More Bang for Your Buck
Last Year, CleanPower, who operates branches throughout Wisconsin, put out a request for proposal that would consolidate multiple product vendors. For nearly 28 years CleanPower worked with a number of different vendors who each had their own processes, billing and delivery procedures.
CleanPower at times would receive training from the supplier, but representatives from the company realized that if they were to continue to grow they would need more training, support and competitive pricing.
Other areas of concern were managers having to drop off supplies at job sites and timely updating of the material safety data sheets (MSDS).
CleanPower now contracts with one main supplier who delivers to every account they service and will pull orders, no matter how small, based on the specific needs of a particular account. The vendor also will break down case lots to meet the available storage space within the facility, and will deliver to the exact location as requested. In addition, they’ve provided MSDS books for each location that CleanPower services. Currently the vendor is in the process of developing a training program that utilizes the expertise of the manufacturers of the products CleanPower uses.
“It’s been an educational experience,” says Mark Wartgow, district manager for CleanPower. “Since the switch our managers have had more time to manage due to the delivery process and online ordering. We’re now looking at implementing an Electronic Data Interchange billing process. A lot has changed in the last five months and we feel confident that we made the right choice.”
CleanPower is not alone in the need for value-added services from a jan/san distributor. Product prices have risen over the last few years as the cost of oil, insurance and doing business in general has increased. Building service contractors are getting “less bang for their buck” when it comes to their product purchases. They rely on value-added services to compensate for the high cost of products.
During this time of high prices it’s more important than ever to ensure BSCs are getting all they can out of their vendor relationships. Unfortunately for some contractors, these relationships are lacking. If BSCs aren’t receiving the help they need to run their businesses more efficiently, it may be time to re-evaluate relationships or start new ones.
“With any process, if you want to continually improve, you need to continually re-evaluate it,” says Jim Peduto, president of Matrix Integrated Facility Management, Johnson City, N.Y. “With vendors, ask, ‘What value does my distributor add to my business: Does he get me business, train my employees or help me with difficult projects?’ If all the distributor is going to do is supply product, how much is it worth to make the drop?”
The number-one reason BSCs may not be getting extra services in addition to their products is a breakdown in communication.
“People forget to talk to each other and most forget to listen,” says Alan Berkowitz, sales manager, Scrub Inc., Chicago. “People don’t have conversations anymore, but those who do are very successful.”
That breakdown is even more apparent in today’s technology-based society. While communication can be faster thanks to e-mail, it also makes the relationship less personal. What was once done through phone calls or face-to-face meetings is now handled in short bits of text via the computer. Instead of receiving new product brochures in the mail, materials are sent as PDF attachments or links to a Web site. Having conversations with vendors is becoming a thing of the past, and it’s coming at a price.
“We forget to ask about those things that keep us up at 2:00 in the morning,” says Berkowitz.
Without communication, distributors won’t know what services are of value to their customers.
“If you’re not going to ask a distributor what services they offer, you’re not likely going to get any,” says Peduto.
Savvy distributors will be proactive about offering extra services, but realistically, not every vendor takes that approach.
“Distributor salespeople have to guard their time,” says Berkowitz. “To provide value-added services gets in the way of hitting the numbers they have to hit.”
And even the savviest of vendors can lose sight of the proactive approach.
“People get complacent, distributors get complacent,” says Nick Spallone, general manager of Tahoe Supply Co., a distributor in Carson City, Nev. “Distributors can forget and lose appreciation of the business we receive from BSCs.”
Dan Young, president of Summit Building Maintenance in Seattle, is a BSC who has experienced that type of complacent attitude.
“I think I’m low on vendors’ priority lists. I’ll get a call maybe once a year asking if I need help with training or other services,” he says.
Since Young’s real needs aren’t being addressed by his supplier, he has no loyalty towards them and only uses them to obtain products at the lowest price. Even then, there is nothing stopping him from continually shopping elsewhere for a cheaper price, including at his local big box store.
This type of attitude can create a slippery slope. When BSCs only want a low price, that’s all they’re going to get.
“Some customers squeeze us so low that we don’t have the profitability to turn around and take the time to do these extra services,” says Shelley Riha, Northwest region president for Deerfield, Ill.-based AmSan.
But some BSCs caution against making purchasing decisions with too heavy an emphasis on price. Supplies are only a small part of a BSC’s overall business, says Peduto. Labor is the largest cost and the value-adds a supplier can offer can help control that cost, he adds.
Evaluating the relationship
The first step to getting value-added services is to sit down and communicate with vendors.
“Have a conversation with them,” says Berkowitz. “Make sure they take an interest in your business and respond to what you say.”
Then start asking questions. Peduto recommends asking what vendors can do in regards to three specific product categories: chemicals, equipment and consumables (towel, tissue and hand soap).
For chemicals, can the vendor help consolidate them, train employees on proper use, or manage the product inventory?
The key factor to buying equipment from vendors is whether they will service it. Some will only sell the machines, but won’t service or repair them.
Finally, for consumables, it’s important that vendors deliver these products on time since usage can be high. It’s also beneficial to have a wide variety of product choice.
It’s possible that a BSC’s current vendor doesn’t have the answers he or she is looking for. If this is the case, it may be time to start searching for a new supplier to partner with. BSCs need to look for vendors that they can trust to give them the attention their companies deserve.
“You have to ask if this company is going to be right for you,” says Wartgow. “Are you going to get service, or are you going to be a little fish in a big pond?”
When evaluating vendors, look at their company histories, their market stability and their company values. BSCs should choose a vendor that is compatible with their own companies, says Wartgow.
It is important for BSCs to sit down and assess exactly what they want from their distributors. Then, whether they stick with their current supplier, or look for a new one, they will know they made the right decision to obtain the services they need along with their product purchases.
|Talking points |
Distributors do more than just sell products. They educate their customers on how to clean specialty floors, advise them on how to keep worker’s compensation claims down, or monitor product usage at accounts — to name a few.
“Employees don’t have to learn what is red, white and blue at each facility. It’s all constant,” says Riha.
Disclaimer: Please note that Facebook comments are posted through Facebook and cannot be approved, edited or declined by CleanLink.com. The opinions expressed in Facebook comments do not necessarily reflect those of CleanLink.com or its staff. To find out more about Facebook commenting please read the Conversation Guidelines.