction with a customer. Our trucks are at a lot of these plants every day dropping things off, so does it make sense to add a case of soap or toilet tissue? Yes. We don't want our salesmen to emphasize it, to go out and sell toilet paper all day because that's not what we do. But I bundle it with other goods if it makes sense for the customer."
Ketter cautions that distributors should take into consideration the logistical concerns unique to janitorial products before adding the products to their lines. Warehouse space, for example, is a concern because many janitorial products are heavy and bulky and require plentiful storage space as well as appropriate loading docks and material handling equipment. Some janitorial inventory turns up to 10 times per year. On the other hand, Ketter points out, the usage rate is very predictable.
Chemicals in balance
Generally speaking, the margins on commodity items like toilet paper and standard equipment like mops and brooms are low. What happens when industrial distributors decide to dip into chemical products like floor cleaners or degreasers that typically have higher profit margins?
There is a significant difference between someone who is handling a janitorial product and has real expertise in the area and someone who is handling it from a logistical standpoint, says janitorial distributor Jay Vonachen, president of Vonachen Service & Supply of Peoria, Ill.
Like all specialists, janitorial distributors approach their customers from a perspective of having knowledge to offer. Their job is to know, for example, which manufacturers' floor sealers, floor finishes and floor cleaners are compatible and which aren't. Otherwise the floor finish may not stick to the sealer and the cleaner may remove the floor finish instead of cleaning it.
"Our job is to know how those products interact and, like other distributors, we're going to go where the product is used and try to understand the circumstances under which it is used and specifically what their requirements are," says Vonachen. "We'll also do in-service training to make sure the people using the product are using it correctly." An expert in the field will also be able to save the customer money by recommending products that will help minimize the expensive labor costs involved in some janitorial applications.
Both Vonachen and Grant Watkinson, president of ISSA's board of directors and president of Coastwide Laboratories, admit that industrial distributors can sell chemical janitorial supplies successfully and knowledgeably if they invest time and resources in training.
"I think what they need to do is to understand what they're getting into and understand the regulations and reporting requirements involved," says Watkinson. "Distributors in industries like plumbing or electrical are already in the business of selling some chemicals, though they may not be cleaning chemicals, ... and if they're of any size they need to be in compliance on those chemicals, so it's just a matter of expanding that. It's just a host of stuff that might be a bit more regulated or different than what they're used to selling, but very do-able."
Manufacturers like Big D Industries, Inc., of Oklahoma City, Okla., which manufacturers odor control chemicals, dispensers and systems, maintain that certain janitorial products require new distributors to undergo product-specific training.
"Just making the sale is not sufficient ... because so many of the products in janitorial require training on how to use them and where to use them," says Don Lees, president of Big D. "If they're getting into the business, they have to understand the interaction of the chemicals involved. All the chemicals involved are not toxic by themselves, but in combinations they can be. If you don't know what you're doing with them, you can ruin a floor or carpet."
The same members of the janitorial supply industry who readily admit that industrial suppliers, with the appropriate training, can effectively sell janitorial supplies also maintain that the increased competition is not an immediate cause for alarm among traditional janitorial suppliers.
There are several reasons for this nonchalance, one of which is that some traditional janitorial houses will retain a place in the channel as second-tier suppliers to general-line and integrated suppliers.
"I think the concern of the traditional jan/san houses is that profits would flatten out if people get into the business just for logistical reasons," says Lees. "But if people get into the business and learn the business and apply it properly, then there won't be an erosion of profits. In my opinion, the training in how to work with the products is probably more labor intensive than it is in many industries. You don't want to see people get into it untrained."
Another reason for the pragmatic attitude toward new competition is that traditional janitorial houses, like Vonachen Service & Supply, are likewise expanding the scope of their product offerings.
"I think of myself as being a distributor first," says Vonachen. "As you get into a particular commodity or specialty, you can go so far until you get to the point where there is some special expertise involved. We handle safety supplies, but we reach a certain point where we don't have the same expertise as someone for whom that is their principle business. But we do handle some safety supplies as an accommodation to a customer and because we're trying to be more important to their business. And my friend in the safety supply business is doing the same thing, for the same reasons."
And finally, in janitorial supply as with any other distribution business, there will continue to be customers who need the application expertise that only a specialist can provide.
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