Does Company Size Really Matter?

Is Bigger Better? Four Distributors Respond.

The Gases and Welding Distributors Association identifies a company’s size by its gross annual sales revenue. A “small” company is defined as one with under 10 million dollars in sales; “medium” is 10-25 million dollars; and a “large” company has revenue over 25 million dollars. The presidents of four different-sized distributorships, based on these definitions, respond to Tom Reilly’s question, posed in his article: “Do small companies fare better than big companies in tough times?” It is important to note that all four of the individuals interviewed considered their companies small and pointed to much larger competitors.

Glenn Bliss, James Colosimo, Emmett Aldredge, Robert Williams

Welding & Gases Today: Does the size of your company really matter?

Robert Williams: I think it does. As a small company, we can react more quickly. We also benefit from being able to interact with each other more frequently. If one of my employees has a suggestion or a topic that needs to be discussed, we don’t have to wait until a committee addresses it.

Glenn Bliss: I agree. As a small company, it is not any one individual’s responsibility to suggest company-wide improvements. A measure of buy-in from all aspects of our business, whether it’s truck drivers or cylinder fillers or warehouse operations, is necessary for us to continually succeed. Our employees realize that their ideas are needed, and that they are a valuable part of General Distributing Company.

Emmett Aldredge: But I don’t think it’s really about size. I think it’s more about company culture than the number of employees working for a company. Our corporate culture at Machine & Welding Supply Co. is that of a family-owned business. The values associated with a family-owned business are very important. We never forget that we are all in this together.

James Colosimo: As a medium-sized company, we have many of the advantages that are typical of smaller and larger companies. Like a small company, we can be decisive, innovative and move quickly to create improvements. Similar to a larger company, we are able to attract manufacturers of product interested in the potential volume we can generate on their behalf. On the other hand, because we represent more than one manufacturer for a particular product, I can substitute one manufacturer’s product for another if it benefits my customer.



W&GT: Does the size of your company impact your ability to create change or innovations?

James Colosimo: The caliber of people working for Michigan Arc Products has supported our efforts to be innovative. A smaller company would not necessarily employ the technical people that we have on staff.

Glenn Bliss: I think being nimble is absolutely critical.

Emmett Aldredge: Innovation is not about size. It is about people and company culture, but it can be harder to move a larger company when it comes to innovation. We must work harder to maintain those important personal relationships within the company. Sometimes it’s harder to form a consensus. But I still go back to what I said before, I think it’s really about culture and values, and size is not necessarily the determinant on those things.

Glenn Bliss: As a small company, we are quick to react to the needs of our customers. We respond to customer requests immediately and try to think outside the box a little bit. Whether it’s in the middle of the night or after hours or whenever the time may be, we will do everything we possibly can to immediately respond to our customers.

Emmett Aldredge: On the positive side, a larger company has more likelihood of having had success stories within the company, which will motivate others to think about change.



W&GT: When it comes to weathering the ups and downs of the economy, does company size matter?

Robert Williams: During tough times, smaller companies are more fortunate. We are not loaded down with debt. We can cut expenses more easily simply by my making a decision to tighten our expenses.

Emmett Aldredge: Having multiple locations can be an advantage during down times because some locations may be softer than others. Whereas for a smaller company serving one specific region, it can be feast or famine. As a larger company with a more diversified product line, we have a strategic advantage.



W&GT: Sometimes our very size can present the greatest challenge to our success.

Robert Williams: Being a small business can be a disadvantage when it comes to health insurance costs. Health insurance is one of our biggest line items at Williams Wesco. If we were larger, we would consider self-insurance.

James Colosimo: One of the disadvantages of being a smaller or mid-sized company is the risk of liability. We’re probably not as well-insulated as a much larger company would be.

Robert Williams: Purchasing products from our suppliers and reaping the advantages of volume discounts would be a given if we were purchasing for eight or ten stores. There are some companies I’ve had to quit buying from, because I couldn’t meet their minimum orders.

James Colosimo: We sometimes have a harder time attracting younger employees who are looking for a more corporate environment. Fortunately, three or four jobs down the road they start to realize they may be more secure with a smaller or medium-sized company.

Glenn Bliss: At General Distributing Company, a small number of people wear many hats. Sometimes I wish that we had an IT department. If, for example, we want to redesign our website, a team of individuals from various departments will meet and pool their ideas and knowledge.



W&GT: When it comes to recruiting, hiring and retaining employees, what are your advantages?

Glenn Bliss: I typically focus on our company’s strengths and our history. We’re a third-generation, family-owned company.

Robert Williams: The work environment of a small company is very important when it comes to maintaining low turnover. We are more like a family.

Glenn Bliss: We attract the individual who wants to come to work here, who wants to make a positive difference. In a larger company, it is easier for a non-performer to hide. If a company is as small as we are, every person counts.

Emmett Aldredge: I think that Machine & Welding Supply Co. is large enough to attract talented people, but small enough for them to feel comfortable working for us.



W&GT: What characteristics do you look for?

Glenn Bliss: I surround myself with a core nucleus of key managers who are smarter than I am in their areas of specific expertise. They, in turn, will use the same hiring practice as they fill key positions within their departments. They look for energetic, enthusiastic people with positive attitudes and a can-do ability. We like to hire self-starters, motivated, enthusiastic individuals who thrive on making a difference within a smaller company.



W&GT: Are there any advantages related to size when it comes to your relationship with a bank?

Robert Williams: We’ve been with the same bank for 38 years. Over the years, the relationships have become more personal.

Glenn Bliss: The quality of one’s balance sheet is the critical factor. We have had a relationship with our bank for about 10 years.

James Colosimo: It’s not just the company’s financials, banks also care about the stability of the individuals who own the company.

Emmett Aldredge: While it’s easier for us now than it was when we were smaller, I believe that the company’s financial condition and your bank’s confidence are the most important factors.



W&GT: How does size impact relationships with your customers?

Robert Williams: We have been doing business with some of our customers since 1965. My customers and I know each other on a first-name basis. I often answer the phone, and I am accessible to them.

GAWDA identifies a company’s size by its gross annual sales revenue. This article uses the following definition: A “small” company is identified as one with under 10 million dollars in gross annual sales revenue (480 distributorships); “mid-sized” is 10-25 million dollars (56 distributorships) and a “large” company has revenue over 25 million dollars (29 distributorships).
     
General Distributing Company
Great Falls, MT
Glenn Bliss, President
Employees: 44
Branch Locations: 5
Williams Wesco, Inc.
Gibsonia, PA
Robert Williams, President
Employees: 4
Branch Locations: 2
Michigan Arc Products
Troy, MI
James Colosimo, President
Employees: 32
Branch Locations: 2
Machine & Welding Supply Company
Dunn, NC
Emmett Aldredge, Jr., President & CEO
Employees: 200
Branch Locations: 20
 


W&GT: How many direct reports do you have?

Robert Williams: Four

Glenn Bliss: Nine

James Colosimo: Ten

Emmett Aldredge: Three



W&GT: As a small company, do you ever have a hard time seeing the forest for the trees?

Glenn Bliss: At times, we certainly have a tendency to get bogged down on details and forget the big picture objectives. I find myself telling our people to “just do it” instead of talking about the issues for too long a period of time.

W&GT: If you were a large company, what tasks would you delegate?

Robert Williams: I do the purchasing. I manage accounts receivables and payables. If we were larger, I would delegate some of the routine tasks, including the management of accounts receivables and payables, and purchasing.

Glenn Bliss: I am striving to delegate more inventory management, accounts receivables, accounts payables and sales management functions. It’s not that others cannot manage these departments, it’s just hard for me to let go.



W&GT: What types of responsibilities absolutely require your hands-on attention and cannot be delegated?

James Colosimo: The decision-making process that relates to company expenditures and improvements. I also make the direct decisions relating to sales and which product lines we pick up or don’t pick up.

Emmett Aldredge: The finances of the company and making decisions about the general strategic direction we’re going to follow are important for me to manage.



W&GT: As a large company, do you ever feel isolated from the nuts and bolts of the company?

Emmett Aldredge: I don’t think there’s any question that there is a tendency to get a little more isolated as the company gets larger. We have to work harder to stay in touch with our employees, but I also think that there may actually be an advantage to getting away from the nuts and bolts. My being more removed provides others with an opportunity to thrive and shine.



W&GT: Do you have an ace in the hole when it comes to remaining competitive?

Robert Williams: As smaller companies become acquired by larger companies, key individuals who really know the business and the industry do not remain on the job. The guy who grew up in our industry and really understands it is now selling the company and retiring. His wealth of knowledge and experience is disappearing. I can gain market share at the expense of that larger company that has size but does not necessarily have in-depth industry knowledge.

Glenn Bliss: Our corporate culture and the emphasis we place on training are crucial to our success.

Emmett Aldredge: Our people and our ability to think and act as a small company. As a private, family business, we can think long term, but also act with boldness and speed. Management’s challenge is to make certain we do just that.

Glenn Bliss: We stress self-respect, holding ourselves accountable for results, teamwork, operating efficiencies, and profit sharing. One way to get ahead in any industry is to have an unwavering commitment and belief in your employees, and one of the things I’m hoping sets us apart is the people we have working here.

James Colosimo: We have the ability to react to our customers’ needs both from a technical service point and from a supply point. We don’t have a lot of branches because we follow our customer base. If we have a big customer in a particular area, we will establish a local warehouse to support their gases and welding needs. If the customer moves, we will follow him. 

Gases and Welding Distributors Association