Gingrich keynotes ASMMA/I.D.A. Spring Convention
I.D.A. president Sam Mitchell: distributors need to be a "conduit of knowledge."
By Industrial Distribution Staff
-- Industrial Distribution, 6/1/1999
San Francisco, Calif.--Technology, the future of the small distributor, and consolidation were the hot topics at the Spring Meeting of the American Supply & Machinery Manufacturer's Assn., and the Industrial Distribution Assn. The convention drew 2,887 delegates, seven percent fewer than last year.
There was a bit of Hollywood glamour in the air at the opening session as ASMMA president Jim Falduto of Wilton Corp. and I.D.A. president Sam Mitchell of Blackstone took to the stage clad in tuxedos to preside over the opening session which included the presentation of five Lifetime Achievement Awards. Honored were Paul Johnson, retired president of the Dake Corp.; Turner Warmack of Ziegler Tools; Richard F. McGrath, retired vice president of 3M Corp.; and industry consultants Tim Underhill and Frank Lynn.
The final "Oscar" presented at the ceremony was Industrial Distribution's Distributor of the Year Award. Jack Keough, associate publisher/editor of ID, presented the award to Scott Parrish of Parrish-Keith-Simmons, Inc. in Nashville, Tenn.
In his speech, Falduto talked about the importance of adding value for the end user, noting the myriad challenges facing the industrial distribution channel today -- things like mergers and acquisitions, the growing popularity of the Internet, and competition from large retailers such as Home Depot. He noted that distributors and manufacturers should respond to these challenges by sending a "value added" message to end users.
"Manufacturers and distributors do add value for the end user," said Falduto, adding that "it differentiates us from some of the others who want to share our business. The time has come for us to promote ... what we do for the supply chain."
Falduto introduced ASMMA/I.D.A.'s new "Value Added Partner" program. The grass-roots effort is part of the associations' year-long goal of promoting the value that manufacturers and distributors provide end users. The VAP program, according to Falduto, is aimed at spreading the word about value-added services to everyone in the supply chain. As part of the program, ASMMA and I.D.A. have developed a logo, promotional brochure and video presentation that can be used to send a value-added message to end users.
"I think you'll agree that this is a cohesive and powerful message," Falduto told members, adding later that "with the dedication of our associations, this industry is moving forward."
Mitchell, as I.D.A. president, had the responsibility of unveiling to members the new direction I.D.A. has set for itself as the century comes to a close. This new course, said Mitchell, reflects the changes taking place in society and in the industry. "As we move from an industrial age to an age of knowledge," he explained, "companies and individuals must realize that the focus is no longer solely on product, but on providing valuable information and expertise to customers.
"Our goal is to help this channel innovate," he said. "As we move into the knowledge age, we need to improve our skills to be the conduit of knowledge."
In his keynote address, former Speaker of the House Newt Gingrich offered a model for coping with the changes facing the nation at the close of the century.
Gingrich said the primary challenge for today's leaders is to "listen, because the world is changing so fast .... In fact, when you go home, I suggest that you listen to your employees before telling them about the convention. If people know that you will listen to them, learn from them and help them, they will ask you to lead," he said.
Small distributors were out in force, as evidenced by the Small Distributor Breakfast-Lunch forum. Geared towards distributors with sales of less than $5 million, the Forum consisted of networking opportunities, a seminar on profitability and a "crossfire" panel discussion on manufacturer-distributor relationships.
The spirited panel discussion was the highlight of the event, with manufacturers and distributors debating topics such as the viability of small distributors in the channel, the threat of their being "disintermediated" by the Internet, and what happens when manufacturers choose to do business with large integrated suppliers.
The 1999 American Eagle Awards were also announced. Charleston, S.C.-based Cameron & Barkley Co. won the outstanding distributor award for putting its continuous improvement philosophy into action.
American Saw & Manufacturing Co. received the overall excellence award for manufacturers. The firm encourages employee leadership and internal development.
The winner of the ASMMA Committee on Free Enterprise's individual award for supporting free enterprise was Ken Jackson, president of Dudley C. Jackson, Inc. of Helena, Ala. The firm, which celebrates its 50th anniversary this year, strives to treat its employees as customers.
Manufacturers recognized in the outstanding programs category include Hannibal Carbide Tool, Inc. of Hannibal, Mo. for a prayer and Bible study program; CooperTools of Raleigh, N.C. for work on government policy issues; De-Sta-Co Industries of Birmingham, Minn. and Elk River, Inc. of Cullman, Ala. for community involvement; 3M Industrial Markets of St. Paul, Minn. for educational initiatives; and American Tool Companies of Vernon, Ill. for environmental efforts.
Distributor winners included General Industrial Tool & Supply of North Hollywood, Calif. and Dudley C. Jackson Inc., Quality Mill Supply Co., Inc. of Columbus, Ind. for environmental work; and Interplex Co. of Lake Villa, Ill. for education.
What the attendees think
At the ASMMA/I.D.A. Convention, ID editors asked various attendees what they see as the biggest challenges facing the industry at the close of the century. Here are a few selected responses.
"I think the most significant challenge facing companies in the next millennium will be to provide value-added goods and services to the end user in a formalized program, utilizing automation and technology to drive down future acquisition and life cycle costs ... and at the same time provide the technical expertise and serviceability necessary to allow major companies to outsource many purchasing, materials management and inventory control responsibilities."
Kevin Rosenthal
Director of Sales and Marketing
A&M Industrial Supply
"How to live on shrinking margins is what I think the biggest challenge is. Competitive forces have forced us to take business at lower prices, but often times the services expected are no different and this forces us to focus our attention on improved efficiency.
"One way we're looking to do that is document all our procedures and train people to make sure we're doing things consistently and efficiently. Managing our two largest assets -- inventory and receivables -- is something we have to bring to everyone's attention. Everyone in the organization must understand what their role is in managing those assets, and how the decisions they make affect managing those assets."
John Bragg
President
N.H. Bragg & Sons
"I think one of the biggest things facing our company is integrated supply and how it's going to affect small, specialized distributors like mine. We feel that we have a niche market. We're a very technically oriented company and we're very service oriented. We think there's a place for that, but we see large customers looking to integrated supply and I'm really concerned about where that's going to go in the next five years."
Donald Kline
President
Kline Industrial Tool
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