Flexibility And Speed Are SMALL BUSINESS Hallmarks

Flexibility And Speed Are SMALL BUSINESS HallmarksWelding & Gases Today asked distributors of small gases and welding companies (sales less than $10M) spanning the U.S. and Canada to describe the most important advantage associated with being a small distributorship and their answers were unanimous. The small distributor’s number one advantage is….flexibility. Craig Duncan, president of Winfield Iron and Metal (Winfield, KS), describes the region he serves as a rural community of 12,000 people. “While larger competitors have reduced their inventory,” he says, “I’ve made a decision to incur the expense of additional inventory in order to fulfill our customers’ requirements more quickly.” Duncan admits that close proximity to his customers also reduces delivery time.

That same flexibility is cited by Charles Johnston, III, president of Samson Company (Clarksburg, WV), who says, “We choose the products we market as a reflection of our region and our customers’ requirements, which allows for a more concentrated effort.” He points to his ability to know every employee and customer name, capabilities and needs. “This helps me run the business smoother, creating a positive atmosphere for both customers and employees.”

“I’ll find a product line my competitors don’t have because I don’t want to get into a price war. If we’re going to lose a sale, we want to lose a sale because a customer preferred a different brand, not a lower price.”
Donn Lang, President
A-1 Welding Products (Dickinson, ND)



 
“When you call our larger competitors, you typically get an answering machine, rather than a live person, or me, the owner of the company. This helps us to be more sensitive to customers’ needs.”
Dennis Fox, President
Fox Welding Supply (Mequon, WI)



 
“Every employee is empowered to make on-the-spot decisions regarding just about any fact concerning the customer.”
Loren Huber, President
Huber Supply Company,
Inc. (Mason City, IA)
 

Scott Bell, president of American Gases Corp. (Gurnee, IL), cites his company’s ability to react faster as a major advantage when it comes to delivering superior customer service. “As soon as an order is placed, we can be very flexible in getting that customer’s needs taken care of.” Bell points to another advantage of a small company: “I expect employees to do their best, and let them own their jobs.” Bell believes that larger companies, by necessity, tell employees what to do and how to do it, and often spend time having to look over their shoulders.

Norman Strobel, Jr., president of Strobel’s Welding Service (Hornell, NY), agrees that reacting quickly to the customer is vital to his company’s success. “We spend time satisfying each customer by following up on customer service requests and assuring each and every custom-er they are not just a number to us.” While some small company owners point out that wearing a lot of hats is an advantage, Strobel says it’s also a disadvantage. “I have to be a jack of all trades. For example, my company is not large enough to have a separate department for collections, a separate department for marketing, etc. I still have to be involved in everything.”

Robert Holton, president of Superior Welding Supplies (Detroit, MI), can respond more quickly to customer questions and needs, and believes his small company’s delivery service beats a larger company’s. “We warehouse just about everything the big companies do.” Holton points to loyal employees who have been with the company for many years as a strong positive for his small company. “This is not an easy business to learn, and loyal employees have much to offer to the success of a small company.”

There is no doubt that most of GAWDA’s small distributors agree with Nancy Koehler, president of Delta Welders Supply (Brookhaven, MS). Koehler thinks that being a small distributor is more rewarding. “I’m better able to make decisions based on my knowledge of our customers’ needs, and I like being able to do the things that I think are needed for success.” Koehler acknowledges there is not much recruiting and hiring going on. “We’re a small company in a small community, and we work with what we have.”

The number of employees at small companies ranges from 6 to 21. Employees directly reporting to the president range from 1 to 15.

 

Dennis Fox, president, Fox Welding Supply (Mequon, WI), also likes being the one responsible for success, especially when it comes to hiring. “I do the hiring, and I know exactly what I’m looking for. I’m not dependent on anyone else to make that decision, so if it’s the wrong decision or the right one, I live with it. It takes a burden off other people in the company.”

The Art of Delegation
When sitting at the helm of a small company, distributors routinely perform the tasks that are not only time-consuming, but often among those that are the least favorite. Winfield Iron and Metal’s Craig Duncan says, “Purchasing and accounting functions are not only time-consuming, but are the direct opposite of my preferred activity of setting the company’s direction and sharing my vision for the company.”

TOP THREE DUTIES small-company presidents would delegate to someone else, if they could…

    COLLECTIONS
    MARKETING
    INSURANCE

(others include HR, field cylinder control, community involvement, and purchasing/accounting functions because they are “too time-consuming”)

The most important line item on today’s profit and loss report is often insurance. “There are so many variables associated with Workers’ Compensation and health, insurance, automobile and liability insurance,” says Scott Bell. “I would much rather delegate the responsibility of managing our insurance plans to someone else,” he admits.

During the past 18 months, accounts receivables have been wounded, and the least favorite activity amongst GAWDA’s small distributors is collections. Norman Strobel explains: “It’s difficult to find a customer who pays within 30 days. We’re not big enough to have a separate department for collections, and there are times when we must be tough with our customers. That’s all we can do.”

Samson Company’s Charles Johnston agrees, “The responsibility of collections is one of those things that are necessary, but not necessarily pleasant.”

Dennis Fox would delegate the marketing function of Fox Welding Supply. He says, “Promoting our products and keeping our customers informed would provide us with sales firepower commonly associated with larger companies.”

“Human relations and personnel functions are riddled with laws and policies that the average entrepreneur is not equipped to handle. If we were larger, I would delegate those responsibilities in a heartbeat.” says Peter Dowbiggin, president of Dry Ice & Gases Co. (Toronto, ON, Canada).

“Out of necessity, all of our employees wear a number of different hats. Company-wide cross training enables each employee to pick up the ball and go in any direction required.”
Craig Duncan, President
Winfield Iron and Metal, Inc.
(Winfield, KS)



 
“Our employees are expected to perform their jobs without having someone peer over their shoulders.”
Scott Bell, President
American Gases Corp.
(Gurnee, IL)
 

When it comes to delegation, Loren Huber, president of Huber Supply Company (Mason City, IA), is an exception to the rule. A small distributor, only one of his 15 employees, Operations Manager and son, Doug, directly reports to him. Says Huber, “While most of my tasks have been delegated, I still report to my dad who will soon be 87 and remains the company’s chief quarterback.” The average tenure of employees at Huber Supply Company is 14 years, and potential hires are interviewed by the entire staff. Huber points out that this is an important activity, because every employee of Huber Supply Company is empowered to make on-the-spot decisions regarding anything about the customer. “They don’t need to have a committee meeting to make a decision.”

Perhaps after all is said and done, the advantage of being a small distributor is best described by Donn Lang, president, A-1 Welding Products (Dickinson, ND), who says, “Because we are small, we may have more to prove to our customers, and I think, as a small company, we try harder.” Lang says he can be more closely involved with employees, providing greater one-on-one interactions. However, he often asks himself if he is able to provide his employees with the expertise a larger company can give them. “It’s easier for a larger company to bring in speakers for safety meetings, and they can more readily send employees to training schools. And with stores across a large geographic region, the employees of larger companies are probably exposed to a greater variety of situations.”That being said, Lang believes there are customers who specifically choose to support a small gases and welding company because “they want to, rather than bump heads with a major corporation.” He adds, “I think they’re rooting for us.”

Gases and Welding Distributors Association