A sizable portion of best-practice articles, presentations and webinars in the industrial supply sector focus on digitization, or — more specifically — how to get your company on a digital level that matches customers’ changing demands and buying habits.
It’s a challenge many industrial distributors and suppliers have struggled with for years, and those succeeding are reaping the benefits.
One of those greatly benefitting from their digital efforts is Kansas City, MO-based Midland Metal MFG., a supplier of fittings, valves and accessories for hose, pipe and tubing and one of the first such industrial companies to fully immerse itself in the online side of business.
Midland has been offering e-commerce to its distributors since 2003, making it a key part of its culture today and providing customers easy ways to provide the feedback the company bases all its business decisions on.
“We’ve been doing it for a long time and we’ve been trying to stay ahead,” says Midland national sales manager Brett Powell.
It’s all part of Midland’s goal to be the easiest supplier for distributors to do business with and motto of “too convenient NOT to buy from.”
Midland At A Glance
Midland’s roots date back all the way to 1919 when it manufactured airplane parts and roof flashings, among other things. But its modern story begins in 1980 when Bill Hodes bought the company and transformed it into a brass fitting master distributor as a spinoff of his plumbing wholesale business. It had $60,000 in sales that first year. Bill’s son Nick took over the company in 1985 and grew sales to $14 million by 1999. During that time, Midland expanded its product line to include lead-free brass, bronze, stainless steel and malleable iron cast fittings and nipples, valves, hose clamps, hydraulic, pneumatic and hose accessories.
Midland — which has a headcount of 50 employees — contracts out most of its manufacturing to small and large machine shops in the U.S. and overseas. Along with Kansas City, it has stocking locations in Kerman, CA; Houston, TX; and Atlanta, GA.
Midland began offering a 5 percent discount on online orders when it first launched e-commerce in 2003, and continues that incentive today. Customer adoption was slow-going in those early years of it, with roughly 5-10 percent of orders done on the platform. But Powell estimates that percentage at around 60 percent as of 2012, and is up to approximately 75 percent as of August 2017.
Customers can check Midland’s inventory online at all four of its locations from their phone, tablet or computer. The company overhauled its search engine several years ago to enable customers to simply enter a part number or part of its description, and the system will pull up that product’s information. Customers can also track shipments online, pull up catalog pages and find product specifications and manage every aspect of their orders — including downloading them from Excel spreadsheets.
“It definitely gives us an advantage because it makes life easier on the customer,” Powell says. “Customers today don’t have as much time to pick up the phone and find out information and track down the right person.”
Midland has included customer comment boxes on its e-commerce ever since its launch 14 years ago, and it has enabled the company to mold that offering based on feedback. At one point, that feedback indicated customers didn’t like the way their order item sequence showed, so Midland allowed them to customize it.
The growth of Midland’s e-commerce has also aided its sales and customer service team, rather than replace it — as is the concern of some in the industry regarding business technology.
“It’s lightened the load of order entry, but it’s still very important to us to have a human being answer the phone and take care of things,” Powell says. “It gives the customer service person and inside sales team time to build relationships because they’re not busy doing data or order entry all day long.”
Midland’s digital offerings go far beyond just e-commerce. Midland’s website is packed with product information, catalogs, customer marketing tools, company information and it makes it easy to create an account. The website also has a ‘Knowledge Bank’ section loaded with educational PDFs for need-to-know information about products.
“We put way more information online than in our print catalog,” Powell says. “It’s important for customers to have that quick, instant information of knowing what’s in stock and when it’s going to ship.”
Midland’s mobile app — launched in 2012 — is able to scan barcodes. The company offers private bin labels that customers can order online and print, which the app can then scan and pull up product information, stock levels, price. Customers can also load up a purchase order with the app, which allows them to save and finish the order later.
The company also experimented with launching another app for customers looking for bin stocking, but ultimately nixed the project as it required more work for the distributor.
“It was worth a try because we were listening to the customer,” Powell says. “We try to come up with tools to help distributors compete, and we have some new and exciting things on the way.”
Chief Technology Officer Charlie Teischner is a key part of the company’s digital and e-commerce success as the person tasked with making adjustments on the back-end to match customer feedback.
“It’s a great value, the little tweaks here and there we make for how the customer wants to communicate the business with us,” Midland vice president and owner Billy Hodes says. “It really comes from those relationships with Brett (Powell) and our sales staff built, and then having the great resources of having Charlie and the IT staff being able to perform.”
Midland has a custom catalog program that allows its distributor customers to design the front and back cover, set custom pricing and include their company logo and contact information on the footer of each page. It is working on a website (brasscatalog.com) where distributors can print off sections of Midland’s catalog to use as their own. The 2017 catalog edition is 579 pages.
“A lot of the programs we’ve built have been aimed at the distributor salesperson,” Powell says. “We’ve tried to offer a one-source solution.”
Our Brand Is YOUR Brand
One of Midland’s key services is being a shipping and distribution source for its customers. As a result, those distributor customers gain the advantage having bigger capabilities than they have in-house, which is appealing to their own customers.
“Our customers trust us with their customers,” Vince Hodes states. “We shipped more than 14,000 drop ship orders for our customers last year.”
That leads into Midland’s private shipping program. Distributors can add a bunch of products and ship them directly to their customers with their name and logo on all packaging and paperwork. In doing so, Midland is protecting its distributors and enabling them to sell products as their own. Every Midland part number label that gets shipped out can have the distributor’s name on it. Their boxes are generic — you won’t find Midland’s logo on them anywhere. The company doesn’t have minimum piece orders, either.
“They’re able to pick up new business and get into new product groups easily, as opposed to have to figure out ‘what am I going to stock?’ and ‘how am I going to put a catalog together?’” Powell explains about distributors.
Midland’s culture starts with Vince Hodes, who implemented a company-wide bonus structure during the company’s rapid growth in the 2000’s that is still in place today. Everyone from the person sweeping the warehouse floors to the executives is bonused every month based on the company’s performance. Those performance numbers are published every day for every person working at Midland to see.
“We feel ownership and have that extra motivation to do the best we can to take care of the customers and represent the company in the best way,” Powell says. “It’s helped our customer service and we have next-to-zero employee turnover.”
Powell could name a half dozen management-level employees who have been with the company at least 18 years. There are 26 Midland employees overall who have more than 10 years’ experience there.
“There’s a lot to be said for that,” Billy Hodes says. “We have zero turnover, which means we can move forward faster and not spend time retraining people on our systems or products. We are constantly working on new things and building on them to make life easier for our customers and become more transparent with them.”
Powell echoes that sentiment, adding that it reverberates throughout the company.
“We try to create a team atmosphere all the way to the manufacturer rep, to someone putting compression nuts on fittings,” Powell adds. “It’s paid off for us a ton because you have reliable people and so many salespeople who have long relationships with customers.”