New technology drives growth at W.A. Birdsall

BY MARY JO MARTIN

Editorial director

Now in its 95th year of operation, W.A. Birdsall & Company is using new technologies, along with its long-standing customer relationships, to generate growth.

William Adams Birdsall, who had been employed by the Freed Heater Company, a manufacturer of heating boilers and radiation, founded the company in 1911. Its first location was on Mechanic Street in Newark, N.J.  In 1938, Mr. Birdsall moved his business to its present location in Linden, N.J., into a “state-of-the-art” new office and warehouse that had railroad siding and a pipe shed with an overhead electric crane. Birdsall made arrangements to have several manufacturers make products for him to sell under the name WACO, deriving from the company name, but without the “B” because someone else was using WABCO. These products included plumbing fixtures and boilers.

In about 1940, Birdsall fell ill and had to move to Arizona.  He left the business in the hands of others, and it went into a downhill spiral until creditors met to come up with a solution. Three of them -- American Standard, U.S. Radiator Co., and Youngstown Pipe Co.  --   knew of E. Mulford Birdsall, the founder’s son. He was putting himself through college in California by working for a large plumbing contractor. They brought him back to the area and explained the plight of the company, which was, by then, effectively bankrupt. The creditors told him that if he could take over the management of the business himself, they would help him with extended credit terms.  It took some time, but “Mulf” -- determined not to let his father’s name be dragged into bankruptcy -- prevailed and was most successful.

Over the years, W.A. Birdsall’s partners have included Charlie Ashbey, William Ditzel, Herb Braun and Jack Goosetrey. The current partners are Harrison Ball and Jean Ball (daughter of Mulford Birdsall), Thomas Ditzel, Michael Murphy and Mark Premak.

W.A. Birdsall ‘s management recently shared with The Wholesaler the latest information on the company and how it is effectively using technology.  Participating in the interview were vice presidents Thomas Ditzel, Michael Murphy and Mark Premak, along with office manager Laura Fyfe.

Among W.A. Birdsall's team are (from left) partners and vice presidents Mark Premak and Michael Murphy, office manager Laura Fyfe, and partner and vice president Thomas Ditzel.

MJM: Describe the company today, including management team, facilities (existing and planned), customer base, territory, number of employees, product sectors?

Ditzel: The company distributes plumbing, heating and air conditioning supplies to consumers, fuel dealers, utilities, commercial/industrial facilities, HVAC and plumbing contractors. The two locations of Linden and Summit serve the New York City metro area. 

The company’s market position is a full-service provider of high-quality products. That is, offering the most complete inventory, marketing and technical support for today’s most innovative products that offers customers labor savings, energy savings and/or competitive advantage.

We recently added 380 square feet committed to “Live-Fire” training and have committed to building a state-of-the-art showplace and training facility by Spring 2007.

W.A. Birdsall & Company has 22 employees between both locations.

MJM: Are you more involved with residential or commercial/industrial construction? Can you share percentages of sales for those areas, as well as for your product mix?

Premak: The company generates 70% of revenue from heating and air conditioning equipment sales. The remaining 30% of sales are derived from plumbing. Sales are a mix of residential and commercial.

MJM: Are you comfortable discussing annual sales volume, or perhaps percentage of growth in recent years, especially after the implementation of the DDi System?

Murphy: In 2005, W.A. Birdsall demonstrated record sales, an increase of 48.54% over 2002, before DDi’s implementation in July 2003.  This was accomplished without a drastic increase in personnel due to more efficient, streamline procedures, driven by DDi.  In addition to sales growth, W.A. Birdsall was also able to make many improvements to the Linden warehouse.  The main warehouse was reorganized with new shelving to make more efficient use of the space.  Temporary boiler structures with racking were added to both the front of boiler building and the dock between both buildings. This allows us to stock an adequate supply of a full range of boilers during the busiest months of heating season -- a time when our sales can be more than double the slower months. Additionally, the parking lot was reorganized with pipe racks and lined parking spaces for the easy loading and unloading of pipe.

MJM: What are some of your growth projects/goals for the near future?

Ditzel: Our new showroom in Summit is scheduled to open by the end of the year. We have a new branch in Brooklyn and a new showroom in Linden scheduled to open Spring 2007. We are also looking at growth through our new HVAC line, Haier America. An outside salesman has been dedicated to growing the redistribution network, and we also plan to launch a catalog and webpage detailing our products.

MJM: Were you using another software system prior to DDi? If so, what was your reason for wanting to switch to a new system?

Premak: W.A. Birdsall used PDS for approximately eight years for accounts payable, limited accounts receivable (invoice totals only, statements, cash receipts) and limited retrieval of pricing information. The system was not user friendly and only a few people in the offices used this system. It was mostly used after the transaction, not during the customer interaction. Sales orders were handwritten at the counter. The next day a salesman in the office priced them. Then the prices were extended and totaled by a clerk. The sub-total, tax and total were entered into PDS for each customer so that statements could be produced. Merchandise was not received in PDS so there was no accurate record of inventory. Purchasing was all done manually with handwritten purchase orders faxed to the vendors. 

MJM: What was it about DDi System and its key features that interested you?

Murphy: DDi is a thoroughly integrated system from sales to purchasing to accounting and it’s easy to use. Also, Adam Waller’s [founder and president of DDi System] years of experience in the distribution industry gave us a great deal of confidence in the program. DDi offered a lot of functionality at an economical price. 

MJM: How did DDi support you during the purchasing, installation and training process?

Fyfe: All the data was transferred in one day, without any prep work on our part. Two DDi personnel spent a week “tweaking” the integrated data, setting up all hardware and doing one-on-one training. DDi’s support line responds in a very timely manner for ongoing training on DDi functionality and to make changes to the DDi system to meet the needs of W.A. Birdsall. DDi offers training programs both at their facility and online. We have ongoing contact with the management, sales and technical support of DDi to discuss ways to better utilize the system as is, and with new upgrades and modules.

Almost all of the employees use DDi for inside sales, outside sales, counter sales, dispatching, receiving, accounting and purchasing. Even the drivers have “palm pilots” to capture signatures that are uploaded into DDi.

MJM: What are some of the particular areas of the system that you use? Can you please be specific on how you use them and also describe how each of these areas benefits your business, your customers, your vendors and your bottom line?

Fyfe: We use DDi for sales, purchasing (individual & stock orders), receiving inventory and transferring inventory, dispatching deliveries, updating pricing, accounts receivable and collections, accounts payable, general ledger, bank ledger and reconciliations, management reports, etc.

The data captured allows us to manage all areas of the business better. There are a variety of established reports for sales analysis, inventory management, accounts receivable, cash flow analysis, etc. The tools are also available to create reports that are not already established. Yet another example of how highly adaptable the software is to our needs.  We have just purchased Business Intelligence, which will allow us to utilize the extensive data captured by DDi, and manipulate it to analyze trends, strengths and weaknesses.  We look forward to this being an excellent management tool.

W.A. Birdsall buys smarter because it is based on inventory on hand and forecasted sales using actual seasonal history. No longer do we walk up and down the aisles to see what we need and then write it up. A projected purchase order is completed in minutes instead of hours.  We are able to order items that we might have otherwise missed until we lost a sale. Better managing our inventory enables us to provide what our customers need in a timelier manner. We have more of the “right” items in stock. If we do not have something, we know right away so we can make substitutions, transfer from another branch or order from a vendor. 

W.A. Birdsall is more efficient because we can now:

• Create, print and fax both sales and purchasing documents from one document no longer requiring the double entry of products. Not only is time saved, but it reduces the number of errors by eliminating the chance of selling one product and buying a different one, entering incorrect quantities or prices, etc.
• Adapt to customer’s preferred methods of receiving information (mail, fax or e-mail) so customers can streamline their operations. This includes sales orders, invoices and purchase orders and can be done right from the system, eliminating the need to go to another machine to send. Invoices can be automatically faxed or e-mailed which drastically reduces the time spent distributing invoices.
• Send invoices with signatures so customers do not need to call for a signed copy and we do not have to retrieve the signed copy from a file and fax from the fax machine.
• Create automated invoices that allow time to quality check invoices before updating.
• Consolidate the approval of credit cards into the sales process instead of being an office function after the transaction.
• Retrieve information quickly with a variety of search methods. For customer sales, we can search by customer name, purchase order number, job name, ship to information, product purchased. From product analysis, we can easily review open sales orders, open purchase orders and completed transactions for each branch. 

By using price matrixes, W.A. Birdsall has been able to offer more customized price structures based upon both product and customer. As we continue to develop this, we become more competitive while still maximizing revenue.

Price updates are being automated by uploading manufacturers’ file directly into DDi.  This allows a number of products to be entered in a very short time without the chance of typos. We are preparing to implement trade service to fully automate our price updates and produce a catalog and webpage detailing our products.

We are better able to manage our returned goods, ensuring that we create negative purchase orders to send back material for credits or replacement items. Items are being returned in a timely manner now, putting the money back in our pockets.

MJM: Are the benefits/changes to the way you do business visible to customers and vendors, or are they more of an internal means of automation?

Fyfe: The benefits/changes are extremely visible to our customers and vendors. Customers have immediate pricing information, via faxed or e-mailed sales confirmations and invoices that enable them to accurately bill their customers. Customers are serviced quicker. Many questions, such as did their order arrive, can be answered by office and counter personnel so customers do not have to wait for the salesperson that is occupied with another customer. Also, salespeople are e-mailed when special orders arrive so that customers can be notified immediately.  When ordering, customers know immediately if something is in stock and their sales history is accessible for returns, to find past invoices, etc. Vendors receive purchase orders that are easy to read and contain pricing information. Any price discrepancies are detected and resolved before any material is shipped.

MJM: Have you done any upgrades since your initial installation? If so, what all was involved in the upgrade itself and how often do you estimate having to upgrade in the future?

Fyfe: W..A Birdsall is hungry for all upgrades and added functionality. In addition to officially launching upgrades, at no additional cost, DDi also posts interim upgrades weekly, sometimes daily. They are extremely easy to load and W.A. Birdsall looks forward to seeing what features have been enhanced. We load these at least a few times a month. In addition to upgrades, DDi offers added functionality with additional modules. W.A. Birdsall has purchased most of these, including the credit card module, signature capture, ups, e-mail and business intelligence. In the future, we will also purchase bar coding to further streamline our warehouse operations.

MJM: Do you find that you are using a good deal of DDi’s functionality?

Fyfe: We are using most of DDi’s functionality, always looking for more ways to use DDi to run our business better. Currently we are being trained to use auto-branch replenishment to better utilize our inventory between our Linden and Summit branch. We attend the update training sessions yearly to ensure that we are using all new functionality. We encourage DDi to give us more and show us how to use it.

MJM: Are there any areas that you feel the software is lacking or any further developments you’d like to see DDi make that could benefit your business?

Fyfe: There are a few functions, such as critical inventory reports, that provide important data at a company level that we could better utilize at the branch level. Also, if credit card authorization included debit card pin entry, the result would be significant savings in credit card charges. These items are included in our DDI “wish list” and have been communicated to DDi. DDi is receptive to these suggestions and have promised to consider implementing our “wish list” in future upgrades.  Sometimes DDi is able to make small changes immediately at no cost to W.A. Birdsall and we always have the option to customize our programming immediately for a fee. DDi provides their system with a lot of adaptability.  We have really grown with DDi.

MJM: Do you envision that even more of your business will be done electronically down the road?

Fyfe: Yes. We recently implemented the e-mail module, which allows us to e-mail any document including sales order confirmations, customer invoices and purchase orders. We are in the process of adding the option of electronic funds transfer for quicker and more efficient application of payments and to align with the goals of several of our large customers. We can now meet the needs of our technology-savvy customers as well as our old-time contractors.

MJM: How do you balance the wonderful benefits of electronic technologies with continuing to build close relationships with your vendors and customers?

Fyfe: The technology allows us to access and provide information faster, more accurate and more detailed. That made easier, it gives us the time to build rapport with our customers. We have more time to spend providing value added services such as heat loss calculations, technical support and training. When necessary, we even go to job sites to consult on what is needed, resolve issues, etc.

For more information, contact W.A. Birdsall at 908/862-4455 or www.wabirdsall.com; or contact DDi System at 877/599-4334 or www.supplyhousesoftware.com.