David Mayer, owner of JMC Sales & Engineering, Inc ., in Indianapolis, is a traditionalist in a traditional business: selling machine tool accessories, cutting tools and abrasives. As the proprietor of a small distributorship, he tries to remain small enough to service customers and keep the "hands-on" relationships that are the hallmark of small businesses, while becoming technologically efficient and growing to fill customers' needs. JMC Sales sells the kinds of MRO products that have been the mainstay of many industrial distributors for 100 years, but Mayer is savvy enough to know that good products are only part of a successful sales organization in 2003. Speed, flexibility, expertise and an array of service offerings are needed, as well.

JMC Sales is battling a poor industrial economy, the departure of customers to other countries and a shortage of people interested in working in industrial distribution. Like many other distributors, Mayer is caught in a slow-to-change business that is inundated with pressure from suppliers and customers to upgrade technology. But he's in a business he has loved for more than 30 years, dealing in the products that drive American industry.

Mayer was discharged from the army in 1971 and went to work for Sandvik Coromant Corp., selling the company's indexable carbide tools and toolholders. His relationship with Sandvik is strong to this day.

During his years with Sandvik, he met Joe Joachim, the owner of Joachim Machinery Co., a machine tools distributor in Indianapolis. They became friends as well as colleagues, and Joachim asked Mayer to start a machine accessories sales division within the company. Mayer began JMC Sales in 1991.

Prior to starting the business, Mayer spent four months talking with customers, developing accounts and interviewing potential employees. His experience selling tools, and the contacts he'd made, allowed him to start the business strongly, and grow.

At that time, Joachim's product mix was mostly machine tools. Mayer's association with Joachim Machinery meant that offering accessories and tooling for machines made a complete package.

"We brought in the products that made sense – machine accessories and tooling, and measuring tools along with that," Mayer says. "My relationship with Joe Joachim helped immensely, of course."

In 1993, JMC Sales outgrew the space it occupied at Joachim Machinery and built its current building next to the Joachim Machinery premises. In 2002, Mayer bought Joachim's interest in the business, becoming the sole owner.

As the technical engineering side of the business grew, Mayer added "engineering" to his firm's name. A big part of his business is answering customers' technical questions, and he hopes to add more technical services to his in-house repertoire in the near future.

Like everyone else, big customers are trying to save money. One of the ways to do that is to contract for "soft" services like engineering, design and blue- printing. Many of his customers farm out some design work, and most of their engineering work is done by outside contractors, he adds.

Is luck involved in building a small business? Since people are the backbone of every enterprise, Mayer admits to having "wonderful luck" in finding the core people in his sales department.

"We have some great inside salespeople here, as well as outside people," he says.

As an example, he points to Kay Messick, the company's top outside salesperson, who began in the inside sales department.

Two of his experienced inside salespeople, Jan Overton and Elaine Eller (Eller is now the operations manager), worked in the Indianapolis office of Sandvik before it closed in 1982. They chose to find jobs in distribution, and have grown in both the traditional aspects of selling products and in learning to help run the business.

Expertise in machinery, machine shops and metalworking always helps, but people possessing those skills are getting harder to find, according to Mayer. Enthusiasm for the business appears to be waning too, making it that much more difficult to compete on an equal level with larger distributors, he adds.

Mayer wants to hire people who can adapt to changes in the business, such as the increasing use of computers and increasing reliance on the distributor for technical expertise. Yet, potential employees must hold to the traditional tenets of industrial distribution, which include training customers, spending a good deal of time solving a customer's problem, or delivering an item during off hours. All things considered, Mayer says he's fortunate when he finds a young worker ready to learn the business.

"I just hired an eager young man who wants to come in and learn," Mayer says. "Hiring him happened after interviewing six people with a lot more experience but, it seemed to me, with a lot less enthusiasm."

At Allison Transmission in Indianapolis, JMC has shared an integrated supply agreement for three years with Full Service Supply Co., based in Livonia, Mich. The agreement is an offshoot of the typical integrated supply agreement, in that JMC controls the purchasing function but does not handle any inventory at the customer's plant.

"When you do [integrated supply], you get everything, but this is not a complete integration because we don't handle the inventory in the plant. The labor union in-house will not let us touch the tool inventory at this time," Mayer says.

Allison's accumulated inventory of perishable goods had skyrocketed because every department ordered its own items, and duplication was rampant, Mayer says. Quantity buying was spotty, at best. JMC is able to control purchasing quantities for Allison. Every order is shipped to the customer complete, a boon to the receiving, payables and stocking departments.

This kind of agreement is in jeopardy if a customer is bought out, Mayer says. New owners send orders to their own suppliers, which is happening regularly in the depressed manufacturing arena of the Midwest, he says.

However, staying connected with other distributors is one way to share business and stay in the contract loop. JMC is linked to Prophet 21's Trading Partner Connect system, enabling the company to trade with other distributors in the network. The system particularly helps with finding MRO products, Mayer says. JMC is a member of the Industrial Distribution Assn., and the Indiana Industrial Distributors Assn.

More innovations, such as a faster computer network and joining forces in joint ventures like that at Allison Transmission, will become part of his company's business when the time is right, Mayer adds. JMC sells Sandvik Coromant products to Allison, as part of the contract.

Alan Keep is the regional sales manager for Sandvik Coromant , based in Pontiac, Mich. Sandvik is one of JMC's major suppliers.

Keep met Mayer in the 1970s, when Mayer called on a small machine shop where Keep worked. Eventually, both ended up working for Sandvik. Keep says that if anyone can continue to grow lines and engineer special machinery applications, it's Mayer.

"I admire Dave for taking the risk to start a distributorship, which he left Sandvik to do," Keep says. "He's definitely a top-notch tooling provider in Indiana, and is always customer-oriented."

Sandvik products are part of JMC's integrated supply offering, Keep says.

"We don't have exclusive distributor situations, but try to support companies like JMC in every way we can," he says. "[JMC] is one of the top technical distributors we work with. They are committed to the full range of services for every customer."

To illustrate the difficulty of growing sales while customers leave the region, Mayer notes that he received a large order for a company through his relationship with its main offices in Indiana. The order involved setting up machinery in Huntsville, Ala. Most likely, JMC will not be called to service the account in the future, Mayer says. A local distributor will do that.

"As engineering services become more imperative, I'd like the customer to call me, and I can go in and do the programming, do the tooling, and fix machine problems. That would be ideal," Mayer says. "Most big companies are farming a lot of that out, rather than hiring employees and having to pay benefits."

He is convinced that large manufacturers will never again hire great numbers of full-time engineers and designers.

"The expertise in engineering today is not as great as it was. I don't think people understand the need," Mayer says. "Look at the state of manufacturing today. The nation can't keep up in quality or speed, and the state of Indiana, like others, is in real trouble."

One of the traditional ways to keep, or gain, market share, has been to take on more product lines. Mayer has done that, but it's a two-way street. Each supplier wants to see growth in its line. They put time and effort into setting up a distributor, and expect and deserve a return on that investment. At one time, JMC grew every line it had, every year, but that is no longer the case, he says.

"We now have all the chuck lines, and all the cutting tool lines. They come to us and say 'How are you going to grow our line?' but I'm not sure we can," he says.

When a company moves its operations out of the United States, it's another blow to regional suppliers such as JMC, since small distributors rely on long-term, close relationships with local buyers, Mayer notes. National contracts tend to affect his business as well, because national buyers use bigger distributors with whom they have relationships, and drop the smaller ones in the name of cost savings, even if they are local.

The "rust belt" syndrome that afflicts Midwest manufacturing affects companies in many ways, and the response for a business like JMC can be elusive. Mayer's company has received an unexpected, large order once a year for the past several years. They help keep his bottom line growing. In fact, JMC has never had a negative year, in the 13 years it's been in existence. Still, 2002 saw only small growth of 5 percent, and 2003 may not be much better.

With commitment, growth will continue. While it may depend in part on a better economy and hiring and training the right people, Mayer and his staff will continue to offer technical expertise and product innovations.

The next five years hold some exciting prospects for the company, but Mayer is not sure what will grow the most: market share, gaining new customers, sales of services like programming, expanding integrated supply agreements, or selling more to existing customers. He believes it will not be the latter. Companies moving to southern states or out of the country, seeking cheaper labor, probably will not reverse that cycle any time soon.

Keeping one eye on the traditions of the past and the other on the pulse of the rapidly changing industrial environment, Mayer plans to have more business solutions in place, to ensure the company's growth in the Indiana marketplace.