In his 36 years working for industrial suppliers, David Barcomb has seen both ends of the distribution spectrum.
He spent the first 25 years at Applied Industrial Technologies, working his way from warehouse/driver in 1978 up to regional manager by the time he left the company in 2003. Since then he’s been the general manager of Troy Industrial Solutions (formerly Troy Belting) in Watervliet, NY.
Troy has a client base of 3,000 and made $18 million in revenue this past fiscal year, while Applied has more than 500 locations and earned $2.5 billion last year, coming in at No. 13 on Industrial Distribution’s 2014 Big 50 list.
Comparing customer service between two such companies, the term itself doesn’t appear to be uniform along the scale from large companies to small.
“I’ve sat on both sides. The definition of customer service — how big box service is versus that of independents — I think it’s a lot different,” said Barcomb, a board member of IDC-USA and CEN Manufacturing. “For many independents, a lot of us are doing the actual install and work on-site. We’ve evolved into maintenance support, and physical labor services to help with profitability. The big box companies can turn to other markets.”
Importance for Independents
Customer service is unquestionably a high priority for any supplier, regardless of size. Due to independents’ hands-on, face-to-face nature, it’s an especially crucial element for them.
Jeff Haggard is the Vice President of Haggard & Stocking, which has six locations and is the largest privately held industrial distributor in Indiana. Servicing the aerospace, automotive, foundry, transportation, machine tool, and fabrication markets, the company maintains an inventory of approximately 20,000 items. Haggard insists customer service is what differentiates independents from each other, and their larger competitors.
“It’s what we build our reputation on,” Haggard says. “At the end of the day, our customer can get what they want from anyone, so we have to set ourselves apart. When you get to the larger competitors, there’s a little bit of disconnect from the shop floor to the distribution center. I tell my guys, we have to make sure we know the product and how it works.”
That hands-on approach also is evident at Florence, AL-based Martin Industrial Supply. According to vice president of sales and marketing Bill Redding, Martin has recently ramped up the amount of actual face-to-face time between customer service personnel and customers.
“We spend time each week sending representatives out interacting with customers,” he says. “It builds that relationship. That differentiates us a little more from everyone else in that we invest the time to send them out. When I got here, one of the issues was that we spent so much time on the phone.”
The advantage for the independent supplier when it comes to customer service is flexibility. In an age where market data is now immediately available, smaller distributors are often more adept at making necessary changes to their product lines, or just the way business is done, with less hassle than those with 100+ locations.
“Overall, I think customer service is just as important to the large distributors. The small ones need to be able to compete with them,” says Bob Linderman, director of strategic accounts for Industrial Buyers Consortium (IBC), a buying group comprised of independent distributors and their suppliers. “They have to be nimble, adapt to changes. The advantage to the small companies is they can have that nimbleness and not have to go through a lot of red tape.
“It’s really about being flexible, especially when it comes to invoicing. The larger ones are outsourcing it to third parties. You need to have the reporting and capabilities to react to that. That’s key for small independents.”
Websites & Technology
Today, customer service often starts with the company website. Industrial customers aren’t satisfied with just any basic website anymore; they’re looking for a sharp, user-friendly one that connects them with what they need.
For Troy Industrial Supply’s website, it’s all about the personal connection. Troy includes a link to the entire company directory, including phone extensions and emails. Barcomb said it’s the most visited page of the website. Additionally, Troy’s resources tab includes links to training sessions, tech tips, and video.
“I think we’ve certainly made an effort to invest marketing into technology,” Barcomb said. “Our website has been refreshed a couple times. We don’t thump our chest about how great we are. It’s not about Troy, it’s about the customer. I think we’ve geared the website to helping.”
An interesting feature of Haggard & Stocking’s website is its blog section, where department heads share best practices, company news and awards, and personal motivational stories. The company started blogging at the beginning of 2009 and have been posting regularly since.
“We’ve had very positive feedback,” Haggard says. “I like the personal touch stories about how we’re all a part of providing resources and tools to customers for their everyday lives. We want them to know they’re important.”
IBC’s website has its own blog section, and director of national accounts Ted Buck says blogging is a great way for distributors to connect to their customers.
“It helps to personalize these distributors,” he says. “Sometimes a blog is about giving back to the community, about an industry trend, or an award.”
Buck and Linderman say that self-service portals have become a big trend in industrial distribution, with customers wanting the ability to track orders through RFID technology, whether through tablets, phones, laptops, or desktop computers.
“There’s a wealth of information the customer is taking,” Linderman says. “They can run their own reports based on a data field.”
The widespread use of social media isn’t anything new to industrial distributors, but that doesn’t mean everyone utilizes it. Despite the explosion in distributors adding Facebook pages, or accounts on Twitter or LinkedIn to further connect with customers, many independents have yet to jump on the bandwagon. Not that they refuse to, but because their customers haven’t demanded it.
“We have not seen the desire from the customer base to need or want the social media side of the business,” Redding says of Martin. “That’s not our world yet. Like with everything, I think that’s coming.”
On the opposite side, Haggard & Stocking is active on Facebook, Twitter, and LinkedIn, and has used them to interact with customers.
“I’ve seen a lot of questions come through that,” Haggard says. “Customers will communicate, ‘I saw this on your Facebook/Twitter feed.’ We’ve seen a lot of activity.”
At IBC, Buck and Linderman say they’re always getting calls from distributors asking how to get off the ground with social networking: How to get an account started, and how to make those pages look professional.
At Haggard & Stocking, Haggard says his company has invested heavily in its information technology department with the growing usage of its website and social media channels — so much so that it’s the company’s largest growing sector as of late. Haggard’s philosophy is that for industrial distributors, embracing and utilizing social media will only help.
“Part of social media is telling your story. No one is going to wave your flag more than you are,” Haggard says. “We need to communicate the cost savings and service we provide. Part of that is through social media. It entices people to stay and new ones to come in. If we don’t use it, we get left behind.”
Do you have any thoughts on customer service for independent distributors or want to share practices of your own? Please leave them in the comments or contact Mike Hockett at firstname.lastname@example.org