Name:  Engman-Taylor Company
Location:  Menomonee Falls, Wis.
No. branches:  6
No. employees:  148
Specialty:  Integrated supply
Approx sales:  $75 million
Nominated by:  John Jacobsen, Director, Channel Development, Sandvik Coromant

Distributors that provide managed inventory programs for customers typically focus on low-hanging fruit to generate savings. For example, consolidating purchases among a handful of suppliers results in better price guarantees, and keeping closer tabs on inventory eliminates wasteful overstock. Milwaukee area distributor Engman-Taylor Company believes it is more important to apply expertise in manufacturing, engineering and production processes to achieve meaningful, long-term benefits.

“What sets us apart from other companies doing integrated supply is our focus on cost savings related to manufacturing and production, as opposed to administrative overhead costs,” says Rick Star, president of Engman-Taylor Company in Menomonee Falls, Wis.

Engman-Taylor, a past winner of the Value-Added Partner of the Year Award from the Industrial Supply Manufacturers Association (now the Industrial Supply Association), sends employees to customer locations to perform cost-reduction studies. Since 2000, their efforts have generated over $17.6 million in customer-approved savings.

Star says ETCO usually lowers administrative costs during the first couple of years in a relationship with a customer. In the later years, the focus is almost entirely on manufacturing.

John Jacobsen, director of channel development for Sandvik Coromant, nominated Engman-Taylor for the Most Progressive Distributor Award.

“Engman-Taylor consistently provides value-added services to our mutual customers. From documented cost savings, to comprehensive integration programs, Engman-Taylor works with Sandvik Coromant to help our customers increase productivity and decrease costs,” says Jacobsen.

Name:  Air Fastening Systems
Location:  Aurora, Ill.
No. branches:  1
No. employees:  11
Specialty:  Carpenter contractors
Approx sales:  $5 million
Nominated by:  Jason Westcott, Account Executive, Hitachi Power Tools

One way Air Fastening Systems of Aurora, Ill., sets itself apart from the competition is by becoming known as a source for information, not just a place to buy tools and supplies.

“We’re instrumental in trying to educate the building community on code requirements as well as changes in the fastener industry,” says company president Chuck Strohmaier.

Strohmaier serves on the board of the Residential Production Council and the Residential Construction Employment Council, the liaison between the carpenter’s union and contractors. At the invitation of the City of Chicago, he’s also actively participating in a committee established to investigate the 2004 collapse of a porch that caused the deaths of 13 people. His goal is to make sure contractors understand code requirements, particularly relating to the use of specially coated fasteners needed when working with pressure-treated lumber.

“We’re trying to educate the building community. This puts us in front of potential and existing customers. We want to be known as the supplier that customers can call when they need assurance that they’re going to get the right product for the application,” he says.

Jason Westcott, an account executive with Hitachi Power Tools who nominated Air Fastening Systems for the Most Progressive Distributor Award, says AFS employees pride themselves on providing the essential products and services contractors need on the job site.

“Whether it’s making sure they have a loaner in hand when they pick up tools for repair (so there is no downtime), or making an emergency delivery that same day, AFS does an incredible job making sure the customer is 100 percent satisfied,” Westcott says.

Name:  Machine Tools Supply
Location:  Costa Mesa, Calif.
No. branches:  1
No. employees:  85
Specialty:  Cutting tools, machine shop supplies
Approx sales:  $25 million
Nominated by: Joe Sarkees, National Sales Manager, Niagara Cutter

Long before most of their customers get out of bed in the morning, Machine Tools Supply people and computer systems have been hard at work. Beginning before dawn each day, MTS computers automatically connect with a network of automated inventory storage systems in far-flung manufacturing plants, store rooms and machine shops. The computers analyze inventory levels and send signals to the MTS warehouse, so employees can repackage items in the proper amounts and ready them for delivery to the appropriate customer location.

As a pioneer in point-of-use dispensing systems, MTS utilizes vending machines, cabinets, lockers, robotic tool cribs and other technologies to help customers maintain the optimum levels of production tools and MRO supplies. “When the situation warrants, we try to move the customer from being strictly a bid-and-buy customer to exploring the benefits of using vendor-managed inventory and vending machine programs. The cost savings and efficiencies gained for both sides are significant,” says MTS president George Ponce.

Joe Sarkees, national sales manager for Niagara Cutter, says MTS embraced automated inventory storage systems when other companies still considered them a passing fad.

“Machine Tools Supply seems to be willing to pick up the latest technical tools and innovations. They’re always pushing the latest technologies. They like to show customers a better way to get it done,” he says. A spin-off company created in 1995, AutoCrib Inc., develops inventory control systems that MTS uses to manage perishable and non-perishable tooling, safety supplies, MRO supplies and other indirect materials.

“As the Internet continues to shrink the business world, companies like MTS will become the future of industrial distribution,” adds Steve Pixley, a founder of MTS and now president of AutoCrib Inc. “They continue to focus on streamlining the supply chain and adding value to the products they offer by managing them from point of purchase to point of dispense.”

Name:  Aviation Industrial Supply
Location:  Denver
No. branches:  2
No. employees:  30
Specialty:  Mechanical/electrical contractors
Approx sales:  $6 million
Nominated by: Sean Kenny, National Marketing Group Manager, Milwaukee Electric Tool Corporation

Creativity and hard work can go a long way toward impressing customers and vendor partners. Aviation Industrial Supply of Denver showed both when it geared up for the launch of Milwaukee Electric Tool’s new V28 lithium ion battery-powered tools. The company invited seven of its biggest customers to an invitation-only dinner at a mountainside restaurant that serves wild game and other unique menu items.

“It was a pretty exciting opportunity for them to show their biggest customers an innovative new product, and to give them a chance to place the first orders for a product with limited availability,” says Milwaukee Electric’s Sean Kenny.

The event made customers feel special and demonstrated AIS’s willingness to purchase and promote new products into the marketplace.

“We wanted it to feel exclusive for those customers. It’s an example of how you can do something creative on a small budget,” says Dale Hahs, chief financial officer. He says the company leans heavily on a group of about a dozen key suppliers for scheduling marketing plans, joint sales calls and other activities to generate new sales.

Kenny says AIS deserves recognition as a Most Progressive Distributor because of the company’s willingness to expand beyond its traditional markets in search of new business opportunities.

“They’re expanding their user base constantly, and they’re willing to try new products to do that. Most distributors have a core set of end-users and drive new products to that finite group. Aviation tends to look beyond their traditional customers to expand their user base and get into different types of business.”