Service and availability key to success for The Distribution Point
BY MARY JO MARTIN
Editorial director
His 10+ years on the management team at Fort Worth, Texas-based Morrison Supply provided Ranson Roussel with extensive experience and knowledge of the plumbing distribution industry. From that vantage point, Roussel quickly recognized the tremendous opportunity to enter master distribution as Home Depot announced its purchase of yow in 2001. The Distribution Point was formed by Roussel and a team of inventors, as an independent U.S. master distributor with the primary focus of supplying the wholesale plumbing community.
Based in Moody, Ala., The Distribution Point stocks 21 vendors, including Kohler, American Standard, and Toto, and supplies 3,000 customers from its call center and warehouse operations.
“We work very hard on developing strong relationships with our vendors as understanding product (new and existing) and the supply chain is crucial for a master distributor,” Roussel noted. “These partnerships are key for our overall success and growth rate.
“Basically, the lines we carry are based on our customer demand. We track and monitor all lost sales and once a pre-determined threshhold is hit, we then begin the process of adding a line, product grouping, sku, etc. The analysis of our customers’ demand is the biggest indicator in this process — we always want to have ample supply in stock to meet their needs.”
Currently, tdp is primarily focused on residential product, but they do service commercial orders. Strong in customer service, Roussel noted that they are capable of working with customers on job quotes, and are constantly looking for opportunities to grow and expand their customer base.
The Distribution Point’s 35 employees are led by a management team that includes:
- President Ranson Roussel
- Vice president-operations Rusty Baker
- Director of marketing Mollie Donohue
- Director of purchasing Barbara Quinn
- Director of inside sales Joan Wood.
“The leadership headed by Ranson Roussel is extraordinary,” said Donohue. “ He applies an open door policy along with an approach of ‘asking for forgiveness rather than permission.’ He employs smart, ambitious and outgoing individuals and provides them the framework to grow and expand their wings, allowing them the ability to make decisions on their own. He pushes us all to strive to give him 100% every day. I have found it rare not to have a ‘micro-manager’ as a boss — but Ranson’s philosophy is one that empowers his employees through decision-making and team-building exercises. It really adds to the success of the organization as it challenges us all to ‘think’ and think outside the box. This, coupled with the incredible atmosphere he has created, makes coming to work incredibly enjoyable.”
Roussel also stresses employee training — especially for tdp’s customer service reps - to ensure that they are able to best serve customers and answer questions that might arise. Tdp currently has one outside sales rep who calls on customers, but the majority of its sales are provided through its inside customer service representatives.
“Our csrs continually receive training and product reviews from our vendors.” Roussel noted. “Technical knowledge is not as important for a master distributor as cross selling and product substitutions. For the most part, when a customer calls, they are in search of a particular product. As a result, our sales staff is challenged with recommending additional products the customer might not have considered, or recommending an alternative product if needed.”
Roussel’s background at Morrison allowed him to “walk in his customers’ shoes,” so he can strongly identify with their needs. This has given him a unique perspective on recruiting new business and building strong relationships with customers.
“In comparison to traditional wholesaling firms, we have more of an opportunity to develop strong relationships with our customers due to the frequency of calls and the amount of repetitive business we strive to capture,” he explained. “Many of our csrs have developed a strong rapport with their customers as they are speaking to them several times a week. I would say the biggest difference between our business and a typical wholesaler is the frequency of the calls verses the frequency of visits a customer makes to a showroom. Our csrs have the opportunity to speak to the same showroom representative multiple times a week — which is why relationship building is so key to our business model. Our csrs work very hard at forming relationships with our customers and want to ensure that they are meeting all of their needs.”
According to Donohue, The Distribution Point has found that the best ways to market itself and target new business is through advertising in national industry publications such as The Wholesaler, along with putting together direct mail pieces and e-mail campaigns. In addition, tdp relies on referrals from its customers and vendors, which is why service is such a key element of their business.
To streamline the ordering process both for tdp and its channel partners, they have invested in a new mainframe computer system, and when launched summer of 2009 will be capable of edi. However, Roussel noted that at this time, “we are not yet convinced that online ordering will aid in the facilitation of the timeliness of an order. This is a function that we are monitoring closely and if we believe it would be of greater benefit to our customers, we will implement it.”
“Our csrs can process an order in less than two minutes — from the start to the end of a call. When analyzing the time it would take to access an online site, search through the thousands of skus available and place an order, the time needed would more than exceed our two-minute call time. We are constantly looking for new and innovative ways to expedite our ordering process, but want to ensure that at the end of the day, it will benefit the service capabilities offered to our customers.”
The traffic on tdp’s website has been consistently strong and the company continually updates its home page as a way to promote its vendors and their products. They have also experimented with some exclusive offers through the website. Currently, they are running a Panasonic promotion of a free WhisperGreen™ display and product training with the purchase of any four WhisperGreen or WhisperGreen-Lite™ ventilation fans (see www.thedistributionpoint.com for details).
Product availability and shipping reliability are key to any master distributor’s success. It becomes a delicate balancing act to ensure the right amount and type of inventory to keep on hand, without tying up too much cash in product that might not turn quickly.
“We closely monitor demand rates and lost opportunities,” Roussel explained. “We continually monitor vendor led times, fill rates and supply chain issues. We want to ensure we have a large depth of skus, but we also have to ensure we are turning product and not becoming overstocked by items that will just gather dust. It basically comes down to a team of individuals who continually analyze and monitor our inventory, constantly making additions and deletions and adjusting quantity on hand. It is an on-going process that is continually tweaked and re-defined.”
It is also critical that tdp can ship product in the most economical way possible to keep costs down, while still ensuring accurate and timely delivery. There are 15 full-time warehouse employees who are strategically segmented into receiving, shipping and stocking.
“Shipping is, of course, a cornerstone to our business model,” Roussel noted. “We ship all orders same day to ensure that our customers receive their product not only as quickly but as cost effectively as possible. We have developed great relationships with our carriers and shipping providers, and they perform outstanding services for us.
“Our warehouse is a well-oiled machine and are staff is cross-trained so that individuals can shift on an as-needed basis if demand is stemming from one particular area. These guys are incredibly efficient. They are the ones who are owed the credit for our same-day shipping guarantee as they are the members of our team who ensure this happens.”
As the number of master distributors grows and the market becomes more competitive, it is crucial for any company to stand out. The Distribution Point does this through their outstanding service record, of which Roussel is exceedingly proud.
“Service is our biggest competitive advantage, coupled with being an independent distributor,” he said. “By not being tied to a Big Box retailer, we are not positioned to compete with our customer base. We also constantly monitor our call volumes and rates as we want to ensure zero hold times and the guarantee that a customer will speak to a live person without phone menus, hold times or transfers.”
In that vein, Roussel noted that he has seen some changes in customers’ expectations during his years in the industry, and is always looking for ways for The Distribution Point to adapt to those changing needs and wants. But currently, his customers’ biggest concerns revolve around surviving the downturn in construction.
“The biggest changes we are seeing right now are stemming from the state of the economy,” Roussel noted. “As wholesalers are looking to refine inventories and run as lean as possible, we are finding the items we need to have in stock are shifting a bit. We are constantly analyzing our inventory and customers’ demands as we want to ensure that we can support the wholesale community with the products moving in the market place.
“A master distributor runs counter-cyclical to the economy. When the housing market is booming, our support comes in the form of special orders, hard to find skus and high-dollar items, which are costly to stock. As the economy downtrends, we are finding that our inventory is changing, and we are stocking more of the day-in-day-out items. By having large quantities of these items on hand, we enable our customers to still supply and sell their basics while alleviating and reducing their own inventory spending.”
For additional information, visit www.thedistributionpoint.com.