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Tell me a little bit about your companies.
Glen Corkill: In 2005, Source NA purchased Ace Tank & Fueling
Equipment, a Seattle-based distribution company with a 70-year legacy
in a great market. Ace was a manufacturer that sold off all its
assets except the distribution side in 2003. Manufacturing, however,
was its stronger suit, and soon after selling those assets, the
company started to go into bankruptcy. Source NA kept the name “Ace”
because of the brand recognition.
Timothy Woofter: Stanwade Metal Products is in its second generation. My father started the company 60 years ago.
Nama Namasivayam: National Energy Equipment Co. has 14 stocking and two satellite locations across Canada. Our strength is our 330 employees. The company has grown quite a bit over the last six years. We've become more focused, entered niche markets and grown internally. At 60 years, we are in a position to choose what we want to do.
Jeff Brooks: My family purchased Spigler Petroleum Equipment three years ago. We've always wanted to be a distributor, and Spigler's 70-year reputation and name meant a lot in the marketplace. The company lacked leadership after the death of the owner. His two children stayed on and currently are active with the company.
How do you help your employees embrace
change?
Glen Corkill: It wasn't difficult for the employees to embrace
change when we purchased Ace. When you get that close to bankruptcy,
it's change or die.
Nama Namasivayam: We give people the responsibility and the authority to make the decisions, and they have a lot of leeway. That authority is a motivator.
Timothy Woofter: Change in processes and methods is always difficult. The employee and the manager know whether or not something works. If it works to their benefit, they have no problem with change.
What do you think was the toughest time
for your company?
Glen Corkill: I think when Ace went into bankruptcy.
Jeff Brooks: Probably after the owner passed away, and the company lacked leadership.
Nama Namasivayam: National Energy Equipment has grown very fast in the last few years, and we had to get more focused in our operations.
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Timothy Woofter: The early '80s, without a doubt. Stanwade merged with another company in 1980. The combined sales of both companies prior to the merger was $5.5M. After the merger, sales dropped to $3.5M. The phone stopped ringing, especially for the standard petroleum tanks and products.
What did you do?
Timothy Woofter: We reduced our labor force from 53 to the
low 20s, closed the plant the other company had, and moved everything
to our Hartford facility. Today, we're back up to 50 employees at
one location.
With fewer people doing more work, how
do you maximize efficiencies?
Timothy Woofter: We automate whatever we can.
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Jeff Brooks: I surround myself with good key players whom I can trust.
Nama Namasivayam: Last year, we upgraded computers to include an Enterprise Resource Planning (ERP) system, which showed that we had challenges in the warehouse. The mistakes were all human error, people shipping the wrong item. So we installed barcodes on products at our biggest location, in Ontario, which holds $5.5M in inventory. Shipping errors were reduced from 25, 30 a month down to 1 or 2. We'll be incorporating this system at our other locations.
In addition to changing internal processes, what else did you do?
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Nama Namasivayam: Our fast growth came with some challenges. This year National Energy Equipment is focusing on customer service, and we set the bar pretty high for ourselves. Everyone in the company is on commission or a profit-sharing program. We developed “Ten Commandments for Customer Service.” Half of an employee's bonus comes from the company making a profit; the other half comes from these customer service components.
Glen Corkill: Source NA has been using enterprise software for a while, and our back room is centralized. So is the warehouse. From the monitor on my desk in Addison, Illinois, I can see what is going on at each of our 11 locations, including phone activity. I know sales numbers and order numbers. I can dive down into every order. I can see trends.
Nama says retaining people is one of his
company's biggest challenges. Tim, that's not a concern for Stanwade?
Timothy Woofter: Of course, it's hard to find really good
people. Always is. But right now, the unemployment rate in our area
is 11 percent, compared to the national rate of 4.5 percent. So
if I lose someone today, I'll have three people coming in to fill
out applications tomorrow.
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Some people say there is no such thing
as a new idea. What old idea have you taken out of the closet, brushed
off, and applied to a new challenge?
Jeff Brooks: I don't agree with that. I think there are new
ideas out there. Our industry is constantly changing and so must
we.
Nama Namasivayam: At the end of the day, there is only one thing—customer service. That's not a new idea. Go back to the basics—return a call within a half hour and be the first to deliver bad news. No one wants to give bad news to a customer.
What attributes does your company have
that guarantee its survival?
Timothy Woofter: We are responsive to our customers, and
we have no debt. If the phone stopped ringing again, we could weather
it and survive.
Nama Namasivayam: Superior customer service and the ability to change and be flexible.
Jeff Brooks: In the distribution business, the part must be in stock when it's needed. Spigler has a reputation for the size of its on-shelf inventory, which is around $600,000.
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What's the most important thing young people
entering this business must know?
Timothy Woofter: They must have a full, rounded knowledge
of all the products they sell.
Nama Namasivayam: We no longer look for industrial experience. If they have the right attitude, they can learn anything.
Jeff Brooks: They have to be committed to learning the industry and willing to put in a lot of hours, especially those working in service. They also must be willing to learn new things, particularly with electronics, an often-changing arena.
Tim, you followed your father in leadership.
Do you have a third generation coming into the business?
Timothy Woofter: No, we don't. I told my father about 25
years ago that if he didn't hire his first grandchild, he wouldn't
have to hire all 17 of them, and I asked him how in the world he
would ever fire one. So we never hired any of them. There will be
no third generation here, but we have good backup management. Our
stockholders are wise enough, should I hit a tree or something,
that they could move things forward.
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