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By Richard Trombly | Industrial Distribution: October 2002 The multifaceted organization: some companies develop the strength to grow in many directions at once Joe Thompson's SUV and office reflect the multitasking
nature of Portland, Ore.-based Intermountain Industrial Supply. He has
too many projects to fit on his desk, so some have taken up an unused
corner of his office. Since there are not enough hours during the workday,
some projects follow him home. Do not mistake this for a clutter, however. It is a benchmark of the high energy level Thompson brings to his work. These neat stacks of papers are eventually acted upon, and there is continual progress to complete new projects. As that happens, the business grows and innovates,
as it has since it was founded in 1980 in a converted carport. Thompson started at Goodall Rubber but went on
to start his own company. He is president of Intermountain and its two
sister companies. Intermountain is a regional distributor of industrial
and hydraulic hose and fittings serving customers in the four Pacific
Northwest states as well as Alaska and Hawaii. Unisource Manufacturing Inc. was founded in 1991
to act as a supplier to distributors of hydraulic and industrial hose
and fittings, expansion joints, flexible metal hose, Teflon hose, and
other specialty items. The company had more than $10 million in 2001 sales
and is still growing. Poly-flow LLC, the other sister company, was formed
to fill a need by manufacturing high quality thermoplastic hose. It is
the most recent addition and is growing rapidly. One common thread shared amongst all of the companies
is a quest for excellence, says Thompson. The companies work with customers
to meet or exceed their expectations. A large part of the business is engineered products.
Thompson says he works closely with manufacturers to develop new products. "The demand for new products is often driven
from the top down when engineers want to make something new," says
Thompson. "We look at what is available in the field and then improve
on it." Making it better He says distributors are in a good position to
find out what products aren't in the market and then capitalize on that.
Making a better product can open the door to a new customer. "Then we come in and show them all the value
we can provide," says Thompson. "We have stringent standards
for our manufacturer partners. Our offering, from a limited number of
top lines, produces a mix of the best quality items." That drive at Intermountain to create better products
was part of the genesis of the other two companies. Another was to keep
growing more than a local distributor could by itself. "We found that we could cover under-served
markets without reinventing the wheel," says general manager Pat
Malone. "Unisource gives us a global reach with our core products." Thompson had already learned much about manufacturing through the large amount of custom fabrication work done at Intermountain as well as working closely with manufacturers to develop new products. He says his background in distribution gave him the ability to efficiently inventory and deliver hose and fittings to Unisource customers. The companies share a large warehouse on the fringes
of Portland's airport, which is in the middle of the city's industrial
quarter. As in other areas, industry in the region is in decline. The region used to be the center of the aluminum manufacturing
industry and home to a strong shipbuilding industry. Many have gone away
and so have the industries that supported them. In addition, The Boeing
Co. is moving much of its operations from Seattle. The "silicon forest"
tech companies around Portland and Seattle are also in a slump. Intermountain's partner companies have met the problem
of a shrinking market by broadening their horizons. Intermountain, however,
is firmly committed to serving those businesses that remain and its survival
is dependent upon making its customers more competitive, says Thompson. Like many distributors, Intermountain doesn't just sell
the product, but rather strives to be a solution provider, says Thompson.
Salesmen discuss reducing overall costs with the company's program called
TCR, for Total Cost Reduction. Thompson says he wants to complement his
customers in as many ways as possible. "We look at relationships with a systems approach,"
says Thompson. "We do whatever makes sense to make both sides more
competitive and profitable." In some cases that means holding stock on consignment,
billing monthly or keeping inventory onsite in a customer's facilities.
It can also mean improving the customer's products, adds Thompson. "We offer them better market features for their
products," says Malone. "It can improve their product and make
sales more successful for them." Malone says in at least one case, a customers became
a market leader and its industry changed its standards to duplicate the
quality and composition of the hose supplied by Intermountain. One customer
that works closely with the company on improving its competitiveness is
pressure washer manufacturer Landa, Inc., in Camas, Wash, "Intermountain carries enough inventory so that
we never run out and they keep a lot of stock in our facility," says
Landa purchasing manager Mike Hoikka. "They keep a person on site
to manage inventory and we can get special hoses made in an hour or so
rather than waiting for an order to be shipped in." He says Intermountain also worked with one of its own
manufacturers to design a superior hose specially for pressure washers.
It was helpful in marketing their product over the competition, adds Hoikka. Portland-based Oregon Steel Works also looks to Intermountain
to provide service and solutions as well as low costs, says melt maintenance
general supervisor Randy Stead. "In one case, the startup of a new piece of equipment
failed when a hose blew off" says Stead. "A salesman was there
to respond immediately with a hose of a new material which got the machine
started quickly and running properly." He admits that solutions haven't always worked out quite so quickly and flawlessly, but he can count on Intermountain to get the solution. The company works well with OSW and provides exemplary service, adds Stead. Sharing the same philosophy Semperit Industrial Products, Inc. is committed to the
industrial distribution channel but seeks to partner only with industry
leaders, says president Manfred Reichel. The Fairlawn, N.J. hose manufacturer
has seen its business with Intermountain grow over their 10-year relationship. "The company is price conscious but it is also efficient
at manufacturing and fabrication of assemblies," says Reichel. "Intermountain's
warehouse and production area are furnished with the latest generation
of equipment which is utilized as efficiently as possible." Intermountain uses the latest machines and technologies
in crimping and fabricating for efficient workflow and low cost, high
quality hose and fittings. Reichel says this is one reason why Intermountain
has been one of the premier suppliers to the very limited and specialized
pressure washer industry. Reichel says the distribution channel works effectively
for Semperit when distributors provide the product as efficiently as Intermountain.
The efficiency and aggressive spirit at Intermountain can be traced to
its president's leadership, he adds. "Intermountain combines a forward thinking company
with aggressive marketing under charismatic leadership," says Reichel.
"This has led to phenomenal growth, making Intermountain one of our
top five distributors." Leadership material Thompson is a master salesman and an effective sales
manager. His energy and vigor are transmitted through the entire organization.
He says he lives by the motto, "Why do it tomorrow when it can be
done today--and you can get it done today." At one time, Thompson could manage every aspect of the
business himself. The company was growing and profitable but Thompson
wanted to ensure its further growth. As the company grew into three multimillion-dollar enterprises,
he realized he needed help, especially with accounting and operations
management, he says. Though the company is essentially a flat organization
with respect to management layers, it now has a general manager and operations
manager. Thompson is still actively in control, but has realized that
he can't do everything himself, he says. "It is challenging but important to find the right
people and be able to delegate," says Thompson. "It is hard
to find a balance, but you have to be able to pass on some authority or
you merely become the process. At the same time, I don't want so much
organization that I lose the heat and urgency to make us succeed." A matter of trust Thompson asks a lot of his employees because the company
reflects his own high level of energy. He says some people simply can't
survive in that environment. Others seem to thrive, however. Many employees have been
with the company since they began working. "Take care of the company and the company
will take care of you," says Thompson. "We follow that by promoting
from within and not laying off good employees, even in an economic downturn." He says the company has a responsibility to the
more than 60 employees involved in all aspects of the three businesses.
Some other companies have lost sight of the fact that a distribution business
is about people and relationships, he says. Without that they become merely
holding companies. "The nature of distribution is that we have
to earn the relationships everyday," says Malone. "It isn't
hard to change distributors." He says the employees go above and beyond the call
of duty because Thompson is a leader and the company follows. The multifaceted
company is a reflection of 60 people sharing a common goal. COMPANY SNAPSHOT
COPYRIGHT 2002 Reed Business Information in association with The Gale Group and LookSmart.
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© Copyright Richard Trombly 2003
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