“Let me show you our phone system,” Dave Hutchins, CPMR, president of Spec Sales says shortly into our interview, leading me to a small room within his office at the company’s headquarters in Ontario, CA. Spec Sales represents about a dozen manufacturers of plumbing and industrial/mechanical products. It also has satellite locations in San Diego and Las Vegas. “We have a T1 line that is fed by one phone number, and this gives us unlimited incoming and outgoing call capability,” he adds. “As a result, our customers never get a busy signal and always get into our switchboard.”
The notion of someone never getting a busy signal is new to me, and I let Hutchins know this. He smiles and continues to talk a bit more about the company’s phone system, which was set up according to his specifications two years ago when the company moved to this building.
“Our telephone can be plugged into the exact same Cat 5 connection that a computer would be plugged into,” Hutchins explains. “As a result, if we want more phone stations vs. computer stations we can make those adjustments as our business model grows. We’re only limited by how many buttons we choose to put on our phone, and we have more buttons than we need.”
Hutchins says Spec Sales employees try their best to not have a customer call in and get into voice mail, unless the person asks to be put there. “We want each caller to get a live person and get into customer service as soon as possible. We’re a customer-service information business, and if we’re not providing that to people when they call and need it, then we’re not doing our jobs.”
To further ensure customer contact at all times, calls made to the office phone numbers of salespeople are automatically forwarded to their cell phones when they’re out of the office. Hutchins relates a story of how doing this little thing can provide big benefits for both customers and the company.
“Not too long ago, my wife and I were up in Pasadena on a Sunday and an architect had called our office,” he recalls. “He didn’t know me specifically but had gotten our number from our Web site (www.specsales.com). He was doing a design that had to do with drinking fountains. The person listened to the menu and got my name, punched in my extension and I answered my cell phone.
“He wanted information on Haws and some drawings and happened to be in Pasadena. So even though my wife and I were out shopping, I was able to go to his home office and give him a catalog. He was thrilled to death.”
Education, Specification, ParticipationSpec Sales’ customer connection to the plumbing industry often begins via the phone, but it in no way stops there. This is especially true when it comes to serving the plumbing engineer.
The company has three people who work closely with the plumbing engineering community: Kelly Gilfoy, director of sales, 27 years of service; Ludmila Podwell, outside sales, 1 year; and Mark Campbell, outside sales, 24 years. According to Hutchins, Gilfoy spends about 75-80% of his time calling on engineers, architects and municipalities (such as school districts), while Podwell spends all her time working with the engineering community. Campbell probably spends about 30% of his time with mechanical engineers and 70% with contractors/wholesalers. Five additional outside sales people spend the majority of their time calling on contractors/wholesalers.
These three salespeople focus on meeting engineers’ needs in two ways: Providing helpful product and code information; and partnering with them through participation in American Society of Plumbing Engineers activities.
“Long ago, we asked ourselves: How can we represent our manufacturers to the industry better than our competitors do?” says Hutchins “And we decided to do it through education. And the best way to educate is to get one-on-one time with engineers. It’s so important to educate the engineers doing specification work on what the true differences are and explain to them why they should hold spec on a product.”
Each of the “core” manufacturers Spec Sales represents (Haws, T&S Brass, Mifab, Lawler, Hydrotek, IPEX, Crane Plumbing, KBI) has a training class at least once per year, and some have them two or three times per year. Sales and non-sales people from the company attend this training on a regular basis, notes Hutchins. “Some manufacturers even have great training programs online, usually focusing on a specific section of their product line or even codes,” he says. “The attendee goes through the training and then takes a quiz at the end.”
Hutchins acknowledges that nothing replaces the hands-on training one gets at a live training class, but likes the cost savings and flexibility online training offers. This training lets his staff increase and refresh their product knowledge in as little as 30 minutes per day, depending on the course.
A second way that sales people increase their product expertise is through “internal cross-training.” Each member of the sales staff has to provide the rest of the staff a certain amount of training throughout the year, according to Hutchins.
“The person might choose to discuss low-flush toilets or drainage products,” he adds. “It’s that person’s responsibility to learn everything possible about a specific product we represent, including the codes and competition, and then do a PowerPoint training presentation on it. They also get graded by the sales staff on how they did.”
“We think a good rep should be in the mode of learning about things all the time,” says Gilfoy.
To help strengthen the relationship between sales and customer service, Hutchins has instituted internal “team structures.” Under this model, specific sales and customer service staffers are teamed together as a way to (1) better monitor and channel information shared between the office and field and (2) prevent the possibility of manufacturer disinformation being shared with any customer.
Gilfoy, Podwell, and Campbell meet with engineers throughout Southern California and Las Vegas on a regular basis. Most of the time this is done through weekly Lunch & Learn presentations at the engineering firm’s office, although they’ll also team up with experts from a manufacturer they represent and make a technical presentation to a large group of engineers at the Ontario office or a neutral site. Hutchins cites a recent presentation Spec Sales hosted on siphonic drainage in Orange County as an example.
“Lunch and Learn is the path of least resistance to get an audience,” says Gilfoy. “Engineers are so busy that supervisors don’t want them tied up with a vendor for very long. So if we have new products, they require an explanation in order for them to be specified in an engineered application. The best way to do it is to come in during the lunch hour, which doesn’t cut into the productivity of the firm.”
Podwell says Lunch & Learns are great opportunities to answer engineers’ questions and schedule follow-ups with those individuals. She says that Spec Sales is welcomed by engineers because of the relationships established over the past 20+ years. Gilfoy also likes providing the engineers with product samples and cutaways, which help the engineers see for themselves the difference in quality.
Both Gilfoy and Hutchins are members of the ASPE Los Angeles Chapter, while Podwell belongs to the San Diego Chapter. In fact, Gilfoy has been named the associate of the year twice by the LA chapter. All three also participate in activities of the Las Vegas and Orange County Chapters.
Another organization Spec Sales works with, on behalf of their represented manufacturers, is the International Association of Plumbing and Mechanical Officials, which is based in Ontario, just a couple miles away.
Hutchins says Spec Sales helps facilitate the testing and approval of products for many of the manufacturers they represent through IAPMO. “Gilfoy has been our contact person for that and probably has spent more time at IAPMO than all of our manufacturers individually put together on their behalf.”
Another way Spec Sales helps the engineering community is by providing detailed information on how manufacturer products meet current codes or laws, like the Americans With Disabilities Act. For example, they can provide from manufacturers basic rough-in dimensions that show how a product follows the ADA.
“Engineers are like a sponge,” says Campbell. “They want to know what’s new, what’s great and what’s working. We get a lot of one-to-one feedback, including lots of questions regarding codes. They really want to know codes.”
Gilfoy points out that, as of Jan.1, 2008, California has new plumbing, building, mechanical, fire and electrical codes. “This is the first year that the state is allowing CPVC plastic pipe for potable drinking water. We have a lot of engineering people who have never looked at that product for potable drinking water, so their design criteria will change, such as greater expansion and contraction ratio and different pressure ratings.”
Green plumbing is another topic that everyone at Spec Sales must stay informed about, not only because some of their manufacturers make water-conservation products but also because of the engineering community’s desire to learn more.
“Everyone is intensely interested, and the engineering community is spending a lot of time and a lot of work trying to figure out some of these green concepts,” explains Gilfoy. “These include sourcing products that will meet the need for the LEED program and give them the points that they’re looking for, as well as doing calculations for greywater systems, water runoff and capturing and reusing and filtering water. But when the job goes out to bid, the state isn’t really giving you any financial incentive to spend that extra money. So they’re doing the engineering and then it gets value engineered out of the project before the project is built.”
Because it is focused on Southern California, the company will also call on local engineering firms that may do work for national accounts, like AMC Theatres. Hutchins says Spec Sales makes sure these firms are kept up-to-date on manufacturer’s products, even though those specs and that product might be bought out of their territory.
“Engineers need people who are resources,” says Gilfoy. “If a guy’s a CPD or a P.E., he’s already got the knowledge and the experience. But he’s also probably got 27 responsibilities and wears six hats in his firm so he doesn’t have time. So, if I can save him some time then I’m still a useful asset.”
“Often, engineers will ask us what we would recommend for a specific application,” adds Podwell. “I guess that’s the trust issue, too. They know they can trust us when specifying products.”
Business BasicsSpec Sales sells only to the plumbing wholesaler. Hutchins says that about two-thirds of the company revenues stem from the plumbing side, although the industrial/mechanical side is growing. “We’re in the process of growing that side of the business because the plumbing manufacturers we handle also have products that need to be represented to the industrial field.”
The company’s satellite offices in San Diego and Las Vegas have inventory space of 600 to 1,000 square feet, which is managed by the salespeople who work in those locations and serve nearby territories, according to Hutchins. He also is proud of the fact that many companies Spec Sales represents are family-owned, including Mifab, Stiebel, Lawler, Haws, KBI and T&S Brass.
“Everything we represented and promoted used to be on consignment. We initially did no customer billing, and then over the years, brought on by a myriad of reasons, manufacturers have become more interested in allowing reps to be ‘buy-sell.’ Now, probably two-thirds of what we have in our warehouse is buy-sell products and about one-third is actually consigned material where the manufacturer still owns it.”
One of Spec Sales’ company goals is to be in the top one-third of each of their manufacturer’s rep networks. Hutchins says that, in many cases, they are consistently number one in sales or in their top five. This allows them to keep their line card manageable and to grow at a steady and well-organized rate.
Hutchins says the company’s will call business is increasing at the Ontario office, pointing out that many wholesalers and contractors with delivery trucks come by and pick up from there on a daily basis. He says that his salespeople will provide technical help to contractors serviced by their wholesalers, especially the smaller ones who don’t have an outside sales force.
Staff members of Spec Sales have come from both inside and outside the industry, including wholesale. Once he hires an employee, Hutchins believes it’s important to train that person properly and provide incentives to keep him or her happy and not looking for greener pastures.
A few years ago, Hutchins became a Certified Professional Manufacturers Rep after completing a three-year program taught by professors at Arizona State University. This month, both Gilfoy and Podwell will be attending Certified Sales Professional training and be certified after completing the course.
Hutchins took over operations of the company in 1991, and the first thing he did was change the sales staff structure from being geography based to one based on expertise. Before the change, each sales person would call on the engineer, wholesaler and contractor in that territory. He also has placed a strong emphasis on all Spec Sales customer service people being trained as product experts for every manufacturer represented.
Trends & ChallengesThe recent consolidation trend - amongst both the manufacturers Spec Sales represents and wholesalers it supplies - presents the company with a tough challenge: Staying close to both groups and meeting their needs as their expectations change.
“When the business is managed locally, it’s easy for us to manage our dealings through the decision-makers,” says Hutchins. “But when the decision-makers are outside of our territory, we have to rely more on the manufacturers we represent because they have a more national presence and longer reach. The positive of this, though, is that it actually brings us closer to the manufacturer.”
For the most part, Spec Sales uses the standard 30-day contract with its manufacturers, although Hutchins says he has been able to negotiate specialized contracts on occasion. For example, he’s set up contracts with better commissions up front and then they went back to what was considered a normal rate. Also, he’s had contracts with descending commissions where, if the two parties parted company, Spec Sales would get descending commissions for the six months after the breakup.
Everyone at Spec Sales has one goal, says Hutchins: To answer 100% of customer questions and concerns internally. Failure to do so means that they really don’t know enough about the manufacturers’ products they represent.
To help prevent that, Spec Sales has a system method where every customer call is manually entered into a log that every customer service person can access. This lets any customer service person find out the date of the last conversation and what it was about.
“The information age definitely drives people to expect instant response. And the more things we can do information-wise and electronic-wise to provide instant response, the more we’ll definitely re-invest them into our business model as part of the routine.
“We like to be thought of more as educators than a sales company. Even though sales are what we do, customer education and devotion to the market is what we’re about. Sales is what we need to do to pay the bills, but education and market awareness is what we provide to bring you back.”