Back in May 2016, Industrial Distribution managing editor Mike Hockett traveled to Mansfield, OH to visit MHS Industrial Supply — a family-owned and operated MRO distributor that is one of the smallest companies ID has ever featured as a Distributor Profile cover story. At the time of the visit, MHS had only 12 employees, and almost all of them wear many hats to operate the company. Despite its small stature, MHS is experienced in e-commerce, and its involvement with hardware wholesaling cooperative Do It Best and INCOM Distributor Supply enable the company to succeed compete alongside its much bigger competitors in the area.
With MHS celebrating its 80th year in business throughout 2020 and up to 15 employees as of mid-February, ID recently chatted with the company to find out what its been up to since being featured in the publication’s 2016 May/June issue.
ID: MHS’ in-house SKU count was approximately 5,500 in May 2016. What is that in-house SKU count now? Beyond that, how many total SKUs do customers have access to through the Do It Best/INCOM partnerships?
MHS: We have access to well over 100,000 SKUs through DIB/INCOM and approximately 4800 SKUs of active inventory in our own warehouse. We have plenty of room to grow that number but are more focused on stocking what’s right for our customers.
ID: When I visited MHS, the company had moved into the north Mansfield location less than a year earlier, and there was quite a bit of the 40,000-square-foot warehouse space left to grow into. About what percent of that warehouse is occupied now?
MHS: MHS currently uses about 60 percent of the warehouse, while leasing another 15 percent.
ID: Our Distributor Profile talked about MHS’s relationship with Do It Best and INCOM and how those relationships gave MHS the resources to compete with the large national distributors — a handful of which are based in Ohio. How would you say those relationships have evolved or strengthened over the past few years?
MHS: Our relationship with Do It Best has strengthened over the years as they grow their industrial business. INCOM continues to add staff that understand the industrial market which, in turn, helps us expand our vendor base. We are generating growth through several new lines from INCOM.
ID: At the time I visited in May 2016, the overall industrial supply market was in the midst of a recession tied to the oil & gas rig downturn. Since then, 2017 and 2018 seemed to be pretty healthy years for most industrial distributors, while 2019 has been back to contraction for many. Can you comment on how overall business has been for MHS over 2017-2019?
MHS: MHS has always weathered down years fairly well. Like many family businesses, our focus is on longevity and sustainability rather than short term gains, which helps us when the market is down. We want to be here for our customers for another 20 years. 2018 was an outlier year for us as we benefited from some large, one-time sales.
ID: Any pending plans for expansion that the company can share? Any new product lines added in the last few years?
MHS: Our most notable expansion is in our safety offering. We brought on new partnerships with Steel Blue, Big Ass Fans and FallTech, among others. The merger of West Chester, Boss and PIP also broadened our safety lines.
ID: Any recent software/operating system/equipment upgrades?
MHS: We replaced our legacy ERP system in 2018. It was a massive undertaking for our small staff but was necessary for the modernization of our business. We went live on May 1, 2018. With this upgrade, we gain opportunities to improve processes and business insight so that we may better serve our customers.
ID: When I visited, we touched on how while MHS had an average tenure of 15 years, almost half of the then-12 employees would be eligible for retirement within the next decade and that MHS made succession planning a priority to ensure future turnover would go smoothly. Is there an update on that succession planning?
MHS: Many succession efforts are underway and continue to be a priority for our company. We brought on several new employees who are already greatly contributing to the success of our daily operations. We invested in ERP technology that will play a major role in knowledge transfer and future onboarding. We are teaming up inside and outside sales so that our customers always have a familiar face to work with, even as retirements loom. Management roles are shifting and our teams are diversifying their knowledge of other functions in the business. There's still more to be done and big shoes to fill, but we feel good about where we are and our path forward.
ID: Does MHS still hold an annual Customer Appreciation Day? If so, about how many customers and suppliers did the 2019 event host?
MHS: Yes, we had 18 vendors participate and 164 customers join us over the course of the 2.5-hour event last July. We love this yearly opportunity to interact with our customers and say thank you. We are looking forward to our 2020 event, which will be held in July.
ID: Does MHS have anything specific planned celebration or promotion-wise for its 80th anniversary this year?
MHS: For our 80th anniversary, MHS will be completing 80 hours of service within the community. We are proud of our community ties and enjoy supporting its various needs and efforts. All of our employees are excited to be giving back to the community that has given so much to us in the last 80 years. We also have special projects planned for every month throughout the year aligned to the themes of service, fundraising, customer fun days or employee appreciation.
ID: At the time I visited, MHS’ e-commerce had been active for 4 years and comprised about 2 to 2.5 percent of total sales. Has that percent changed? Has there been any further e-commerce investment?
MHS: We decided to take a step back from e-commerce temporarily while we modernized our internal technologies. When we relaunch this offering, it will be refocused on our B2B market.
ID: Any other recent company developments our readers should know?
MHS: We are utilizing the Truby Leadership and Business Development Training Program to ensure we are a cohesive high-performing team. Our dedicated staff are committed to sharing and continuing the MHS story into the future.