Since its 1983 inception in founder Ken Douglas' garage, Indianapolis-based Airline Fasteners & Supplies Inc. has grown into a thriving fasteners and pneumatic tools distributorship based on a deceptively simple philosophy: An unrelenting concentration on exemplary customer service.

President and CEO Kimberly Rastrelli, Ken Douglas' daughter, says that focus has helped the company weather the downturn in the residential housing market. That sector has fallen off by about 40 percent in the Indianapolis area, she estimates, but although its fortunes are closely tied to that industry, Airline Fasteners' business is down a mere 5 percent.

That's partly due to a clever redesign of the company's showroom (see sidebar, page 23), spearheaded by operations manager Troy Lamb.

Rastrelli says another program that keeps customers coming back is Airline's policy of giving free tools to frequent customers.

“We have a loyalty rewards program. [Customers] are rewarded with tools as their fastener purchases reach a certain level. It's a tracking thing—as soon as you reach a [certain] level you're rewarded,” she explains. “That has been a major, major success for us.”

But the biggest factor in Airline's success is likely the free repair service the company offers to clients, Rastrelli says. Airline Fasteners keeps four vehicles on the road, visiting job sites and making sales and repair calls, staffed by a quartet of salesmen ready to tear down all the tools they sell and repair them. Airline sees to about 100 ailing tools a week, she says, noting that the company is the only local distributor to carry Paslode's line of cordless, gas-fired nailing guns.

“Service is what we strive to be the best at,” Rastrelli says. “That's really how we built this business.

If it can be fixed, we can fix it. We're instantly ready to respond. Within 45 minutes we can be just about anywhere [in the Indianapolis area]. That has played a major role in keeping our customers satisfied.”

“Anybody can sell a box of nails,” Lamb adds. “As far as keeping a customer satisfied, keeping him working, that takes dedication to service.”

The company employs 10 people; in addition to Rastrelli, Lamb and an administrative employee, Airline has a trio of inside salesmen/repair technicians and the four outside sales representatives.

The watchword for everyone is flexibility, Rastrelli says.

“They do anything that needs to be done between the three of them,” she says of the inside sales reps/technicians. “And Troy might be operations manager, but he gets back there and wrenches a tool or makes a delivery—he's been here 20 years and he knows everybody.”

The lone exception might be Rastrelli, she adds.

“They keep me away from the tools,” she says with a laugh.

Airline Fasteners' single location consists of a roughly 8,000-square-foot warehouse and about 2,000 square feet of office and showroom space. About 70 percent of Airline's $3.5 million annual revenues come from fastener sales, with the remaining 30 percent coming from sales of tools and accessories such as hammers, ladders and safety equipment.

“We do sell a lot of tools, but fasteners are the majority of our business,” Rastrelli notes.

Her father ran the company from the family garage for eight years until it moved to its current location on the south side of Indianapolis. When he passed away in 1997, Rastrelli's mother Karen Douglas took the reins of the business and ran it until her death in 2000.

Rastrelli didn't plan to join the family business, though she did work there part-time while getting a degree in journalism from Indiana University. But in 1993 she began working full-time at Airline, taking on accounts receivable and data entry duties and gradually assuming more and more responsibility. She took over as president and CEO after her mother's death.

Along with the business, Rastrelli inherited a dedication to customer service from her parents. That dedication is the main reason Joe Getchell, co-owner with brother John of framing contractor Getchell Brothers, keeps doing business with Airline.

“Everybody can compete on the price of nails,” Getchell says, citing the above-and-beyond efforts of Airline salesman Harry Kiphart. “He'll drive anywhere in the state of Indiana for me. If he can fix it, if he's got the stuff on his van to fix a tool, he'll stand there and fix 10 guns for me. That's what we want, rather than saving $5 or $10 on a box of nails.”

The relationship began two years ago when Kiphart pulled up at a Getchell job site and asked if the company needed any nails. They didn't—in fact, at that time Getchell did business with a competing fastener distributor.

But Kiphart repaired some broken nailers anyway, free of charge, even after Getchell told him he was happy with the competitor.

“If you have tools that are down and [the distributor] has to take them back to their shop because they don't want to take the time to fix them, sometimes you're looking at a week to repair some of those tools when maybe it's a five minute job to replace an o-ring,” Getchell says. “I've been with Airline for two years and I've been to their store one time. That kind of makes you realize how good their on-the-road service is. … [Kiphart] was delivering nails to my house on a Saturday when he doesn't even work. He's done that a number of times. I once asked [another fastener salesman] if he could do what Harry does for us and he said Harry couldn't be too concerned with his commission if he was doing that kind of thing. That kind of says it all about their business.”

Kiphart, who's worked at Airline for about five years, says that's just part of the job.

“Whatever it takes to make sure the guys have supplies. It's a time-sensitive, crucial business when you're framing and we just like to make sure everything goes right,” he says.

For Scott Dunbar of Dunbar Construction, another Indianapolis framing outfit, the reason for staying with Airline is simple.

“Their service is just unbelievable,” Dunbar says. “It's actually a privilege to do business with them. They take care of us. I can't say enough.”

Dunbar cites a pair of episodes as emblematic of the service level his company receives from Airline. In one instance, an accounting error led to Dunbar paying Airline twice for a single order, he says.

“Somehow our accounting got screwed up and we paid a bill twice,” he recalls. “We had actually left [Airline] to try somebody else and even at the time that we were gone … they still called and told us we had a check coming. You wouldn't get a lot of companies that would do that.”

In the second instance, about 20 cordless nail guns “went bad,” he remembers.

“They brought out new ones for us,” he says. “Usually they get on our stuff the same day. I'll call and they'll get there within the hour. Their prices are just very, very fair. It's just an outstanding company. It's an honor to have somebody who cares as much about what they do as I do. That's hard to find anymore.”

Another reason for Airline's continuing success is loyalty—to customers, to suppliers and especially to employees, Rastrelli says.

“We are very loyal to our employees. Everyone here has to wear many hats. … They've stayed when perhaps they've had a better offer,” she says, adding that the shortest-tenured employee has been with the company five years.

One reason for that is Airline's comprehensive benefits package. The company recently changed its health insurance policy from a traditional HMO program to a health savings account (HSA) policy, under which it pays 100 percent of each employee's insurance premiums and contributes $100 a month to their HSAs.

“The premiums really dropped because the deductible dropped. It's so much more flexible than a traditional health plan,” Rastrelli explains.

Another benefit is Airline Fasteners' 401K retirement program, in which the company matches up to 3 percent of employee contributions.

A generous vacation allowance—15 days each year—and a flexible, understanding attitude are also important, Rastrelli says.

“Everybody here has had something [in their personal life to deal with] at some point,” Rastrelli notes.

“We're more than willing to work with people,” Lamb adds, citing an “open door policy” when it comes to dealing with employees.

When it comes to supplier loyalty, Rastrelli says the company's relationship with Paslode, which dates back to 1967 and her father's years as a Paslode repair technician and salesman prior to starting Airline Fasteners, is another key to the company's success.

“They were very generous with my dad in helping him get set up. I remember him saying they made a lot of drop shipments to help him get started,” she says.

That loyalty goes both ways—Paslode is the only nail-and-tool combination line Airline carries. In return, Paslode makes sure Airline has access to the latest products, according to Rastrelli, who notes that her company was one of only three distributors nationwide to receive the first models of Paslode's latest line of cordless nail guns, a technology the company pioneered.

“It shows that we have a very good working relationship with them. A lot of times [our customers] mix us up and think we are Paslode. If anybody in the area has a question, they just immediately think of us. It really has given us a big niche in the beginning and now has really let us expand on that, earn people's trust and get good business from them,” she says.

“The loyalty that Paslode and we have enjoyed is transferred to our customers,” Rastrelli adds. “Customers might have to spend a bit more to have us, but I would have to say that's been a big reason for our success, knowing we will be here to do the job.”

Paslode senior sales representative John Radcliff says that longstanding loyalty is one of many reasons his company values its relationship with Airline.

“We call ourselves a premier tool and nail company; we're definitely not the cheapest and sometimes we're the highest. They never try to undercut us with other lines of nails or tools, which most distributors seem to do these days,” Radcliff explains. “We wish every single distributor was more like them. They're just spectacular. They're definitely my favorite distributor to work with.”

Giving Airline the opportunity to be one of the first distributors to sell the new nail gun line was a simple way to express Paslode's appreciation for the company, he adds.

“That's kind of a big deal. We don't like launching a tool with just anybody. They've been extremely successful with this line of tools and they've done a great job with it so far,” Radcliff notes. “They've always treated the Paslode line as a premier line and they've just always been very loyal. … Sometimes these distributors can get higher margins with things like [low-cost Chinese imports]. Airline's never had to do that with us. They're just a distributor we wish everybody could be like.”

The housing crunch isn't the only challenge facing Airline Fasteners; ever-rising fuel prices and vehicle maintenance costs also pose a problem. And fluctuating commodity prices—especially for the steel used to make fasteners—combined with competition from low-cost Chinese imports only add to the challenge.

Rastrelli says the business withstood a series of price increases during 2004 that amounted to a roughly 20 percent hike over the course of the year. Though the next two years saw a series of small decreases, in late 2007 prices rose another 4 percent and an increase of up to 6 percent went into effect Jan. 15, she notes.

“It's a challenge, but no more so than in any other industry,” she says.

As for their bread-and-butter housing market, Lamb believes the biggest detriment in the Indianapolis area is a decline in Levittown-style tract house developments.

“What's actually decreased, more than anything, is tract homes. Those are down. That's what's actually hurting this market. Custom builders are staying their course. Commercial building is what's growing,” he says. “The key market over the next few years is those commercial and industrial accounts.”

The upside for Airline is Indiana's effort to attract new business to the area. Lamb cites major new projects that are planned or underway for the Indianapolis region, including a new AT&T campus, a Cabela's water park, a Nestle water bottling plant and a Honda plant. The workers who will staff those facilities will need places to live, he says.

“I think that's going to offset a lot of the housing problems,” Lamb says.

“We are seeing a lot of efforts to bring business in,” Rastrelli adds.

But no matter what business you're in, Lamb notes, the next year or two will be challenging.

“It doesn't matter where you're at right now, you're seeing a lot of challenges to keep your business rolling and keep your edge,” he says.