Bradford White makes greater

commitment to tankless market

BY MARY JO MARTIN
Editorial director

At the recent Omni Spring Conference, Bradford White was one of four new vendors introduced to the group. President and CEO Nicholas J. Giuffre was invited to address the membership during the Opening Session, and with a combination of humor and zeal shared the backstory on Bradford White and its dedication to distribution. He reminded those present of the three founding principals by which Chairman of the Board A. Robert Carnevale led the ESOT to acquire Bradford White in 1992:

• Supporting the American worker manufacturing its products in the U.S.
• Employee ownership to encourage greater pride and loyalty
• Dedication to the trade through wholesale-only distribution.

“We still hold true to those three core values, which continue to resonate with our customers today,” he said. “Every time we go to a meeting like this, or visit with customers out in the field, we are reminded how important these principals are to them. It’s what defines us, and it’s a very comfortable fit for us.”

During a break in the meetings, I sat down with senior vice president-sales and marketing Bruce Carnevale and newly appointed director of specialty sales Carlos Morales to get an update on the direction Bradford White is taking their business — including a renewed focus on tankless water heating.
In addition to their traditional water heating business, today’s Bradford White consists of Bradford White Canada, LAARS Heating Systems and Niles Steel Tank. The latter were very strategic acquisitions that helped Bradford White service their customers with solutions to heat or store water, and also to diversify into the commercial market. These divisions work very synergistically together — in fact, LAARS is Niles Steel Tanks’ biggest customer — but have retained their own sales and marketing teams.

There is a popular saying that “perception is reality,” so I asked Carnevale how he believes that Bradford White is perceived by customers in the marketplace.

“The best answer to that is coming to a meeting like this and hearing from your customers,” he responded. “We walked into the Opening Reception here and it was a little overwhelming — in a good way. All of our customers were coming up and congratulating us on getting into the group. We really have to thank our customers for making that possible; they went to great effort to advocate for us being in Omni. I think it speaks very highly of our relationship that our customers will go to such lengths to support us.”

The Omni Spring Conference provided an ideal opportunity for Bradford White to introduce the newest member of their team, Carlos Morales, to many of their wholesalers. Morales, who has earned high respect from the tankless water heating community thanks to more than a decade as vice president-sales and marketing at Noritz, is looking forward to the opportunities he sees with Bradford White.

“In my previous work, I made it a point to support professional contractors and distribution — a strategy I learned from watching Bradford White,” Morales said. “I had long known of their reputation and admired their success. My skills are in the tankless water heating field and its specialized engineering. Without having the strong commitment to contractors, I don’t think I could have achieved such success at Noritz. I’m looking forward to using those strengths and skill to help Bradford White grow the tankless side of their business.”

In fact, Morales had even approached Carnevale some years ago in an attempt to better understand how Bradford White went to market.

“Carlos had reached out to me to get a better understanding of the strategies behind how we did business exclusively in the wholesale channel,” Carnevale explained. “We were philosophically on same the page, and had a lot of respect for each other and the work we were doing. So when things changed and Carlos became available, I reached out to him to see if there was anything we could do to help. It seemed to make sense to bring on board someone of his capability and who has those entrepreneurial skills.”

As with any company, the internal chemistry between those who work together is crucial. And Bradford White is well known throughout the industry for their genuine, hard-working team; in fact, internal turnover is so low they joke that once someone comes on board they never leave.

“The reaction internally about adding Carlos to our team has been overwhelmingly positive,” said Carnevale. “At Bradford White, we strongly believe it’s more about chemistry and the fit with our team. While education, credentials and experience are important, they are not the deciding factor. Before we hired him, Carlos spent several days with our team members and the team really decided that this guy was a good fit for our company.”

When Morales started marketing tankless products in January 2000, there were no wholesalers in California who even specialized in tankless water heaters. According to Morales, there are now over 400,000 tankless units sold in the U.S. each year — or about 10% of the gas water heater business. He also noted that in the ensuing years, the tankless movement has spread through Texas and the Southeast, and now is gaining momentum in Chicago and the Northeast — areas that he will be strongly focusing on.

The first step is training

Over the years, Bradford White has developed a very thorough training program that involves reps, wholesalers and contractors. In conjunction with this new push into the tankless market, they will be expanding their training program in that arena. Morales will be key in introducing these new technologies to customers and teaching them how to sell, install and service Bradford White’s tankless product offering — which includes both gas and electric tankless models, as well as solar and heat pump options.
“Contractors handle a lot of different products,” said Morales, “and they need to be familiar and comfortable with the features and benefits. In addition, many utilities, gas companies and municipalities are offering incentives, so we need to make sure our customers are fully aware of what incentives are available. It’s our job to help them with training and give them the right tools so they can make the sale.”
Carnevale added, “We’ve seen more changes in the water heater industry in the last 10 years than we’ve seen in previous 50. And I think we’ll see even more changes in the next five. As the market evolves because of both consumer interest and government regulations, we will continue to expand our offerings to meet these demands with further enhanced technologies. Carlos’ role is in some ways tactical to help us be a better supplier to customers with our current products, while also being strategic in overseeing training and helping with product development as we move forward. It’s an exciting time and we’re well positioned.”

Of course, the economy plays a role in how much consumers are willing to invest in upgrading their water heating systems, so that has slightly tempered the growth in the arena in the last few years. However, Carnevale is confident that plateau is only temporary.

“We have seen a pick up in sales of more moderately priced products,” he said. “We’ll see that shift toward some of the emerging technologies as the market improves. We want to provide solutions to our customers at every price point and for applications of all sizes and requirements. While we are launching an increased focus on tankless, we realize it is not right for every application, so we want to provide the widest possible variety of solutions.”

The power of the World Wide Web

“The Internet has been valuable in getting the right information out about tankless technology,” Morales noted. “It has helped encourage many consumers and contractors to look more closely at the technology. I’ve found its been very helpful in building relationships because consumers come to contractors with questions, and contractors help them understand the benefits and whether it is the right choice for their application. This builds trust and helps contractors grow their business.”

And continuing to stay true to their wholesaler-only distribution philosophy, Carnevale was adamant about the role that wholesalers play in Bradford White’s success.

“Wholesalers are very important to our business, and to our push into the tankless market,” he said. “Their role is even more critical going forward. One of the things we are always concerned about when it comes to our product development is how it will affect our wholesalers; we don’t want to overwhelm them by having to inventory too many models, but yet we want to give them the breadth of product they need to service their customers. It’s a fine balance.

“As manufacturers, we also support our wholesalers by working with the gas companies to educate them on the type of incentive that is appropriate for our units, and also let them know which local wholesalers offer our products. This creates opportunities for everyone involved. As we see the market evolving, we don’t see these new products going through the retail channel.”

With the number of vendors and wide variety of tankless water heating options increasing, it will mean that the competition for customers’ attention will be high. However, Carnevale likes to put a very positive spin on it: “I think having more tankless players in the industry will work very positively to increase the interest and education level among contractors, wholesalers and consumers. While the concept is becoming more well known, many people still don’t know how these products work, and the benefits consumers will realize. Bradford White is ready and very actively providing education and training in the tankless category for the benefit of all our partners.”

For additional information, visit www.bradfordwhite.com.