This article appeared in the January/February print issue of Industrial Distribution. This online version is the first of a two-part series. Part 2 will run Thursday, Feb. 19.
In January 2012, Industrial Distribution premiered its Watch List in an effort to shine light on the kind of distributor that might not make The Big 50 List. Some of these companies are too small; some don’t fit into the traditional MRO niche that The Big 50 has carved. Yet this series of short profiles takes a look at the “ones-to-watch” outside of the 50 biggest MRO distributors — notably those who are taking steps to improve operations and grow their businesses through acquisitions, training and development, product line expansion, or other best practices.
For anyone in business, the most surprising content on Updike Supply’s website is perhaps the fact that the company’s president and EVP both have their cell phone numbers listed under “Critical After-Hours Contacts.” This may not be directly at the root of Updike’s 150 percent sales growth over the last five years, but it can’t hurt for customers to know the level of commitment they receive from company leadership.
Updike Supply is an award-winning solutions provider of industrial metal cutting and forming tools, abrasives, coolant, toolholding, safety and related supplies, as well as value-added customized inventory and spend management solutions. Located in Dayton, OH, the company’s 36 team members serve customers in the lower two-thirds of Ohio, east central Indiana, and north central Kentucky.
“Updike has spent many years crafting and implementing our strategy in order to differentiate ourselves from competitors that concentrate primarily on the sales transaction process,” explains company president Steve Short. “Our approach centers on understanding what the customer perceives as value and then developing value-added solutions to satisfy each customer’s specific needs.”
For Updike, the best products, regardless of price, are of no value if they aren’t immediately available when you need them. Short describes an example of how the company has risen to a challenge posed by a key customer looking for an easier re-ordering process.
“Updike ‘SimplScan’ is an example of listening to customers and developing a solution to address their expressed desire for a low cost, simplified means to reorder MRO supplies. Within 10 days of the customer discussion, the Updike team developed a smartphone based app, SimplScan, that scans QR codes and seamlessly emails orders to Updike with predetermined order quantities. The entire process can be completed in just a few minutes and greatly reduces transactional costs,” he explains.
It’s solutions like these that are at the heart of Updike’s value proposition and provided the underpinnings for its explosive growth. “This growth has positioned Updike as the recognized regional leader in vendor managed inventory systems and spend analysis and reporting,” says Short.
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Innovative Tooling & Accessories
Today, Innovative Tooling & Accessories, Inc. is an industrial distributor focusing on industrial fabrication and assembly markets based on the west side of Houston, TX, with a second branch in Corpus Christi. But in 1999, Innovative Tooling & Accessories was nothing more than a solid concept and some promises, based out of founder Bryan Milligan’s garage without a single dollar in the bank. So what made Innovative Tooling & Accessories come to be?
“I previously worked in the pneumatic tool business selling material removal tools, impact wrenches, and torque controlled tools. I quickly learned that there weren’t too many distributor sales reps that had application experience and the tenacity needed to gain the trust and close the sales process,” explains Milligan. “With my contacts of customers and friendships that were made while working in the manufacturing side of the tool business, I approached every one of them and asked, if I were to start my own company, would they buy from me? So away I went in December of 1999.”
Today, the company’s Houston branch has 46 employees and its new Corpus Christi branch has three employees. This distributorship has grown 50 percent every year besides 2008, according to Milligan, and it has its sights set on hitting the $25 million mark next year.
“The initiatives that were taken in order to get to the next level were getting to know customers on a more personable level,” Milligan explains. “Spending a lot of time understanding what the challenges were of fabrication and assembly of our customer base included a whole lot of after hours serviceability and having the ‘Failure is NOT an option’ motto.”
AMMEX Corporation is a Kent, WA-based importer and distributor of high quality disposable gloves and barrier protection products. Any distributor who carries this type of product knows the need to differentiate themselves in the marketplace, and who better understands competitive advantage than AMMEX — a business that’s been listed on Washington’s 100 Fastest Growing Private Companies eight times.
From AMMEX’s perspective, anyone can carry a glove line. However, “we help our clients sell more gloves,” says Danielle Salomon, the company’s digital marketing coordinator.
The AMMEX Sales Acceleration Solution (SAS) is a customized marketing program that allows clients and customers to try the product before they buy. Key items included in SAS kits are things like customized product fliers and chemical resistance charts to assist customers in selecting the right glove for the right job.
Additionally, AMMEX glove training videos are provided to educate a customer’s sales teams on information on glove materials, applications where they are used, specifications for each glove, and specific market opportunities.
“We have a humble product and continue to grow both our business and the business for our wholesale distributor clients as well,” adds Salomon.
Reynolds & Son
If you recognize the name Reynolds & Son, it may be because this company has been around this industry for an astonishing number of years — since 1874, in fact. At that time, founder George Reynolds was a man with a saying that’s been time-tested since: “Not how cheap, but how durable.”
George Reynolds would probably be glad to know that his motto has been sustained over the years, and that Reynolds & Son has kept the good parts of this classic business model, and added some modern necessities in order to remain competitive. According to Nick Papaseraphim, CFO/COO, these include aggressive investments in technology, including a full-featured ERP system, full-time IT staffing, and a robust website presence.
Additionally, Reynolds & Son is an Affiliated Distributors member company, which helps the company leverage the group’s buying power and, subsequently, offer competitive pricing for customers. Another valuable asset the company touts is its staff, and turnover remains low: “More than a third of our employees have been with the company for more than 20 years,” says Papaseraphim.
Add to this a combination of VMI, vending, and e-commerce, and this distributor is able to keep pace with some of their larger competitors. “We pride ourselves on being nimble and outperforming the larger multi-nationals in our backyard.”