Thirteen years ago, Sustainable Supply was founded by Brian Fricano as an online distributor selling industrial supplies, green products, plumbing and clean room products.
Fricano had originally expected the new venture to create some supplemental income for his family so his wife could stay home and take care of their kids. But then a funny thing happened: sales exploded.
“Two days after my wife came home (from the hospital with their newborn child), we started getting a lot of orders,’’ says Fricano, who was then still working full time as a corporate sales manager for a large industrial firm. He quickly realized he needed immediate help and quickly recruited his father and mother to help process orders. Both are still working there today.
His father’s experience was especially helpful since he had experience in industrial distribution, having previously worked in the logistics supply chain group for Grainger. He helps fulfill that function with Sustainable Supply currently, and Fricano’s mother acts as the company’s controller, overseeing much of its finances.
Within two short years Sustainable Supply, which was then headquartered in Milwaukee, WI, became one of the nation’s fastest-growing online companies, posting a three-year growth of more than 500 percent. In fact, Sustainable Supply has been listed on Inc. Magazine's List of the 5,000 Fastest Growing Private Companies in the U.S. for five consecutive years while also earning Internet Retailer's Top 1,000 ranking for each of the last seven years.
This year the company, which moved to Broomfield, CO in 2013, expects sales to be between $20 million to $30 million and is cautiously optimistic for a roughly 25 percent increase. That projection certainly seems possible since sales in the first few months of 2022 were up 50 percent on a year to year basis.
Although those figures seem remarkable, the strategic steps that Fricano is taking to expand his business are risky to say the least. But, then again, he has never been afraid to take a controversial stand against maintaining the status quo. He says it is partly due to his entrepreneurial spirit.
Starting the Business
Fricano began his distribution career working in inside sales for Grainger where he learned a lot about the various aspects of the distribution business. He then moved on to become the corporate sales manager for the Bradley Corp., a company which provides innovative products specified for commercial washrooms and industrial safety applications.
He also realized that there were online opportunities for a company that wanted to focus on selling green products. “There was no one that had really taken the lead in selling green products,” he says.”We saw an opening.”
For six months he worked to develop and improve his proposed website while still working at Bradley full-time. Finally, with trepidation, he approached Bradley executives and told them of his plans, unsure of their reaction. His worries proved groundless.
Not only did Bradley support him, but his fledgling company became a distributor of their products.
As sales grew with the company’s focus on selling green products, Fricano realized that there were opportunities based on customer demands to sell complementary parts such as building and plumbing accessories to go along with existing products.
Product expansion soared. When Sustainable Supply was initially formed in 2009, it carried 10,000 products but grew over the years to eventually carry one million products in areas such as building materials, plumbing, janitorial and MRO products that were shipped from more than 50 distribution centers and manufacturers.
But Fricano realized that it was becoming increasingly difficult to maintain such an enormous amount of inventory so he recently made the difficult decision to drastically scale back the number of products the company carried.
“We really looked at the products we were selling and decided to substantially slash our dead SKU inventory and slow moving products. We wanted to move into specialization and out of selling commodity products,” he says.
He emphasizes that Sustainable Supply is much more than an online company selling products. Instead he describes Sustainable Supply as a true industrial distributor that adds value to the products they sell and offers customers the expertise of their 20 employees who collectively have more than 100 years of supply chain distribution experience.
A “Scary” Move
While a severe slashing of inventory initially saw a drop off in sales for his company, Fricano’s next move was much more controversial: last year he decided to cease selling on Amazon.com, Amazon Business and other marketplaces. Sustainable Supply had been selling through Amazon for two years and that move had resulted in strong sales, particularly in MRO products.
That “scary” move, he says, allowed the company to focus on sales through its four owned and operated e-commerce sites: SustainableSupply.com, EyewashDirect.com, TotalRestroom.com and PortableHandwashing.com. The result: sales volume increased to the company’s existing customer base, closer relationships were developed, and Sustainable Supply saw an increase in brand loyalty.
Most of the sales through Amazon had been one-shot purchases, which meant that Fricano and his staff couldn’t develop the relationships that were so important to Sustainable Supply. “It seemed to us that many customers actually were loyal to the platform and not to us as the seller. We wanted to change that.”
As he cut inventory and eliminated Amazon, Fricano introduced more helpful website features including better content, faster checkout, and payment and financing options.
“We couldn’t be happier with the results so far,” Fricanoso says.
Three of those sites are doing extremely well, Fricano notes, and it seems to justify his decision. The only website that is down - and only slightly - is PortableHandwashing.com, a change that was expected since the pandemic slowdown. However, that site had enjoyed spectacular growth over the past two years.
“Amazon was a channel we used and it was a two-year program for us to determine if it was worth it for us. We looked at the data and determined that the Amazon channel was transitory and not for repeat business. We really couldn’t build the relationships we wanted with customers,” he adds. In addition, he says, there were supply chain concerns in working with Amazon and it was taking substantial time and effort of personnel to work with them.
Fricano says Sustainable Supply and its websites have already made up for much of the loss from Amazon in a relatively short time.
While all this is going on, Sustainable Supply has strengthened its mission of selling green products and services.
“When we first started selling green products back in 2009, it was more of an add-on in the eyes of many customers,” he says.”Today, in many cases, green products are expected,” Fricano adds, noting that architects and builders involved in creating LEED-certified green buildings must use these types of green products.
In addition, Sustainable Supply offers a carbon-neutral shipping program that offsets the transportation emissions of all deliveries — at no additional cost to its customers. Fricano notes that his company also purchases carbon offsets (something he says would be easy for manufacturers and distributors to implement) for all of its facilities, as well as offering telecommuting and bike-to-work programs, and using high-efficiency lighting and building-wide recycling.
Fricano believes the future is extremely bright for Sustainable Supply as customers gradually return to work in their offices, meaning more demand for hygiene and safety products. Restaurants are finally continuing to expand and remodel after a two-year hiatus because of the pandemic, and plants increase their operating capacity resulting in a greater need for MRO products. The construction sector appears to be strong and his company gives contractors complete services by working with Fricano’s project managers and their teams – from offering design work, to specifying and delivering products needed at the job site.
This year, Sustainable Supply will also seek to invest in its digital marketing efforts and drive traffic to the company’s four websites. The company looks to add web content in order to improve search engine optimization and search rankings.
Jack Keough
“Our plans have come together and we couldn’t be more optimistic about the future for our company,” he says.
Jack Keough is president of Keough Business Communications. He was editor of Industrial Distribution for 26 years. You can reach him at [email protected].
