Utilizing DDI helps Atlas gain efficiency
BY MARY JO MARTIN
Editorial director
Much has changed since Max Wolf founded Atlas Plumbing Supply on Detroit’s Gratiot Avenue back in 1935. Originally, Wolf was a jobber of supplies who supplied local plumbers.
During the ensuing years, Wolf saw many other plumbing supply houses in his area come and go. However, Atlas prospered thanks in part to growing its product offering along with its customer service and commitment to the community. Atlas covers metro Detroit, concentrating especially on the downtown area.
Wolf’s descendents continue the tradition at Atlas today, serving second-and third-generation customers — plumbing contractors, handymen, consumers, businesses and municipalities. Not only do they provide traditional plumbing supplies, such as piping, valves, fittings and replacement parts, but also a wide variety of antique and hard-to-find items, parts and colors of product. Approximately three-quarters of their sales are for the residential market.
“We have always concentrated on the repair and replacement market, thus when new construction stopped, we did not just stop,” commented president Bill Wolf. “We have had to get a little more creative, and add products to fit our market. We began supplying ice melting products to our commercial customers, and began to stock a knock-down kitchen cabinet that provides good quality at a reasonable price for the people, rehabbing and renting homes. As well, we took this time to adjust to more aggressive pricing. We looked at items that we could make a better purchase on, pass the savings and lower the margins, but our sales started growing.”
In fact, the company’s website proclaims: “Great selection. Excellent service. Fair prices. It’s the way grandpa wanted it and we see no reason to rewrite that history.”
Atlas Plumbing Supply has been in the same location since 1965, aDDIng a 8,500-square-foot warehouse in 1998 and acquiring a neighboring building three years ago that added another 4,000 square feet under roof as well as a large yard. The Wolfs are assisted by five full-time employees — and with its small “family feel,” everyone pitches in where needed. “We can have a salesperson making a delivery or our main delivery man working on the counter when it is busy, for example,” Bill noted.
A key asset to Atlas Plumbing Supply’s business is its use of DDI System software. In this interview with editorial director Mary Jo Martin, vice president Marc Wolf recently shared some insight into the efficiencies they have realized since the conversion.
MJM: Are you comfortable discussing any savings or growth you’ve experienced as a result of implementing your DDI software?
Wolf: It is difficult to put a dollar on the savings. DDI has helped with our efficiency. With DDI, we have been able to convert 75% of our accounts to receive invoices and statements by either fax or e-mail. This has provided us a large savings in postage, and I look to continue growing that number. We have found that our average collections time improved since the customer already has a priced copy when they get in the next morning. DDI has also helped improve our purchasing and inventory levels.
MJM: Were you using another software system previously? If so, what was your reason for wanting to switch to a new system?
Wolf: It began when we wanted to streamline our invoicing (faxing, e-mailing and laser printing). These were all “modules.” Then after being with the old system for only five years, they called and told me that they could not support our old server, and we would have to purchase a new server (only through them). I had a hard time comprehending why a five-year-old Dell server could not be maintained or was in risk of not getting parts. By the time I added up what they wanted for each module and the server, it was time to price a new system.
I had looked at DDI prior to purchasing my old system. I was aware of Adam Waller’s plumbing background and felt it deserved a look. I revisited it, and saw the growth that DDI had realized. I felt that they covered many areas very well. It seemed that not only was the system able to do the accounting and backend, but could also handle the plumbing mind on the front end.
MJM: What was it about the DDI software and its key features that interested you?
Wolf: As small business owners and managers, we must often multitask. In much the same way, the DDI System can multitask, too. For example, I can have multiple sales going, have the product screen up, take a phone call for a/r (and fax a copy of an invoice), and still be in the middle of a purchase order.
As I mentioned earlier, I was looking to improve our back end. DDI integrated sales orders to pos, streamlined our a/r and a/p, provided electronic captured signatures (freeing up our filing task and being able to recall and view an invoice and know who signed it). DDI gives us much better reports. Our past program had codes to run each report, and most reports would not print to the screen. This software gives us the ability to view almost all the reports, with drop down menus and clicks — rather than an abundance of codes you can not remember.
Also, DDI’s quoting, special orders, order tracking and order copying features are all very helpful.
MJM: How did DDI support you during the purchasing, installation and training process?
Wolf: After my second conversation with DDI, they scheduled a webinar to work around my time. And then, after further talks they had a salesperson fly into Detroit to show us the system live in our environment. He took questions and feedback from all of my employees.
DDI gave us the specs for the purchase of hardware and did not lock us into buying their server. They said this is the price for X number of units. It was not a module price on every detail. We had a few options, but the bulk of the system was complete with everything we wanted.
DDI sent a team of two people to implement the change over. They worked remotely with the main office, and by the end of the second day we were live and writing orders. The support crew stayed with us and trained for a few days, and then we had remote and phone contact with the team that was at our location. They knew our information, and were familiar with us, it made the transition that much easier.
MJM: Have you had to use their customer support much over the last few years? If so, how would you rate their level of support?
Wolf: We are in touch with customer support often. Support was a problem on our old system. They had the “pay-for-X-level-support” system and they would prioritize. I am still waiting for a call back from a printing issue I had three years ago. With DDI, their support is excellent. The call back time is almost always less than 30 minutes. They listen to our complaints or recommendations. They have implemented a number of our suggestions in new versions, which are free-of-charge upgrades. DDI seems to look at their customers as a partner, not a pain — at least on the phone it seems that way. They know that we are using the system every day and may see things that they do not.
MJM: Do most of your employees use the software in one way or another?
Wolf: Everybody uses our system. Of course I would like to use more of it, and that is slowly happening. From printing staging labels, to linking a special order to a po, the system can really tie orders together. I like the inter-system e-mail, however only a few of us look at it daily. This function alerts me when items sell below margin, or at a zero price, when an order has faxed or e-mailed.
MJM: What are some particular areas of the system that you use?
Wolf: The pricing functions are very flexible. This has helped us tailor pricing for specific groups of customers, and also for specific customers. This capability has given us consistency in our pricing; we can price one item or line for one customer. I had a customer who wanted us to match a price on a certain item, and he said if we could, he would start buying that item from us. After a salesperson brought this to my attention, we adjusted the system so customer will always get the correct price — no matter who helps him.
We began to push our walk-in cash customers to sign up for a cash account; now we can focus on what they use and help in the pricing, as well as look at their history, and market directly to them. The sales analysis reporting also helps to see where we stand with each customer, and where the focus needs to be.
The a/r side of the system is very easy to use. This has helped us collect faster, invoice faster, track easier and maintain contact with the person paying the bills. I use the note feature and send out friendly reminders that a customer’s account is past due with attached copies. It’s not so difficult to do it weekly when it is just a click and not physically faxing and stapling eight pages.
In today’s challenging economy, DDI has helped us become more efficient. It has given us the tools to keep on track. When I know we have falling margins, I can look and see where we need to improve. The system allows me to see if margins are down and why, And sometimes, it shows that while we may have a lower margin, in the next picture I see an increase in sales dollars and profit dollars, so we may need to accept the lower margin in that area. Most of this information is in charts and yearly comparisons.
MJM: When it comes to inventory management specifically, how does inform help you better determine accurate purchasing based on specific sales trends, and more quickly determine dead stock and slow moving inventory?
Wolf: We did not have good inventory history prior to this system. Now we are developing the data to look at the trends. I almost always click back and forth between a purchase order and the product analysis screen. This has helped me keep a watch on inventory levels and turns. We can make the decision to purchase smaller quantities or perhaps a better buy on faster-turning item. As far slow-moving products, it helps determine what is worth stocking.
MJM: Do you envision that even more of your business will be done electronically in the future?
Wolf: Yes, I see more vendors switching to electronic invoicing. We have started to do efts, I see electronic payments increasing and I would like to push our A/R to develop more paperless users, and possibly electronic transfer payments. I envision having a web-based site for online order entry.
MJM: How do you balance the wonderful benefits of electronic technologies with continuing to build close relationships with your vendors and customers?
Wolf: I try to embrace it. I would like to get to the point where my customers can think of us electronically. Much of what we currently do is face-to-face and hands-on. That is why we have developed the relationships that keep our customers returning. It is difficult to develop a friend online; I try to make a point of returning e-mails as fast as possible, and often turn an online inquiry into a phone or in-person sale. We continue our phone and personal relationships and use technologies to help enforce and enhance the sale. If we continue to build relationships every day with our customers and vendors, we can then use electronic technologies to help us make smarter decisions on how we market and do business.
Visit www.atlasplumbingsupply.com or www.DDIsys.com for more information.