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Trade Shows and Table Tops
Regional fastener associations always face the challenge of getting distributors to show up at their trade shows and table tops. Some have had good success. The Mid West Fastener Association usually has well attended events and partly that is due to Chicago being a large and great fastener town. Lots of fastener companies there. The North Coast Fastener Association has found great success holding their annual Distributor Social where distributors are invited to attend for free. I have not been to other regional shows this year and would be happy to hear how the SEFA or Mid-Atlantic or New England shows went. There are plenty of good regional groups out there and they are all looking for the magic formula to conduct well attended events and trade shows.
There is a lot of discussion on how these organizations can work together to do things that they might not be able to do individually. The recent Nucor tour with MWFA, NCFA and NFDA was a great example of regional groups working together on a program. But, there is a lot more that could be done. For example, each of the individual regional groups could get an economist to speak at one of their meetings. But, what if they worked collectively and sponsored a speaker in conjunction with the Vegas show? Could they bring in a Warren Buffet or some other renowned speaker? I know that the NFDA is having an economist speak at their meeting in Chicago during the Fastener Tech week. From what I have heard, this speaker has been right on target with other forecasts he has offered. The NFDA has the resources to bring in a speaker like that but I doubt SEFA or the NCFA do. So, what if they pool their resources and get a really high quality speaker? And none of these groups has really utilized video conferencing yet to do joint meeting that include people from throughout the country. There are lots of opportunities for the regional groups to work together and with attractive programs they should be able to better attract everyone from the fastener industry - suppliers and distributors.
All American Show - next time in Nashville
But, that show is behind me now and the next one I am looking forward to will be Fastener Tech '13 in Chicago in June. More about this show will be coming soon but Chicago is a great fastener town and because there are so many fastener suppliers and distributors there, the show is always well attended. In fact, this is the show that has the best potential to be the fastener show of the eastern part of the U.S. Certainly you can look on the MWFA site to get more details on the show dates and hotels. One thing I'd like to mention is a possible meeting place for show attendees. You know, a place nearby where people can congregate after show hours or after they go to dinner. I've been told that the Toby Keith bar right in the show area is larger than the one in Vegas and would be a natural place for fun loving fastener type people to hang out. So, let's get the ball rolling. If you are coming to Fastener Tech '13, make sure to wander over to Toby Keith's after the show. Let's see if we can get a gathering like we had at the Bourbon Room in Vegas.
We have gone a few weeks without any mergers and acquisitions which is kind of good because it seemed like that was happening week after week. So far this year, what I hear about the fastener market goes something like this:
January & February were strong. March kind of slowed down but some time in mid-April business seems to have picked up again. It is still early in May but we'll let you know what we hear out in the field as this month rolls along. I think it will once again we a roller coaster through the summer and maybe pick up more later in the fall. Just what I'm hearing and reading.
Looking forward to a presentation on 3D printing that I understand will be part of a presentation by Eric Dudas of Fully Threaded Radio. Even my kids heard about the gun being made on a 3D printer so it is in the mainstream news. The possibility of producing prototype parts for the fastener industry has caused many people to become interested in 3D printing so it should be a very interesting presentation. Again, go to the Mid-West Fastener Association website to get more info on this and the entire show.
Next, the All American Fastener Show
Next week is the All American Fastener Show in Kansas City. This will be the first year at this new venue and I'm looking forward to the show. Like the NCFA Social, the trade show is not just about visiting with distributor customers but also about networking with the other suppliers. Strong relationships with other suppliers can often lead to business opportunities either directly (supplier to supplier) or indirectly (sharing market information about new or mutual customers). So, I'm jotting down a few quick notes before I have to go catch a plane to KC. I am managing to make a few stops in the area that I might otherwise not make if I were not in the area. Might as well work what you can, true?
Got a note from a high school friend. We worked on our school newspaper together and lots of other mischief. I had sent him something that I thought might actually have led us to realize we were distantly related but he adamately denied the connection and I totally can respect that. His last note included, "I hope you put your writing skills to good use now and then; although, I do consider an e-mail to me to be good use." Well, I'm not sure this site is a "good use" but I guess my old journalism teacher would be proud. Or, maybe not. See you in KC.
Nucor Tour
Just a quick note here regarding the Nucor Tour with the MWFA, NCFA and NFDA. The tour was terrific and the people at Nucor were wonderful hosts. It is a very impressive manufacturing plant and Nucor product is all over the bridges, stadiums, vehicles, etc. that each of us use every day. The Auburn Cord Duesenburg Museum was also very cool Even more so than I was expecting. The cars in the museum were spectacular.
Needless to say, when you get over 75 people from the fastener industry to "road trip" to a common site, you can guess there will be some networking. The evening dinner at the museum and the cocktails afterwards were fun and the networking was as good as any that goes on at any of the trade shows. Great group of attendees.
Now, this week, I will be attending the North Coast Fastener Association Distributor Social in Cleveland, Ohio. I understand at this point there about 200 people signed up to attend. And, Lisa Graham of the NCFA assures me that there will be quite a few last minute sign ups. The event takes place on Thursday, May 2, so there is still time to sign up and join us at this event. Hope to see you there.
Then, it will be off to the All American Fastener Show in Kansas City. I will try to check in after each of these events. Thanks to Bob Fawcett (who acted as the coordinator with NCFA, MWFA and NFDA) and everyone at Nucor for a great tour.
Fastener Industry Activities in High Gear
The next week is the North Coast Fastener Distributor Social. I have been to each of the first four and they get better and better each year. Looking forward to the panel discussion before the Social which will be moderated by Fully Threaded Radio's Eric Dudas. On the panel will be Simmi Sakhuja, Bob Fawcett, Don Shan, Dan Zehnder and Steve Andrasik. I'm not sure I need to say what companies they are from because that is a group of well known, fastener industry big-hitters. If you don't know where they are from then maybe you need to pay more attention to your industry.
The week following that is the return of the All American Fastener Show, located this time in Kansas City. Heidi Voltrauer did a very nice job with the show when it was in Branson and I am looking forward to the new venue.
In between all that, I've got a couple local "table top shows" being sponsored by customers of mine. Fortunately, I have been invited to participate and that is always a good way to support good customers and learn a little more about where your products are ending up.
Lots of networking and lots of opportunities to catch up with industry peers. I always like to compare notes with other people from other areas to see how they are viewing the fastener marketplace. Also, it's always good to pick the brain of those people who are doing good things. I thought the beginning of the year was pretty strong but a number of people seem to be a bit slower in March. Not everyone and it was not anything dramatic. Things just seemed to be a little bit more sluggish. Sometimes that can be people just stopping to take a breath. Some might suggest that it is just political and economic uncertainty catching up to us. As always, when things are not happening, MAKE SOMETHING HAPPEN. Do something!! Call somebody, send something, attend some show, get on Twitter, find a new customer or product line, join STAFDA, join an industry organization, join a local business group where you live, search on line for a new prospect, just DO SOMETHING. Just this week I spoke to a sales manager for a particular customer and I asked how things were going. He responded immediately, "We're flat. Sales are flat, nothing's really happening. We've been flat all year. Business just seems to be weak. We need to find our next big opportunity." My first response was to think that this person better start updating his resume. I got the distinct feeling that if he told me business was weak it somehow relieved him of his responsibility (as sales manager) to make something happen. But, for every person sitting still in their office blaming the economy, the sequester, Obamacare, young people, whatever...there are others taking a new and different approach. And, that is why it is not all bad news out there. It is a mix and some are up and some are down. Don't let lethargy be the reason your company's sales are down.
If you read this site, chances are I will see you at a show sometime soon. Looking forward to it.
Fastener Industry Mergers Continue
They are coming fast and furious. I just wrote how the Elgin Fastener Group had acquired Telefast in my last post. Went on vacation for a week (spring break!) and come back to read that Elgin has also acquired Vegas Fasteners. After I got over my initial "WOW" experience, I could not help but ask, where is all their money coming from. And, it did not take too much effort to find that Elgin is owned by Audax. You can google the company and read more but here is little bit of what is on their web site:
Audax Group is a premier investor in middle market companies. Established in 1999, Audax manages over $5.0 billion of capital through its private equity, mezzanine debt, and senior secured debt funds. Audax focuses on building companies with leading market positions and superior management teams.
Our mission is to partner with management to build long term value in our companies. Our track record demonstrates we are results oriented business and financial partners. We have a long and successful history of investing across a wide range of industries and transactions, including leveraged buyouts and recapitalizations, corporate divestitures spin-offs and roll-outs.
Audax Group employs over 70 investment professionals in Boston and New York.
Then, I scrolled down to find out more about WHO is the Audax group and I found the following info:
Audax Group was established in 1999 by its Co-Chief Executive Officers, Geoffrey S. Rehnert and Marc B. Wolpow. Previously, Mr. Rehnert and Mr. Wolpow were Managing Directors at Bain Capital where they helped initiate the firm’s buyout and debt businesses. They founded Audax Group with the vision of building the leading investment platform to compete in the highly fragmented small cap and lower-middle market.
So, now the Elgin Fastener Group owns nine fastener related companies: Ohio Rod Products, Leland Powell Fasteners, Chandler Products, Silo Fasteners, Landreth Fastener, Quality Bolt & Screw, Northern Wire, Telefast Industries, and Vegas Fastener Manufacturing; plus Best Metal Finishing. That is some powerful manufacturing capabilities all tied up in one holding company or fastener group.
There are still so many "mom & pop" fastener companies out there it is somewhat shocking when an outside investment group comes in and starts to swallow up several of them. It does, and will, change the industry landscape. Unlike some acquisitions, these all appear to be domestic manufacturing companies that are part of Elgin's group. Imagine if Elgin were sold to another concern, not domestically based. There is a whole lot of domestic fastener manufacturing firepower that could be gobbled up in one helping should Audax ever divest itself of that division. Those are a lot of family run or individually owned and operated fastener operations that just disappear or are melted into a larger concern. But, removing all the fastener sentimentality, that is a powerful group of fastener manufacturers and one cannot argue that those are some solid acquisitions to gather up into one big manufacturing conglomerate.
If I were ambitious, I could try to do the same thing. First, I'd make a bid to acquire Fully Threaded Radio. Then maybe I'd make an offer for Fastener Technology and LINK and American Fastener Journal. Before you know it, I'd swallow up the Vegas Fastener Show and re-name it, "The Traveling Salesman's Vegas Fastener Extravaganza and Beer Tasting Exhibit", featuring Old Rusty Bolt , of course. I'd like to sit here and do some strategic planning but it is 65 degrees out and you should see the to-do list I have looking me in the face. So, my plans for fastener media domination will just have to wait another day. Just because I'm not involved in any mergers and acquisitions does not mean that I think that we are done with these. My guess is I will be writing about these all the way up to the Vegas show. But, enough for now. Time to go enjoy my first taste of Midwest spring.
Now for the Supplier Mergers!
As the article notes, the acquisition of Telefast falls right in line with Elgin's other domestic manufacturing facilities and is a good fit for overall strategy. I had the opportunity to tour Telefast a couple years ago and thought it was an impressive operation. I believe it was still a family run operation and I guess that's now one more fastener industry family business to cash in and move on. I really do not know the details of the sale or even a lot of details regarding the company but I will share here what I was able to read on the Telefast web page:
Founded in 1986 by Jeff and Kathleen Ferry, Telefast Industries, Inc. has grown from a one machine, five employee company to more than 60 machines and 50 employees. In 1907, Jeff's great grandfather, Thomas Ferry, pioneered the cold forming process and began the Ferry Cap & Set Screw Company located in Cleveland, OH. Thomas' son Edward William Ferry established E.W. Ferry Products in 1935. This company was the first in the world to head stainless steel screws. Kathleen's grandfather, John. C. Wasmer, founded Wasmer Bolt and Nut in 1927 and Lake Erie Screw Corporation in 1946.
Following the untimely death of Jeff Ferry in 2002, Jeff Hepner, former Vice President of Sales for Lake Erie Screw, with 30 years experience in the fastener industry, joined Telefast Industries as President. Leo McNeely, former Operations Manager of Cuyahoga Bolt and Screw, was also brought into Telefast as its Operations Manager. In 2007, George Wasmer, former president of Lake Erie Screw Corporation, became an active investor in the company. Telefast Industries' management team is unrivaled in the fastener industry.
That's a lot of fastener industry history. I hate to see that kind of history just go away but it has happened before and will likely happen again. The way the fastener mergers and acquisitions have been going over the last six months or so we might see something like this happen again a lot sooner than we all think!
Fastener Talk,... kinda
Doesn't sound horrible. But, there have got to be numerous defense contractors and other companies dependent upon government spending that are or will be hurting and I know this must affect many of our fastener industry brethren. Then I look at the stock market and I see it has been going up week after week after week. My daughter is in her early twenties and while discussing the economy recently she asked/stated , "..but isn't the economy really bad right now?"
What do I tell her? It's so complicated I find it hard to sort out. The Fastener Distributor Index (FDI) went down again in February after having spiked up in January after having dipped in December. And that is kind of what I hear in the fastener distributor market. For the most part, I have been finding things to be pretty good so far this year but I do have some distributors I call on that are not doing so well or they are just flat. It is a real mix out there. If housing is recovering, that's good for somebody. If auto sales remain strong, that's good for somebody. But, I will tell you what is bad for everybody...and it is stated in another line from the Kiplinger Letter: "Looking ahead to 2014...more of the same: A government limping from crisis to crisis and an economy hampered by Washington's dithering, but still growing".
I don't know the average age of the person who reads this site. My guess is that the people who read this have been in the industry a while so I would guess most readers are 30 or over. Just a guess. So, put yourself in the shoes of a person in their early 20's. You are going to graduate from college, look for a job and want to start your adult life. You want to work hard, buy a couple things, maybe get married, own a house (in time), etc. And, you're done sticking your head in text books every night and you start paying real taxes (not just from part time summer work) and you look around and you ask, "what kind of mess have these old people gotten us into?" Seriously. The current public officials cannot sit in the same room and discuss anything reasonably. Every group is tied to an agenda that has been so clouded by rhetoric that we can hardly understand the issues any longer. When I graduated from college, the bank sent me a payment book and told me I had to start paying back the student loans I had taken out to finish school. I knew they were coming but when the payment books actually showed up it was a cold slap in the face and a quick re-do of my budget. Ahhhh, I wasn't counting on paying that every month but I guess I'd better start doing that. I took out the loans and I spent the money and, consequently, I paid off all my student loans. Today, these young kids are not just paying off those loans but they will be stuck with so much government debt it is not even something one can comprehend. Seriously, it is impossible to wrap your head around it. Next, they are going to be told that they have to work their asses off to pay into government programs to support all the baby boomers who are retiring. And, we all know, there are more people that will be taking money out than there are younger people putting money in. I can hear the conversation now:
Older Person (OP): "You see, I paid in to this pool my whole life and now I expect to be paid back what I contributed. That's only fair."
Young Person (YP): "I guess that's fair but where is that money you contributed so I can give it back to you?"
OP: "I let somebody my age spend it all on other stuff, so it's really not there any more. But, I'd still like it all the same."
YP: " Wait a minute, you want me to pay you all this money you saved but it's gone now? So, there's nothing there? Where am I supposed to get the money to give you"?
OP: "Now young man, just watch your tone with me. Men and women like me have paved the way for you young people. You just get out there and work like I did and pay up what you rightfully owe."
YP: "You are kidding, right? You guys took all this money, put it in a big account, then spent it all on yourselves and now you want me and my friends to work extra hard to make up all the money you squandered because you did not have the ability to discipline yourselves. Is that it?"
OP: "Now that's how it worked with my generation, we worked and took care of the older people."
YP: "No you didn't. I just got our of college and the deficit has just gone crazy since I was a little kid. And there were not nearly as many old people back then. Say, aren't you the same group of people I read about that were hippies and came up with junk bonds and ponzi schemes and that stuff? You want me to pay for all that?"
OP: "It is the law young man. It is the law. Just pay and quit being disrespectful of your elders."
YP: "Sir, have you ever read 'Atlas Shrugged'? And by the way, you should be grateful to us. Our generation gave you Facebook and the ability to link up with your old high school sweetheart, so don't underestimate our contribution."
OK, I know I have gotten off topic. Totally. But honestly, I think young people are going to have to plan on retirement age being age 75 rather than 65. Or one of these days they will be the elected officials and they'll simply tell us, "Nah, you can't have that much anymore. You spent it all." Hope you've been saving your pennies. Now back to the fastener industry.
There are a lot of mixed signals in the market. When the FDI acts like a yo-yo and goes back and forth it does seem like our industry too has its own issues to deal with. It appears as though we are recovering one month and then the next month it seems to drop again. Some fastener companies are adding new products or trying to re-invent themselves. Some are closing warehouses. Some companies are realizing they have an aging work force (too many vacation days per employee) and are trying to add young people into the mix. In some cases we are seeing people sell their family businesses. I read about one well known industry family that had started and sold a family business only to re-start the family business and bring back a family member who had started his own rep agency. Good for them, I hope they have great success. I wish them lots of luck. Conversely, in several cases we are seeing large companies get larger through acquisition. In the end, we are all guiding our own ships through the challenging waters. And in rapidly running water one can never stand still.
Mergers and Acquisitions
I'm not an economist or financial expert. But I wonder, why does there seem to be such a flurry of these transactions? Would we have seen more of these over the last few years if we did not experience the downturn in 2007-2008? Is this just pent up activity that has been waiting to happen? Are uncertain government regulations and taxation uncertainties having an effect? Or, is this just a normal pattern when these types of mergers happen is spurts?
I suppose each one is different and there are different reasons why a mid-sized, privately owned company is sold versus a large, corporately owned company. In one case it could be that the owner does not have a family succession plan and determines it is better to just cash out and enjoy the fruits of his or her labor.
I just posted a comment by someone asking if there are any fastener plants for sale. Just posted it ten minutes ago. Very interesting that someone would find this site and post that question. All I'm saying is that if this gentleman finds a manufacturing plant to purchase by posting on this blog site then I am way underestimating the power of a fastener blog site. Good luck. If you do find a seller then I hope you realize you owe me a beer.
What is your Mission Statement?
"To offer outstanding customer service and provide a work environment where employees can reach their highest potential."
"To deliver products to our customers in an efficient manner that allows us to profit fairly while continuing to grow and prosper"
I just made those up out of thin air but, just so you don't think I am exaggerating, here are a few Mission Statements from some Fortune 500 companies. If you google Mission Statements, you can get a list of the Mission Statements of Fortune 500 companies. Here's a few of the inspiring statements that, I am certain, have moved mountains:
"To combine aggressive strategic marketing with quality products and services at competitive prices to provide the best insurance value for consumers"
"Guided by relentless focus on our five imperatives, we will constantly strive to implement the critical initiatives required to achieve our vision. In doing this, we will deliver operational excellence in every corner of the Company and meet or exceed our commitments to the many constituencies we serve. All of our long-term strategies and short-term actions will be molded by a set of core values that are shared by each and every associate."
"...mission is to "Be the best in the eyes of our customers, employees and shareholders."
"We are a market-focused, process-centered organization that develops and delivers innovative solutions to our customers, consistently outperforms our peers, produces predictable earnings for our shareholders, and provides a dynamic and challenging environment for our employees."
You get the picture. Forgive me for being a pessimist, but I don't really envision too many employees welling up with pride and putting any of those statements on their bathroom mirrors reminding them why they are getting up at 5:45 a.m. to go to work each day. And, what exactly is a Mission Statement?? Here is what Wikipedia has to say about Mission Statements:
A mission statement is a statement of the purpose of a company, organization or person, its reason for existing. The mission statement should guide the actions of the organization, spell out its overall goal, provide a path, and guide decision-making. It provides "the framework or context within which the company's strategies are formulated."
Boom! There you go. I think it is a real disservice that the Mission Statement has been relegated to a statement on the wall of a company or on some piece of literature. And, my guess is that most Mission Statements are old and have not been changed since the time that some business strategist came in, ran a few planning sessions and walked away with a healthy paycheck. I think I can summarize the Mission Statement most companies I work for have in mind for me:
"Go sell more fasteners and make sure you sell at a good margin".
There are a lot of different types and sizes of fastener companies in our industry. Some companies really could gain some benefits by determining exactly what is their "reason for existing". But, let's face it. We all deal with a lot of companies where the Mission Statement should read:
"Buy the fasteners as inexpensively as possible. If your current supplier raises a prices, shop the hell out of that item. If you can't get the price we need, see if you can shop that bad boy overseas through anybody you find in LINK, on google or at the Vegas show."
Sure, I'm exaggerating, but not by much with some companies. So, what should a fastener company Mission Statement look like? Something like:
"Sell as many fasteners as possible at an acceptable margin that allows us to offer excellent products and customer service and still make a fair profit." Hmm. That actually sounds pretty good.
To tell you the truth, I don't think Mission Statements are worth much anyways. In an ever changing marketplace, the true mission of a company could change and change frequently. During 2007 & 2008 it might have been a company's mission to survive and let go of as few employees as possible. No one was worrying too much about "providing a dynamic and challenging environment for our employees" during that time period.
Our industry is changing. The players in the fastener supply chain are bringing new tools into the market place from vending machines to on-line purchasing to expanded product lines to new, uniquely engineered products. Some folks are expanding and some are getting lean. As I have recently written, there seems to be a lot of mergers and acquisitions in recent months. Some companies are tired of the fight and some realize they just need more resources to compete in the new marketplace.
I personally am not a fan of the Mission Statement. I do not think many companies pay attention to them once they are written and plastered on some wall or piece of company literature. That being said, I am a huge believer that you must continuously review and update your company's mission. What are you trying to accomplish? Are you trying to hang on to what you have? Are you looking to grow this year? By how much? More importantly, if you plan to grow 3% or 5% or 12%...seriously, where the hell is it going to come from? Seriously? You cannot just pick a number out of thin air. Well, you can but if there is no real thought or plan behind it then what can you expect? Are you watching your competition? Who is coming after your business and what are you doing to go after theirs? What do you want to be when you grow up?
Next time you are in a business and see the Mission Statement on a plaque on a wall, ask yourself, "is this company actually working on and following this mission?" If they are not then they got swindled by a consultant once upon a time. If they are then perhaps I am wrong and some companies do take those Mission Statements seriously. And, good for them!
FDI Index Looking Good
So, January looked good according to the members of our industry who participated in the FDI survey. I thought things looked good too. Most everywhere I called, the mood was positive and business in 2013 seemed to be starting in a positive way. Lots of good things to quote, some good orders placed, some which might have been postponed last year due to the "fiscal cliff" stuff. But I think this year is starting very positively. I recognize, I only travel a limited area of the country, mostly east of the Mississippi, so I welcome any input from my industry friends on the West Coast.
The stock market has been strong, and several other economic indicators have been fairly positive. Sure, things are not perfect, but I suppose we will take any positive news we get. Bottom line is we are called to produce and grow sales no matter what the indicators tell us. But, if positive news helps the general mood, so much the better.
I've been looking at plane tickets for Vegas and for the All American Fastener Show in Kansas City. It might seem a bit early but air travel is a lot tougher to coordinate (and pay for) than it used to be. Looking for that good deal. I can drive to Fastener Tech '13 and to some of the other regional events. The shows themselves are great but I like some of the other activities that are being coordinated around these shows. Meetings between NFDA and some of the regional groups. Training seminars! I'm looking forward to the Lunch Seminar at the All American Fastener Show on "Corporate Image Branding & Web Marketing" that will be put on by Brooks-Jeffrey Marketing, Inc. That seems like a topic that should be popular with distributors and vendors too.
So, let's keep things going in a good direction and we will see you soon at an industry event near you.
Sorting Some Things Out
Within the last few years, Grainger added many new fastener sku's and then the went ahead and purchased Fabory. In a different twist, we recall Fastenal purchasing Holokrom. I really thought they would have a difficult time selling Holokrom to other distributors (who would then be competing with their arch rival) but it seems to be going well enough.
Back in the day, (a side note here...my friend, Larry Kelly of Buckeye Fasteners has a rule that says in order to use the phrase "back in the day" , you must be at least 40 years old....I qualify) companies like Supply Technologies (ILS at the time, and Fastener House before that) would buy out competitors. They bought companies that pretty much did the exact same thing that they were doing but with different end user customers. Now, there is a lot of crossing of lines. Another recent example is Hillman buying Paulin. Sure, Paulin has a division that sells to home supply chains in Canada but they also supply weld fasteners and other products to a wide range of distributors and end users. Again, that acquisition blurs the lines.
I think we are destined to see many more mergers and acquisitions as the year goes along. I only wonder what other surprises are in store for the fastener industry this year.
Domestic Manufacturing is Cool
If I am sad enough to admit that I have a fastener "bucket list", crossing Huck off of my "places to tour" list was an accomplishment. Nucor is next. Many of you have the opportunity to visit domestic manufacturing plants if you do enough business with a particular company. Plant tours are one of the many things I think the regional fastener organizations offer to our industry, and consequently, I like to try to promote the groups. I think I list most of them along the side of this blog with quick links. The NFDA is making an effort to coordinate some of their meetings with the regional organizations and I salute them for that. If these groups can coordinate their efforts, who knows what good things can come from it. The fact that there are three groups working together to offer the Nucor tour is a good start. I am certain we are happy to see any company doing more manufacturing domestically because it gives all of us more opportunities to sell fasteners. But, in particular, I love seeing domestic fastener companies growing and thriving. It's good for all of us. And, domestic manufacturing IS cool.
Fastener Industry 2013 is off and running
And, what DO we see for 2013? So, we avoided a fiscal cliff and we all hear that we will be facing another one in a couple months with debt ceiling limit negotiations and budget cuts that eventually have to be addressed. Certainly all this affects our industry and our customers but, to some degree we have to go out there and sell to the market that exists, despite the peaks and valleys. If the economy is robust, we sell. If the economy is dragging, we sell. But, what I have one eye on this year is consolidation. If players come and go in our industry, then that affects all of us whether or not the economy is good or bad.
I often reference Kiplinger as one newsletter I read regularly. Just got my January 4 letter and it read, "Look for corporate merger-and-acquisition activity to increase this year. With $1.7 trillion sitting in corporate savings and cheap financing available, more firms are looking for high-yield ways to deploy their stashes and buy growth". While Kiplinger is talking on a macro level, speaking about companies worldwide, it struck me how close to home this hit, just in the first week of 2013. Over the holidays I got a notification that Applied Industrial purchased Parts Associates, a MRO/Catalog distributor based in Cleveland. And then just yesterday I read where Jergens (also Cleveland based) bought a local distributor of cutting tools, the John Allen Co. Two acquisitions in less than a week, both in my back yard and both in the industrial distribution market. And, as we all know, 2012 was a pretty good business year. So, I assume, it is not like these companies were necessarily gasping for breath (though I truly do not know any financial details relating to any of the involved companies) but rather that other companies saw opportunities for growth and jumped at the opportunity. Applied Industrial purchased UZ Engineered Products last year, so that makes for an interesting collection of companies to be coming under one organizational structure.
It is early 2013. Lord knows what we will be talking about at the All American Fastener Show, or Fastener Tech '13 or the Vegas Show. If Kiplinger thinks mergers-and-acquisitions are happening on a macro level then we can imagine some of this will happen in our world, the fastener industry. Speaking of the All American Show, this year in Kansas City, if there happens to be a Kansas City Royals baseball game any time around the show, I'd like to attend as I have never been in that ballpark. As the date gets closer, I will check that out and send out an invite to see who else might want to attend. If I had the time, I could spend an entire summer visiting baseball parks and it would be a perfectly enjoyable summer.
One last thought. Over the holidays I visited with a younger brother-in-law who is a savvy tech guy. He is usually up on most tech or internet related topics. Two things shocked me though. First, he had never seen or listened to Tosh.O. Totally inappropriate, but oh so funny. Secondly, he does not have a Twitter account. Pretty shocking for someone who is in sales and is generally a wired-in kind of guy. As I talked about Twitter I explained to him there is no better source for instant news on almost any subject. Case in point, I am a Cleveland Browns fan (no jokes please) and there are numerous rumors and much speculation that by the end of today Chip Kelly will be named the new head coach. If you go on Twitter, you can "search" for a topic (Browns, Chip Kelly, etc.) and you can scroll down a good 20 links that will take you to articles written by countless journalists about the specific topic that interests you. Honestly, for a die hard sports fan, Twitter is an awesome invention. What does that have to do with fasteners? Each Friday, there is a handful of fastener industry people who use Twitter and use the hashtag #fastlink in their communications. If you search #fastlink, you will be able to see anyone else in the fastener community that is on Twitter that day using that hashtag. Some Fridays there are 10-15 people on there. Some Fridays, not as many. But, if you are on Twitter, come join us on #fastlink Friday. If you are not on Twitter, you really are missing a very easy way to find a lot of instant information about any topic. You hear news as it is happening. Enjoy your weekend and all the NFL wild card games. I will watch and lament as my Browns are, once again, watching the games from home and not participating. It does help knowing that I have a kindred spirit in Mike McNulty of Fastener Technology International who knows and shares my pain.
Still Here
As I read the article I wondered whether or not these trends were noticeable in China's fastener business. People who travel overseas for the fastener importers might have some insight. I'd also welcome comments from world fastener travelers like Rob Lucas and Ruth Dowling who travel to Asia regularly and might be able to offer their own insights. Clearly, fastener products have been pumped into the U.S. market by certain companies and I guess that is fine as long as they continue to be consumed and replenished. But, this was not the case with toys and shoes and furniture and zippers according to the article. I'm not sure if the fastener market is affected but it is an interesting question.
I'm writing on December 21 and, so far, we all seem to be here. I kind of figured we would be but, (as Eric Dudas referred to them), those rascally Mayans suggested otherwise. But, I'm glad to be here because I have a few road trips and appointments planned for January and I'd hate to think I did all that work for nothing. It has been a good 2012 but now we wait for our fearless leaders to come up with some magic plan to avoid the fiscal cliff. And I think the plan that they come up with (if they do) will either send us into 2013 on a positive note or it will leave us shaking our heads wondering what to expect with the new year. Like I always say, regardless of what happens I'll get up tomorrow and go try to sell fasteners. But, I think some kind of effort at cooperation between those that we have elected would certainly go a long way towards helping businesses move forward with more confidence. Kiplinger and some others suggest that early 2013 might be sluggish but we should see stronger growth later in the year. And I just got my STAFDA economic report but have not read it over yet. As a whole, we will all go out and do our best to accomplish goals and move our companies in a positive direction but it sure would be nice if the government gave us any reason for optimism.
If you are taking a few days off in the next week or so I hope you have an enjoyable and relaxing time. I will be sorting files and cleaning up large amounts of paper in my office, but I'm sure I will have plenty of time for family and friends. Enjoy the holidays, have a very Merry Christmas and drop me a line if you are around next week. My kids are older now and there are no toys to assemble so I will be checking my e-mails and driving to the office to pick up my mail and take care of whatever comes in during the next week. I'm pretty excited about 2013 despite the nonsense that goes on around us politically. Merry Christmas and a very Happy New Year.
Two Weeks Left
Looking forward to going to the Mid-West Fastener Association Holiday party this week. I have never been to one before but it sounds like a good time. The MWFA is a large group so I'm guessing it will be a pretty big party. Speaking of industry groups, I read where the NFDA is trying to coordinate more of its activities with other industry associations. They have held meetings in conjunction with PacWest and they will be holding another meeting in Chicago at the same time as the MWFA has FastenerTech 2013. There is definitely a place for an organization like NFDA to act as a liaison between the many regional groups and it is good to see them taking the initiative.
In other organization news, the North Coast Fastener Association has started to post some old photos on their Facebook page. In addition to posting pictures from current activities, there are several older photos from over the last 30 years with some familiar faces and different hair styles! To anyone on Facebook, please find the industry association websites and "like" them so you can keep up on what is going on with them.
Good luck in the next couple weeks. There will be lots of lunches, dinners, popcorn tins and chocolate exchanges going on but there will also be some fasteners sold. I've still seen some good activity over the last week so all has not slowed down yet. As Mike McNulty always suggests, stay focused on fasteners but take some time to enjoy the season and those who help make your business successful.
The Home Stretch
Several of our East Coast fastener friends have had to deal with Hurricane Sandy. Many warehouses had to close for a period of time because they had no power. I spoke with Vincent Chiappone, Executive Vice President at the Richard Manno Co., located on Long Island (West Babylon), NY, an area hit terribly hard by the storm. Ironically, they never lost power at the Manno manufacturing facility, but every one of their employees suffered power outages at their homes. I guess that is truly one of those instances when coming to work has its benefits. So, while each person had to deal with difficult situations, the company did not miss a beat. I heard that many other New Jersey area warehouses were closed for a time including Stelfast, Brighton and Porteous. I know Stelfast brought in reinforcements to their Cleveland facility to take calls that normally would have gone to their New Jersey office. I am sure there are several other fastener companies that were affected by Sandy, but these are just a few I heard about.
The election and the fiscal cliff are absolutely affecting the economy, at least temporarily. Companies that were counting on a Romney White House are reassessing their business strategies moving forward. And it appears no company wants to make any bold moves until the fiscal cliff issues are resolved. So, what's a fastener company to do??
Oddly enough, I have seen some very strong activity this last month. I have seen some very large orders that would make me feel optimistic about the fastener market if it were not for all the other news. Some of the orders are for deliveries well into 2013, which tells me not everyone is sitting still and waiting to make decisions. Still, it feels like there is a lot of uncertainty out there.
We are coming to the end of the year...the Home Stretch. December can be a very productive month. Some people treat December like a month when they can kick back, call it a year and figure they will check out until things get going again in January. Maybe take a few customers to lunch, enjoy a Christmas Party and send out a few holiday tins filled with wonderful tasting junk food. Those are all good things, but December is really a great time to plan and set your sites on the next year. And, let's face it, we still have more than a month to do business in 2012. In fact, Fastenal still has its annual meeting in December coming up in Orlando when they bring in employees from all over the country to a several day long Fastenal trade show. You think they're sitting on their hands in December?? Not a chance.
I might be nuts, but in my mind there are still places I feel I need to visit by the end of the year. And that pretty much means that I need to get these things done by about December 21, because after that most companies are in holiday mode till the end of the year. That leaves me approximately 23 working days to make the trips and see the people I think I need to see. Logically, some of these people will be just fine if I do not see them until January, but in my mind, I want to get there this year. And the territory I cover can get hit with snow storms anytime from about now until April. So, you never know if all of those 23 days will be good travel days. I've got my plan and and I am heading into the home stretch with a full schedule and lofty goals. So, good luck to those of you also planning to do great things with the rest of 2012. Make the best of the short three day week and be sure to enjoy your Thanksgiving holiday. Eat some turkey, some pie and whatever else you like and be sure to get some rest. There's another 20 days waiting for you after that to either make it a great 2012 or start planning for an even better 2013.
Another Guest Blog from Charlie Accetta
Was just watching an excerpt from "60 Minutes" and it touched upon some of the subjects covered by Charlie is the following post:
The Moving Target of Success
Long before my introduction to the Quality Assurance discipline, the idea that “there was always room for improvement” was a given. QA just gave it a mathematical spine and some form of conceptual reality. Perfection was something to strive for, more as an ideal than actual goal, because perfection represents an end to the beginning, the last star before perpetual darkness; the last gas station before the highway reaches into the infinite desert. Besides, it lacks the appropriate measure of humbleness that we normally display in the presence of God. Perfection hints at Nazi-like evil, or at least Nietzsche-esque arrogance, of a race of Supermen creating the perfect society, complete with perfect homes, perfect lives and perfect cheeseburgers. We practice Talmudic patience and Christian forgiveness in our lives – we live to learn and we forgive mistakes, our own as well as those of others. Our perfection of imperfection provides us with the ultimate paradox; in limiting our reach in order to taste some measure of success within normal societal constraints, what are we doing to the larger context?
Much of our time, we are riding with our proverbial foot on the brake. The concepts of team and cross-applicability in the business setting are meant to keep the slowest member within reach of the group. This is a carryover from military science, where a strong philosophy of interdependence means that squad members are responsible for the lives of their comrades. The difference between a combat setting and the business arena is both subtle and stark – livelihoods rather than lives may stand in the balance, but the training that generals invest in their foot soldiers is a quantum leap from that provided by most businesses for new employees. Training a lowly clerk away from the action is deemed a waste of resources for most business owners, especially in the current circumstance, where each new hire arises only after the need exceeds red-alert status. In the aftermath of such decisions, is anyone measuring the true cost of exposing their customers to an accelerated error machine that is a poorly-trained employee? If they do, they understand the degree of damage inflicted on the reputations of their businesses. And still, they cannot fully quantify the toll of destruction. Why? It is because most customers are reluctant to reveal the awful truth. They simply cease calling.
Meanwhile, most businesses do react belatedly to those customers who are kind (or livid) enough to register a complaint. They rarely fire the employee responsible (in part because the employee is rarely truly responsible); rather, they take some time to assess the employee’s skillset and determine if training or reassignment might yield better results. After all, none of us is perfect. Still, the cost for this process is the same, no matter at which point in the timeline it occurs. It makes sense to some of us that the ideal time to perform these actions is at the outset, before any customers experience adverse effects. Those business owners in a position to hire in the first place have already achieved some measure of success. Most of these people are inveterate gamblers at heart and don’t see any upside to buying insurance before the dealer reveals the hole card sitting next to the ace.
Going back to the military analogy, generals gamble with the lives of the soldiers in their charge only at the last resort. The greatest of them, having met situations that called for such sacrifice and come out on top, remain reluctant to repeat such actions. Most business owners do not exercise such thoughtful care with their troops, perhaps because they see only their own shadows in peril’s spotlight. The fact is that most small businesses have adopted such strict compartmentalization at a time when larger organizations have acknowledged the folly of overlaid business management structures that there is little direct communication of value between the front office and operational staff. What remains of middle management is so caught up in surviving the next downturn that they are mostly reluctant to deliver any bad news in either direction. Imagine the worst lieutenant in the Army; not communicating conditions on the ground to his commanders and not communicating command’s decisions to his sergeant. This is a poison filtering through the entire body of an organization that leaves it both blind and paralyzed. Middle managers who fail in this regard are unqualified because they have not received the advanced management training called for in such sensitive positions. Again, the value of training is impossible to measure until a postmortem is performed. Businesses die needlessly because they don’t know how to perform tasks as simple as taking their own temperature and reporting the results.
The cost of college-level management courses is minimal in comparison to the overall investment of a typical ten-year employee; it appears ludicrous to neglect such an important element in an ongoing business venture. The only alternative is to eliminate middle managers entirely and expand the reach of upper management. That might seem counter-intuitive, but I have seen situations where executive-level personnel worked within narrowed scopes of authority and responsibility, each managing his or her area both independently and in complete communication with other executives who are likewise assigned their own areas of concern. Even then, all executives should be required to attend courses for their continuing education.
In the end, success is not a static condition, nor is it reflection of one’s charity or virtue, nor is it a continuing deal from the blackjack shoe. Success is an attitude born from preparation for the next yet unseen challenge, a moving target that could easily disappear permanently from the view in the space of a single blink. The best defense of your vulnerable frontier is the trained lookout, the more of them the better. In the coming upswing, don’t just hire bodies – create a force aimed at systematically serving your company’s greater mission. Never stop training.
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Charlie Accetta
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Twitter: charlielmo
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Vegas Fastener Show Review, #2
It has taken me about a week to de-tox from the Vegas show and get caught up on stuff that did not get done while I was at the show. And, there were a lot of things to follow up on from the show, so I've been a little bit lax about getting to my Review #2. Thank you for your patience.
In my last post I talked a lot about the "social" aspects of the show. Who was there? Where'd they hang out? What did the booths look like? All that is important stuff and some good fun. But it leaves out some other significant aspects of the show which I'd like to touch on here.
First of all, I already said I thought it was a great show. I think it was as just as active a show as 2011. And, 2011 was a good show with people finally coming back to trade shows after seeming to avoid them during the 2008/2009/2010 recession era. Every year, the beginning of the show has a wave to it like a group of fans doing the "wave" at sports event. Start at aisle #1 and watch as the early attenders make their way from aisle 1 to aisle 17. The wave. So, if you are somewhere in the middle, you see the first wave around 9:45 as people filter in from right to left. There are exceptions. There are always people on a specific mission, whether that is to visit a specific booth for a meeting or to pick up the new Stelfast monkey. But, in general, the show moves from right to left. And the show loses a significant number of people somewhere around lunch time as suppliers take a break or take customers out for a bite to eat. Then, after people trickle back, there seems to be a period from about 2:00 - 4:00 where some attendees leave the show to get ready for the evening or to drop stuff off at their room before they return for hospitality suite entertainment. Thursday night seems to be the late one. People try to behave on Wednesday night so they are ready to face the long show day on Thursday. But Thursday night is another story. Heck, anyone can struggle through the half day of show on Friday, so they let loose on Thursday night. I have heard people say they think the show could be a one day show. I totally disagree. There are several people who work the show hard on Friday when they can get more individual time with people that were too hurried to stop and converse on Thursday. But, more importantly, if there was no Friday some people might go home after the show Thursday. And that would be a bad thing. Thursday night makes the show! The time to relax and hang out with industry peers is invaluable.
Before the show in 2011, the big news about Heads & Threads was announced and that was widely discussed at the show. Right before the show this year, there was an announcement that Lindstrom had purchased Bossard Metrics. However, there did not seem to be much of a buzz around that story at the show. From a personal standpoint, I found the story interesting. During the early years of my fastener career, Bossard was "the cadillac" of metric suppliers. They had the "Blue Bible" (the Bossard catalog, filled with the cult like "BN" numbers) and they had Bruno Marbacher running around the country doing "Metric is Simple" seminars for those U.S. distributors who didn't know a DIN from an ISO or a JIS part. And forget about the metric tolerance system. But, if you did enough business with Bossard, they just might answer your phone call and even let you talk to Bruno and he would set you straight and you would pay a healthy price for the part plus a mark-up for the knowledge. Eventually, the market place realized that a metric part had about the same amount of steel content as an inch part (just some funny threads) and some of the magical price premium eroded. And, eventually, distributors became more familiar with metric fasteners, and they started shopping harder.
I represented Bossard back when they were a dominant player in the metric market. As Lindstrom started to make inroads into my customers, I told the current President of Bossard (and they changed every couple years), "You need to squish them right now. Lindstrom is gaining momentum with several of my customers. They are getting very aggressive". I was told by the President at that time that he was not too worried about them and that he did not think they were that big of a factor. Years later, after Lindstrom became a bigger player in the metric market, I told this story to Virgil Lindstrom (not sure if he would remember) and Mike French.
And Lindstrom grew to be a strong competitor, eventually eclipsing Bossard Metrics at their own game. First they acquired Bossard's Monster Metric operation (pre-Mega Metric company for you newer fastener people). And now, the Lindstrom purchase of Bossard Metrics is just the final chapter of a long story that has been taking place during most of my fastener career. The really sad part of the story took place several years ago when Henry Bossard passed away at an early age. I'm sure there are a lot of industry veterans who have their own memories of Bossard and their rise and fall in the metric fastener market.
So, I guess I was surprised that this deal was not spoken of too much at the show. But, this is a new generation and Lindstrom now has its own set of competitors aiming to knock it off its perch. Neil Young wrote the following lyric in one of his songs, "the king is gone but he's not forgotten...this is the story of Johnny Rotten". OK, so I admit I get a kick out of including Neil Young in a fastener blog post because I've long been a fan. But my point is that Bossard Metrics might be gone but it will not be forgotten. This is the story of Fastenal and Brighton Best and other companies who are shaking up the industry today like Johnny Rotten and the Sex Pistols were doing to the music industry when Neil wrote that lyric. While the overall response at the show might have been a collective yawn, the purchase was historically significant, though maybe overshadowed by what is up and coming in the fastener industry. And that is really what the show is about. What is up and coming? What is new in the fastener industry? And if you are one of the individuals who say, "I'm not going to the show this year, there's really nothing new there", then I think you are taking your eye off the ball. You're not staying on top of your game. Every year there is something new. Not every new thing will affect your business right away, but you need to be familiar with as many suppliers as possible and you need to know if they are growing and expanding or contracting and moving away from being a valuable supplier to your company. And I think a lot of stuff like that gets talked about at the fastener show from the show floor to the Bourbon Room.
And as we in the fastener industry know, "Rust Never Sleeps".
2012 Fastener Show Review
Let me take care of some of the important business right now. The Stelast monkey for 2012 is turquoise! For those of you unable to attend the show, I'm sure that was the news you were waiting for.
First of all, I want to humbly Thank Larry Kelly and my friends at Buckeye Fasteners for serving Old Rusty Bolt at their booth. They went through all the beer they ordered and it tasted mighty fine. It was not an easy job to get all that coordinated but Larry was very committed to making it happen and I think it was a fun addition to the show. Go buy a bunch of weld fasteners and specials from Ron and Clayton and Joe and Larry and all the boys at Buckeye and their sister company Ohio Nut & Bolt. Also, I want to thank Show Manager Jim Bannister for helping to make this happen. Jim is ex-military. He's tough on rules and plays things by the book but he has a sense of humor and was a willing participant to have this happen and I thank him for that. Great show Jim.
Eric Dudas and Brian Musker add another dimension to the show that did exist at past fastener shows. They are Fastener Social Media incarnate. They do interviews at the show, they promote show events on their radio podcast (www.fullythreaded.com) and they are active Twitter users promoting the inustry on that medium as well. And it takes a special kind of man -- a man comfortable in his own skin who will wander around the Vegas Fastener Show wearing the colorful Solution Industries shirt that was designed for the show by Solution's own Solution Girl, Laura Vath. Don and John, you owe Eric. You owe him big!!
The show was great. Very active with lots of good booths and lots of creative give away items. Solution had a very cool Solution Man glass for those looking to do the booth "pub" crawl. Rotor Clip had a safari based booth that looked like something out of Jungle Larry's Safari or Mutual of Omaha's Wild Kingdom. Cool theme. And, as I always say, the show is what you make it. If you work the show, the show can be one of the most valuable chunks of time you will spend all year. That includes the training sessions and other events taking place outside the show itself. For instance, I had an opportunity to meet Jay Queenin of Specialty Bolt & Screw. Jay is the current president of the NFDA. As of today, I could not even join the NFDA. They currently do not allow reps to join. But talking with Jay, I came away with a good impression of this organization and where they are headed. They have some interesting goals of trying to work with some of the regional fastener associations and coordinate programs to make them more beneficial to all participants. Not sure they will ever let reps join, and I'm not sure that I care. But Jay seems like a good guy with some good ideas and that was an interesting meeting I did not anticipate before attending the show.
And I must make sure to comment on the Thursday night gathering at the Bourbon Room. It was fantastic. Loud and smokey, but still fantastic. There were large groups from Stelfast and Brighton Best and Advanced Components and EFC and Metric & Multistandard (and, let's face it -- wherever Rich Cavoto is hanging out, the party is a lot more fun) and I'm talking everyone from owners to managers to salespeople. I met some folks face to face that I'd only before met through this blog or Twitter. Good to meet John Butler (and thanks for the beer) from KL Sales, and Aaron Shushan of Specialty Sales. Vickie Lester of Pac West and Mike McNulty of Fastener Tech showed up. Tracey Lumia of LINK was there. Also thanks to Jackie Ventura for making sure I did not go thirsty. Jim Sullivan and Mike Stamm from Chicago Hardware were there early and late. Really it was just a great gathering.
I noticed last year that this location was a good meeting place and there were quite a few people from the industry gathered at this bar, the Bourbon Room. By spreading the word, we were able to draw those people who were looking to gather up with other fastener people after the show was over and dinners were served. This location seems like a pretty central point to congregate and the rain kept many people from hanging out at the outdoor bars. I hope we can keep this tradition going unless someone else chooses to rent out a private room for the entire evening and invite everyone from the industry.
Finally, Buckeye Fasteners was kind enough to hand out Fastener Blog business cards at their booth. If you are new to this site, WELCOME! I invite you comment and share your thoughts on the show. If you are new and do not choose to write, then you are in good company. Not sure how so many people can tell me they read but never have anything to add. As Jim Rome says, that just leaves "more of me and less of you". I am not sure that is at all a good thing, but it's what you get. If you like reading this site then please find the "subscribe" button along the side and sign up. It costs nothing and I do not have paid advertisers...just google adsense along the side. If you subscribe you will get notified every time there is a new post. If you don't like reading this site then log the hell off and go watch football. It's Sunday, and that's what I'm going to do. Later.
It's Here! The Vegas Fastener Show
Earlier than in previous years, the Vegas fastener show is upon us. Looks like it should be a good one. Are you doing anything different to prepare for the show this year? Some years I go out there looking for a supplier that carries a specific product I want to add to my product offering. Other years I have had a lot of meetings set up by suppliers. This year, the economy has been pretty good through the first part of the year and I have less meetings to go to. Seems like the worse the economy, the more meetings get set up.
This year, I'd say I have more strategic plans for the show. While there is still a lot of 2012 left, I cannot help but to think ahead to 2013. I want to talk to some people about what we do differently in the upcoming year. I have already started to do this with some companies and it seems to always come back to the same topic - communication. Communication! What's going on in the field? What are competitors doing differently? Am I seeing quotes that are coming in? Who is following up?
I really like sales reports. I like Hi-Lo reports. Sometimes I get asked by companies I work with, "what do you need from us to sell more"? My answer is usually the same. I need to know what we sold last month, what we have sold year to date, what we sold last year YTD and what we sold last year in total. Where are we behind...where are we losing business? Who is ahead of last year...why are we growing with them? Who fell off the side of the earth (i.e., we see NO business from them any longer)? Sales activity sometimes does not really tell the whole story. A customer might seem busy but at the end of the year you realize they bought $200 less per month and they are down $2,400 for the year. But, "they seemed to still be busy"! Gotta look at the sales report. And whenever I get a sales report in an Excel spreadsheet I cannot help but to custom sort from low to high. I want to see who is down in sales. What am I losing or missing?
The Vegas show does not answer any of the questions above but it does give you an opportunity to hear what is going on in the marketplace. How are other people seeing business? It also gives you the chance to have constructive conversations in just a few days with more people than you could possibly talk to in weeks of phone conversations. Everything is there for you, you just need to work the show. Track down those people that you want to work more closely with next year and talk to them. Or set a date to talk with them after the show.
There will be time for fun in Vegas. And I certainly have used this site to write about Old Rusty Bolt beer, and I am sure I will make time for a couple of them. But, I am heading off to Vegas to work. My good friend, Don Shan of Solution Industries once commented to me, "Vegas is like your Super Bowl, isn't it?" I'd have to answer that it is for me and probably for a lot of other fastener people. Play ball!
#NIFSW and #fastlink for Show Tweeters
The show will be busy. It should be a good, good show. It is odd that it comes just weeks before the presidential elections. I'm sure there will be a good amount of political discussions in the aisles, unless of course we are all sick and tired of the non-stop commercials, discussions, etc. I'll admit, I am anxious to watch the first debate tonight. I am a big fan of debates and political speeches. I love them. But I hate all the commercials.
In addition to political discussions, I have to think there will be a lot of discussion about the marketplace. On many of my sales calls I get asked, "what are you seeing out there?", and I suspect that will come up at the show too. I am seeing some slowdowns or at least some temporary leveling off. I do not find people to be overly concerned at this point, and some are already saying they think 2013 should be pretty good. But things have definitely cooled down since the first half of the year. Sure there are a few companies that just had a great September or August, but overall everyone seems to be taking a breath. And I am hearing that from different parts of the country. Please feel free to share what is up in your area.
Again, feel free to join us at the Bourbon Room at the Venetian on Thursday, October 11 starting at 8:30. And mention this to your friends who don't read this site or do not Tweet or listen to Fully Threaded Radio. I know a lot of people have mentioned they want to know where people will be hanging out and I've shared this info with them. Let's keep the ball rolling.
NIFME 2012, Biggest in Years
I am going to try to Mobile App that show management is advertising. The instructions look simple enough and I did try to quickly download it already with limited success. But, I take more blame for that as I did not read the instructions completely, I am impatient and I was in a hurry. But, I will overcome my many shortcomings and hunker down and get this done. I think this will be a useful tool as I get ready for the show.
And, getting ready for the show is something I always encourage. Jim Bannister, Susan Hurley and Mike McGuire have set up this playground for fastener people. No, wait...an amusement park of fastener companies and people...and I'm coming to the show knowing which rides I want to get on and which food stops I want to hit. And rest assured, the Buckeye Fastener booth serving Old Rusty Bolt is scheduled for 12:01 Thursday as I think the keg will be tapped at 12:00.
I will be arriving on Tuesday morning. I was going to come in late that night then I realized I could probably get more accomplished meeting people out in Vegas than I could waiting around all day to travel. Have a lunch date set with my good friend, Ken Sanker, of Blue Chip Fastener. You might remember my article about a year ago when Ken was getting back in the industry after being out of it for about five years. It will be good to catch up and see how the past year has gone. Then I have a tentative meeting set with a company for sometime in the afternoon. I don't expect too many people to be in Tuesday evening, but check in if you are going to be. Then, starting Wednesday morning, it is off to the races. Meetings, meals, the "Welcome Reception", dinner, then trying to catch up with industry friends. Get up on Thursday and start all over again.
Almost everywhere I go people are talking about the show. I find it kind of funny when I ask someone if they are going to the show and they respond, "I don't know yet". It's in two or three weeks so I suspect they are not going at this point. But, you never know. I'm sure there are a number of people who decide to come at the last minute. And, if you are on the fence, I suggest you make the effort. I think this will be a good one.
One last thing. Because the show is so early in October this year, it is not like we will all go home, enjoy Thanksgiving and wait to see if things slow down as we enter the holiday season. Thanksgiving will still be a month away. There is a lot of year left to follow up on whatever gets accomplished at the show. And no matter what happens on November 6, I will be moving forward on November 7 trying to sell more fasteners than I did last year. That being the goal, I've got a lot of work to do in Vegas to help make that happen.
NIFSW Gathering - Bourbon Room, Thursday, 8:30 p.m.
Additionally, with the increased number of blogs, podcasts and Twitter users, there seems to be a small community of fastener people trying to understand and use these new social media formats. If you are not already aware, there are quite a few people who check in each Friday on Twitter and use the hashtag #fastlink to connect with other fastener people using Twitter. Some people come and go but, overall, there seems to be an increase in the number of people participating.
On Thursday, October 11 there will be a group of fastener networkers congregating at The Bourbon Room at the Venetian Hotel. We know a lot of people will be at dinners or hospitality suites right after the show, and that is certainly a good thing. But, after those are finished and the dust settles, feel free to hang out with industry peers at the Bourbon Room. We are setting the start time at 8:30 p.m., but come when you can.
October, 11, 2012 at 8:30 p.m. at the Bourbon Room at the Venetian!!
Admittedly, some people will be tired, some people will be sick of visiting with other fastener people, some people will just want to go off to shows or to gamble. No big deal. But, if you are just hanging out and want to catch up with some other fastener industry people, we hope you will join us. And, if this kind of gathering is interesting to you, please spread the word. I called the Venetian and they said there are table and chairs at the Bourbon Room and they play classic rock music there. And I think there is room behind all the tables if people just want to stand around. And if the place is not fun...we will adjust and move on from there. But it should give us a good starting point.
I have met some people on Twitter who I look forward to meeting face-to-face. I think there are fastener people from Europe and Asia and India and other countries who read my posts. I hope you too can join us. Just look for the people hanging around with show badges! You never know who you might meet. Somewhere in that crowded room could be a new customer or supplier.
Fastener Show, I'd like you to meet Old Rusty Bolt
Just in case you missed the latest edition of Fully Threaded Radio, #51, there was a major announcement regarding the Vegas Fastener Show, aka NIFSW. Yeah, yeah, yeah...there are lots of booths sold and gobs and gobs of attendees and all that stuff. But the Fully Threaded Radio announcement made by Larry Kelly of Buckeye Fastener might be the most important one yet. After extensive negotiations, Buckeye Fasteners has been granted exclusive rights to serve Old Rusty Bolt beer at the Vegas Fastener Show in October. They will be located in booth # 1043.
Try as I might, the distribution channels available to one solitary Traveling Salesman were insufficient to deliver the cold, frosty brew to hard working fastener professionals across the country (and world, for that matter). Larry, himself being an experienced connoisseur of craft beers, approached me and asked if he could serve Old Rusty Bolt at their Vegas booth and I thought it was an outstanding idea. So, my fastener industry friends, I would like to invite you to stop by the Buckeye booth and have a cold one. And, just for fun, log on in to Fully Threaded Radio episode #10 and listen to the Old Rusty Bolt jingle created by one of the many lovers of Old Rusty Bolt beer.
From California to Maine, from sunny Florida to the Alaskan north. All ye from across the nation who venture to the National Industrial Fastener Show West, you can count on a cold cool beverage waiting for you as you trudge through the ever expanding fastener trade show. Friends from China and India and Italy and Brazil...Korea and Taiwan, Germany and France...all ye who sweat and toil to fill the fastener needs of our growing economies...know that you have a friend that cares and wants to make sure you have a refreshing malted beverage after your long journey to America. Daniel Rivalin, my friend from France, I hope you can make it to the show this year because there will be a cold one waiting for you.
In a previous post I suggested that it could be fun to choose a time and place to gather out at the Vegas Show, once all of the Supplier Sponsored activities died down. The only time I think will work is at about 8:00 or 9:00 p.m. on Thursday night, after the first day of the show. I realize a lot of people get whisked off to fancy dinners that evening, but for me I am usually pretty well spent and am ready to chill out and relax after the show. If I go to dinner I am usually ready to sleep after that. So, instead of dinner, or if you do not have dinner plans for Thursday evening, consider joining up with our group and networking with people who Tweet, join fastener associations, read fastener industry blogs and listen to Podcasts about the fastener industry. Seriously folks, it is not nearly as pathetic as it sounds. Anyways, the final piece to the puzzle it deciding on a good place to meet up. I would like to field suggestions from my readers but I fear that no one generally responds to most of my posts and I will then have to actually do research and find a place near the show to hang out. Anyways, bottoms up and I appreciate any meeting places you can suggest.
Your friend,
T.S. (Mr. Beverage)
Passing of Person, Memory of an Era
I never met Polimeni but I have a lot of friends who did. Several of those friends (and customers) sold their family businesses to the likes of Questron and Pentacon and cashed out. Without a clear succession plan, I'm sure a lot of these business owners were glad to sell their companies and cash in on years of hard work. A lot of the people I knew were not necessarily "old guys" that were nearing retirement. A number of them are still in the industry, either having re-started new businesses or working for other companies. In some instances, I know the owners were at a crossroads - if they were going to grow then needed a large influx of capitol or they would not be able to maintain their Vendor Managed Inventory programs with large accounts. The infusion of cash was necessary for growth and if the owners were able to get value from their businesses, so much the better.
For me, I was selling to several of these privately owned fastener distributors. In few cases do I feel that the new, larger companies were better than the individual ones that were purchased. I knew a lot of talented business owners who I felt were marginalized and pushed out of management decision making positions even thought their years and years of fastener industry experience would have helped the new mega-companies. It seemed to me that more and more business decisions (busisions) were made based on accounting and financial data than on good fastener industry knowledge and experience, including many personnel decisions. Many talented inside and outside salespeople jumped ship to other companies, perhaps because their new employers did not value and compensate them like their previous employers. In one post from Global Fastener News, Polemini was quoted, "We're basically from outside the industry. I'm not real technical-which I understand the fastener business can be". But the theory was that if they brought in some of their own chosen fastener industry veterans to run things then the financial guys could lead them into the future. In the late 1990s, there was a belief that the fastener industry was fragmented much like the office products industry had been in the recent past. Distribution Dynamics CEO, Larry Del Santo, was quoted as saying consolidation of the $9 billion fastener industry "is going to happen, faster than in the office products industry". And, in hindsight, the industry has consolidated to some degree. There are fewer "Mega-Distributors" that compete for the really large national accounts, although a lot of smaller and medium sized companies still seem to capture some part of the business from many of those target OEM accounts.
One other quote I found interesting was Polimeni's view that the industry was "a very interesting, profitable business and a very fragmented industry populated by a lot of mom and pop distributors. It is an interesting opportunity for consolidating." True enough. Wurth and Supply Technologies and Anixter and Gexpro are all bigger due to their ability to fold other, successful distributors into their existing businesses. But then there is Fastenal, a company that has mostly grown organically, branch by branch, city by city. And, while there has been consolidations, there are still an awful lot of small and medium sized fastener distributors around today. Thankfully.
I have a theory - if your old man did not run a header machine or sell fasteners in the past, then you probably should not buy a fastener distributorship. If you never worked in a warehouse or sat at an inside sales desk, you do not really know the fastener industry. If you cannot understand that there are times when you have to ignore minimum order policies and end of day shipping policies (i.e., "our policy is that we cannot ship after 3:00 p.m.") then someone may eventually steal your customers. I'm not telling you my theory is accurate or well thought out. EVERY distributor customer I call on tells me that they service the hell out of their customers. But the fastener industry is quirky, and that is part of what I love about it. Some companies have successfully implemented the 80/20 rule into their business models, but many others have also spawned competitors by using this business model, Imposing high minimum order dollar amounts is tempting. And, it is very logical for companies to want to raise minimum order amounts based upon the average cost per invoice that is logically figured by an accounting department. But I can name several companies that have grown largely because their competition decided to "fire" small customers that were taking up their valuable time better with larger accounts. Sometimes it works, sometimes it doesn't. Most companies have an 80/20 mind set and tend to take best care of their most valued customers. But many companies manage to do so without making it obvious to their other customers that they are viewed as less valuable.
If I read the Global Fastener News articles correctly, Distribution Dynamics was mostly absorbed by Anixter and Question was mostly absorbed by what is now Gexpro. So, I guess they did not go away completely. But, again, go read the Global Fastener News articles because a lot of fastener people (including suppliers) lost a lot of money somewhere along the way and quite a few "non-fastener" guys seemed to make a lot. IF I read that correctly.
Guest Blog: Direct Sales/Rep Sales
As I prepare for the upcoming Las Vegas Fastener Show, it occurred to me it has been almost exactly one year since I started up my rep agency. Really, the better description would be re-starting my rep agency. I started up my own agency in 1995 after working for another agency for 14 years. I built my business up, got engaged (a long story), sold my agency and left my home area of Ohio. Fast forward a few years and I made it back to Ohio, got rid of a husband and found myself employed as a direct sales Account Manager for Ifastgroupe. I was still in sales but this time I sold for one company, had benefits, an expense account and the feeling of security that comes with a regular paycheck. The people at Ifastgroupe were good to me and I enjoyed my time there, but deep in my soul, I am a manufacturer’s representative. I knew I was a rep and I wanted desperately to get back to being an independent rep.
I am not looking for sympathy here, but I will tell you candidly and honestly, when I restarted my agency in August, 2011, I had no income. Seriously, I had none. Zero. I did have the commitment from a few good companies that said they would allow me to represent their companies and pay me a commission on whatever I sold. That was what I needed, just a few good lines to get me started again. A year later, I am making a little money, I’m providing for my son and I’m paying my bills. As of now, there’s not a lot left over so if you see me in Vegas in some of the same clothes I wore last year, please be kind.
I could go on and on making this blog about me and my struggles and accomplishments but that’s not what this is about. I’ve got plenty of good industry friends that have supported me and encouraged me and they’ve heard the stories, good and bad. What I would like to touch on here is the differences I see between my sales life as a direct salesperson and my sales life as a rep.
Being a rep is inspiring to me. That might sound corny but it is true. Luckily, I am a self-motivated individual. I like the idea of being responsible for drumming up sales for the principals I represent and then asking them to pay me for my efforts. Don’t get me wrong, when I was a direct salesperson I did a fair amount of that. But it was different.
When you are a direct salesperson the selling process is completely different. You have only one set product line to market. You sell it. You report on it. You do budgets and forecasts. You go to a lot of meetings, many, many more than I ever go to as a rep. You work on new projects as they come up for that specific commodity. You try to come up with programs that will help maintain or increase your sales. Most of time the details of these programs and projects were dictated through management but it was my job to sell them as part of the sales team. This team represented 100% of my income, which was not motivated or rewarded by a commission plus sales structure. I could sell $100 worth of product or a million dollars and my pay schedule would remain the same. But, once again, there is security in getting a regular paycheck, especially when you are a single Mom.
I spent a lot of time working with my customers as a direct salesperson but it seemed like I spent a lot more time talking about those individuals in meetings in board rooms and in sales meetings. These meetings were meant to determine the value of specific accounts, which I didn’t always agree with. As a rep, I talk to people just as often but it feels like I’m talking about opportunities and how to land business, not scrutinizing their past or future sales. The product spectrum is much greater since I represent a wide range of companies that cover a variety of different products, both hard-to-find and standard parts. I find it very gratifying when I am able to introduce one of my principals as a potential new vendor or solve a problem with their product that has previously been a problem area for my customers. I talk to the people I need to in order to get something accomplished then I move on to the next thing. While I do keep in contact with my principals regularly, it just feels like I am discussing new opportunites more and not just budgets, call reports, etc. Being a rep is a unique sales position that I find very fulfilling. It is not for everyone and living on a straight commission based income can be frightening at times, but I have confidence in my ability and I look forward to many more years in the industry as an independent sales rep. Thanks to all of you who have helped me and encouraged me along the way! Hope to see you in Vegas.
Jackie Ventura
Fasteners and Industrial Products
Vegas Preparation
Please forgive me for this not being a "proper" blog post. But I'm starting to get meetings and dinners set up for Vegas and I'm curious who will be coming out there. More important, WHEN are you coming out there?
I will arrive on Tuesday, October 9 by noon. I know that might seem early but I've already got a meeting scheduled for 1:00 that day just because I am arriving early enough to make it.
I'd like to find a time to get together with other people who read this blog and with any of the #fastlink Friday Tweeters. Anybody that is attempting to make sense of social media in the fastener world is welcome.
Please respond if you have interest in coordinating some kind of get together in Vegas. Since so few people respond on this site, I would like to invite you to send me an e-mail at fastenerblog@aol.com. Or send to any other e-mail address you might have for me.
If we have enough people, maybe we could reserve a space or at least choose a site where we could gather.
Who are the Fastener Industry Innovators?
One benefit of being a road warrior is I get a lot of time to listen to the radio and also books on CD's. A few months ago I made comments about the Steve Jobs biography that was published shortly after he died. Great business book with very interesting insights on Apple and on Jobs. Right now I am in the process of listening to the Walt Disney biography. I've always enjoyed Disney products including watching the movies as a kid and then again enjoying the movies and theme parks when I had my own kids. I still like Disney stuff.
The similarities between Steve Jobs and Walt Disney are uncanny. Not so much that they were similar personalities (though, in some aspects there are similarities) but rather they were both driven by producing the very best products they could imagine and envision. Both men put their companies in dangerously precarious financial positions as they re-invested everything they had in order to produce new products never before imagined. Profit was never really the main driving force for either man, rather they were both driven by a genius vision of what could be. Neither man personally developed the products that made them great. Walt Disney imagined Mickey Mouse but he was never the main illustrator of any of the Mickey cartoons, books or movies. Or, any of the other Disney characters. Jobs did not create the first Apple computer, he did not do the programming. Both men were visionaries that led teams of talented people to produce the products they knew would be popular with the masses. They did not give the people what they wanted, they gave them products that the people WOULD want. But no one questions that they orchestrated the production...they led the team...they were the creative catalyst behind the successful companies.
So, I asked myself, do I see any of these characteristics in the fastener industry? The old "build it and they will come" approach to fasteners. I'm sure some people would say that Brighton's movement towards online purchasing is innovative, but I think we all knew that was a direction a lot of businesses would go. They have just been earlier and more aggressive. I think of the early introducers of Vendor Managed Inventory programs. I think of Hillman and Midwest introducing the drawer concepts into hardware stores. Those seem like some innovative progressions that have caused companies and their customers to think differently.
One supplier that I find intriguing is Cold Headers. Say what you may, almost every fastener distributor, at some point or another, has found some special fastener that they wanted to get from Cold Headers. The story I was told was that the original founder of Cold Headers would order, and put into inventory, every part that he was called on to quote. If they did not have it, he found someone to make it and he put it in stock. I cannot verify that story but I would believe it as you can find just about any socket product in their inventory. Build it and Cold Headers will stock it!
I often talk about Fully Threaded Radio on this site. Brian and Eric have introduced the fastener industry to fastener talk radio and they have taken a completely new concept to the industry. In the process, they have also probably met more people from the fastener industry than any National Sales Manager or company owner. Between Fully Threaded Radio and Fasteners Clearing House, they have done more fastener industry networking in a relatively few years than any other two people I can think of.
Maybe the fastener industry does not loan itself to creativity like an Apple or Disney. But plenty of companies do try to innovate and come up with new ways to beat the competition. Is there any fastener company out there doing things so differently that you would consider them innovators or creative leaders?
"It's a Busision"
"A what?"
"A busision. Or a buscision or a bucision. A business decision! A busision"
"OK."
So goes life at the home of the Traveling Salesman. It's like living with a little kid who just learned to rhyme. My college student son continuously combines words into one word and he hit me with that one as we were sitting around talking about business. Let me continue down this path for one quick minute. I love supporting all the industry groups and have had WIFI members blog on here several times. So please forgive me if I make an unfair statement here. But guys have a couple talents or tendencies that the ladies do not have. First, there are things like this playing with language that my son demonstrates. Then, there is something about the young male that causes him to repeat movie lines that apply to certain life situations. When I was courting my dear wife many moons ago, my soon-to-be brother in laws would continuously repeat Monty Python lines. Sometimes I knew the context from whence they came but sometimes I just could not place the line. But my three brother-in-laws knew every one of them. Today, my 63 year old brother cannot have a continuous five minute conversation without injecting a line from a Sienfeld episode. And anybody in the room who was a Sienfeld fan "gets it".
My sons are borderline pathetic with the whole thing. Every dinner includes multiple South Park, Family Guy, Anchorman, Step-Brothers, or whatever lines and if there are other young males at the table, they all "get it". They know where the line came from and the context. It is an amazing gift that males have in this area and I'm just not sure the ladies do this same thing. Let me be frank. There are times when my sons do not get along and they get on each other's nerves. Sometimes their only real communication seems to be either making fun of me and my wife or reciting lines from shows and movies they have both seen. It is quite extraordinary.
What has this got to do with fasteners? (Whew, I've got my work cut out for me here trying to pull this one together, but here I go). Well, I have had a lot of fastener discussions in recent months about "business decisions" at various companies. In 2009 there were a lot of business decisions made due to the unprecedented overall drop in business. It was easier to make decisions in 2009 because sometimes the existence of a company depended on it. People had to cut back and, even though some of the discussions were very difficult, the decisions were not. Cut back or risk the existence of the business.
Today a lot more companies are trying to make business decisions in a fairly unstable atmosphere. No one is sure what the elections in November will bring. Some people act as though the election of one person will dramatically change things one way or another. Our system is not set up that way. For sure, the election is important and will cause a lot of people to move forward one way or another, but that will be due more to knowing what they are dealing with. In either case, the world will go on and business decisions will need to be made. No matter who is elected, you cannot go crawl in a hole and hide. Your companies will need to move forward.
I've been talking to a business owner who told me he is committed to adding some "A" players to his inside sales team. He's got some good people who answer the phone when it rings and competently take orders accurately. But he tells me he needs some "B" and hopefully "A" players. Someone who can pick up a phone and move business forward, not just react to an incoming call. This gentleman has made a busision and he is asking me to help him seek his next inside sales superstar -- no matter who gets elected.
There a lot of people trying to figure out the economy (but that is always the case). Do we add inventory, do we reduce it? Do we need more outside sales people? Are the people we have worth what we pay them or would I be better off paying more for a better, more productive employee? What do I do with this old inventory? Should I scrap it -- will I ever get a call for it -- can Brian and Eric help me get rid of it?
I always start to get excited as the Vegas fastener show gets closer. The communications start to pick up and it seems like a lot of companies use the show as a time to have formal and informal meetings. Before the show, a lot of reviewing gets done and future strategies are hatched from this process. That is what will be going on for the next couple months in August and September. Companies will get back from vacation and assess where they have been this year and how they want to finish the year. And, undoubtedly, plans for 2013 will be discussed.
The next few months will be very active with reviewing and planning. And from that, we will, no doubt, see a lot of busissions being made.
Ain't No Cure
Summers can be challenging. You take a vacation, a few other people you need to meet with take their vacation, and before you know it you need three weeks to get something done that might take a day or two normally. I took a week long vacation in June, returned on a Sunday night and left for Chicago and the MWFA Table Top Show on Monday morning.The show was productive and I saw many business associates, but by the end of those two weeks I felt like I had been away for months. So, for the next few weeks I attacked my territory like crazy trying to catch up on all the things I felt like I was ignoring the previous two weeks. It's ridiculous but, while my logical side tells me I deserve a vacation, some other part of me says "yeah, but you have so many irons in the fire..so many things that you should be working on...and what about that area...when were you last over there to see that customer?" I don't know if it is good old fashioned Catholic guilt or maybe, as Mike McNulty says, "I am still focused on fasteners", but I always feel like there are productive things I should be working on. It's the summertime fastener blues!
A lot of fastener companies that have veteran staffs have the challenge of fitting in everyone's vacation time. It's got to be a challenge for some companies as they are missing the equivalent of one inside salesperson for almost the entire summer. There are some people I know who choose to take off every Friday during the summer because they are due so much vacation time they could not use it up otherwise. I'm a commissioned salesman. I have that ever-present, nagging feeling that if I don't sell, I won't eat. I do take vacations but I swear I put so much effort in before I leave and then again once I return that I pretty much shoot to hell any of that relaxed feeling I had for the week I was gone. Good thing I do, in fact, like my job.
So, as I said, I have been traveling overtime lately trying to cover a lot of territory and see a lot of customers. Last year, everywhere I went, distributors were busy. Honestly, I would say that this year has also been very good. Not everyone is as busy as last year but plenty of distributors are just as busy. And more than a few are still having record months. About every week I hear, "well, it's an election year", but I cannot really determine what the exact affect of that is. If a company is struggling or sales have been down they say, "well, it's an election year." Then I go to another part of the state or even just down the street and they tell me they are extremely busy and business is great. So, it's a mix. And, legitimately, there are companies that do slow down during the summer. I like my summers to go by really, really slowly but I will be curious to see how business looks by about September.
The MFWA Table Top Show was as well attended as any I have seen in recent years. They had booths outside the main conference room, out in the hallways. I have read where the National Fastener Show West (Vegas show, to me) has had terrific booth sales and it looks like that is going to be a strong show. A lot of people are talking about Vegas right now as they are checking out flights and already making dinner plans. I'm heading out early on Tuesday so that I will have all day Tuesday to meet with people before the show even begins. If anyone else is going to be out there Tuesday, let me know if you want to get together for a beer or something. I have found that my schedule takes on a life of its own by mid-day Wednesday as I'll have meetings, the gathering bash and then dinners. I hope that by getting there on Tuesday I will be able to catch up with some people in a more relaxed atmosphere. If that doesn't pan out, then I'll walk the strip, do some people watching and do a little gambling. It's what we call a win/win!
I've read all the recent FINs and Fastener Journals and Fastener Technologies and there is plenty of news on acquisitions and China export jumps and Asian steel prices dropping and this, that and the other. Lots of big news but nothing quite as big as what was going on last year with stories like the closing of Heads & Threads. The fastener magazines and web site do a formidable job of printing and posting all the fastener news headlines. I like to try to bring more of the news from the street. NOT RUMORS! Mike McGuire long ago warned me about posting any of those. What I mean by "news from the street" is more what people are talking about when you visit their facilities. What are the people in the trenches talking about?? Yeah, there's some news out there. But it is more like, "I have been getting some terrific pricing from Porteous" or "Brighton is building an enormous place in Chicago" or "Stelfast has gotten very competitive on this or that product". It's more customer specific news. Right now, I am not hearing a lot of stories that EVERYONE is talking about. I guess it's the fastener summertime blues!
Well, for me, summer vacation has come and gone. Got a couple days set aside for college visits with my youngest kid but other than that I will be "focused on the fastener industry". Can I be honest? I wish I had thought of that line. I love that line. I salute Mike McNulty's catch phrase, and hope he does not mind me using it here. It's the highest form of flattery! And, the truth is, I will be focused on fasteners and I look forward to continuing to make good things happen through the rest of the summer and into the fall. Let me know if you will be out in Vegas on Tuesday and maybe we can round up a group of fastener people for a Fastener Focused gathering.
Guest Blog from a WIFI member
Ruth Dowling Coffman, formerly of Fastenal and Heads & Threads, is currently employed by Ningbo Jinding, a Chinese fastener manufacturer (www.jindingfstn.com). Ruth also serves as Board Secretary of the WIFI Association (www.fastenerwomen.com). Other blog posts by Ruth can be read at www.jinding.us.
One Woman’s Perspective on Life and the Fastener Industry
WIFI (Women in the Fastener Industry) Association Secret Revealed!
One observation I remember making as a young athlete was that male coaches made girls cry, but female coaches did not. The male coaches didn’t communicate any differently with boys than they did with girls. When their constructive criticism was handed out, often in the form of yelling, boys appeared to take it in stride and girls cried. What I was really learning at a young age is one of the fundamental differences between males and females. We communicate and respond to communication differently.
Women put a high value on communication. We have a deep need to talk about things. Sometimes we talk as a way to get our heads around a concept or as a means to problem solve. (If a woman ever tells you she’s “thinking out loud”, this is what she’s referring to.) Women are fulfilled through sharing feelings and relating to those around us. We communicate to build relationships, to help one another, to validate and to be validated, to reassure and to be reassured. We know that when we talk to other women we will be supported because women are instinctively nurturing.
Have you seen the ABC show, “Shark Tank”? If you’re unfamiliar, the gist of it is that entrepreneurs pitch their business ideas to a panel of investors (i.e. the sharks). If the investors (3 male, 1 female) don’t like a pitch, they offer sarcastic feedback. The entire set up is intended to be intimidating, undoubtedly for TV ratings, but to a certain degree mimics today’s business environment. Conversely, a company called Springboard Enterprises (www.springboardenterprises.org/dolphintank) has started hosting “Dolphin Tank”, an intentional word play on, “Shark Tank”. These “Dolphin Tank” meetings offer female entrepreneurs an avenue to pitch their ideas to other women without the intimidation factor and fear of being ripped to shreds.
So here’s the big revelation I promised you in the title. Ready? The WIFI Association is the “dolphin tank” of the fastener industry. It’s an environment built by women for women; a safe zone where women can interact, network, and have positive professional growth experiences without fear of sharks. Women in the WIFI Association support one another the best way we know how – we think, talk, and behave like women.
Finally, my male counterparts in the fastener industry, please know that we still need you! We need your help and encouragement. We need opportunities and experiences that challenge us. Most of all we need your support to learn and to grow in the way that works best for us.
MWFA Show Should Not Be Missed
Chicago is the heart of fastener country. So many manufacturers, importers, distributors all stuffed into one geographic area. When the MWFA holds an event, they have such a large membership that the events turn out great even if they do not draw from other areas. But, they DO draw from other areas including all the surrounding states and even some distributors from California were there. And, that is only a part of the story. Nancy Rich and her MWFA directors know how to conduct great events. The table top show was just awesome. Great attendance, good venue and lots of networking and mingling. The golf outing was very well attended. Originally, the start time was 1:00 but so many golfers signed up they had to add another start time at 7:30 a.m. to accommodate all those who wanted to participate. And the dinner after the golf outing was great.
I had never met MWFA President Matt Delawder of S.W.D. before the event, but he was an excellent ambassador for the group as he thanked everyone personally for attending. He went booth to booth and then again at dinner and again at the golf outing. Like I said, I do not know Matt but he seems like a really sincere guy and I felt like he meant it when he thanked me for coming. Left a good impression on me, for sure.
John from Global Fastener News, Tracy from LINK and the ladies from Fully Threaded Radio were all there representing our fastener industry media sources. Lots of pictures were taken.
Just an all around well run, great event in a great town. Would like to have caught a ball game when I was in town but I did not plan well. Maybe next year. Hey, keep that in mind MWFA. A night at the ballpark (either one) before next year's event.
In conclusion, I do not understand how any supplier/vendor does not attend this show if they are doing business with any distributors in the greater Chicago area. Where else can you find so many people in one gathering place other than the Vegas Fastener Show? And, honestly, that is a different event entirely. Vegas has more booths, more attendance and greater national exposure for sure. But the MWFA event does offer a sort of intimate setting that allows attendees really get some face-to-face time and that is also a very good thing.
Again, I want to once again congratulate Nancy Rich on an outstanding event. And, I cannot help pointing out something that I find really interesting. Between Nancy (MWFA and SEFA) and Vickie Lester (Pac-West & NFDA), our industry has two very talented women running four of the most active and influential industry groups we have. That is quite a dynamic duo.
Steering away from the show for a minute, I just read an article on the internet today about how Google is planning to manufacture its new "Nexus Q" in the United States. In direct response to Apple's claim that these types of manufacturing jobs are "not coming back", Google seems to be testing the waters to see if they can make their product here. According to the article by Karen Haslam, "The report in the New York Times notes that consumer electronics manufacture will be closely watching this case, to see if it disproves the accepted wisdom that consumer electronics products can no longer be made in the U.S." The article also noted that Google's device has a higher price than similar products made outside the county and Google is not disclosing the details about where the components are manufactured. Still, this kind of talk has got to make Harry Moser and the Re-Shoring people smile a bit. At least somebody is trying something, right??
Solution Industries - Living Outside the Box
"Johnny always could come up with a solution when someone needed a part. I used to send him parts that he would cut off, re-thread or whatever I needed to come up with a special part. I just knew we could take our years of sourcing knowledge and his machining capabilities and turn it into something" explained Shan.
So, in 2003, Shan approached Radel with the concept for Solution Industries and thus was born "Solution Man", the company's super hero mascot. John Radel collected comic books as a kid and he came up with the idea for Solution Man. John explained their early discussions on Solution Man, "You got a problem? Send it to Solution Man. If you can't find it, Solution Man can. The Super Hero of the Fastener Industry. We must have tossed around 100 different catch phrases once we got going".
What is particularly interesting about Solution Industries is that the entire company was launched without a product line. For that matter, it was launched without any inventory at all. Don explained, "We sent out our flyer with Solution Man on it asking distributors to send us their headache and hard to find items. If you can't find it, Solution Man Can! The only inventory we had was some of what John had from his previous company, and that was not a lot. Essentially, we started from nothing".
The early discussions about what they were going to sell were similar to the Sienfeld episode when George and Jerry tried to pitch their television program to network executives. "It's about NOTHING!" What's our product line? We have NONE. Nothing!! Create the concept and the products will come. And they did.
After a short period of time, Solution began to get requests for similar types of items from all over the country. Zinc Plated Sockets were the first product line that presented itself, vis-a-vis the numerous requests from distributors all around the country. Today, Solution carries a complete line of socket heads, button heads, stripper bolts, etc. in ROHS compliant zinc clear, zinc yellow and zinc black. Next, they saw an opprtunity to stock and sell Gr. 5 & Gr. 8 Fully Threaded Tap Bolts and that is a strong line for them today.
Another area that has evolved is "secondary operations". They drill, they patch, they plate and they supply the customer a completed part. Don said, "We are in one of the best locations in the nation for completing secondary operations and we do enough volume to keep our prices very competitive. Cleveland has numerous platers and patchers availabe. Almost every distributor we talk to hates sending out parts for secondary operations. They have multiple freight bills, multiple inspections, it is time consuming to have an expediter track the parts and if something goes wrong it seems everyone points the finger at someone else. You place an order with us, and we'll send it to you complete. If there is an issue with the part, we handle it. We can offer a tremedous cost saving to distributors who recognize all the hidden costs involved with secondary processing."
So, they are coming up on ten years in the business. Where do they go from here?
One of the reasons I enjoy visiting Solution Industries as much as I do is that Don Shan is an entrepreneur, plain and simple. His mind is working 24/7. When ever someone visits Don, he questions and prods to see how the visitor and Solution Industries can work together to do something better than either party could do alone. Like Michael Keaton in the movie "Night Shift", the ideas come flying at Shan and he spends time every day trying to determine how they fit in the fastener industry.
So, if you have any hard to find parts or any interest in just trying to approach the fastener industry in a new, creative way, you'll want to talk to Solution Industries. Dial 1-866-297-8656, and ask for Solution Man!!
NCFA Distributor Social, Panel Discussion
One question that came up was something like "how would an increase in domestic manufacturing by 25% affect your company and the domestic manufacturers of fasteners". It was something like that. Some panel members answered that it would be just great and they have additional capacity, etc. But Ray Gurnick of Seaway Bolt gave an answer that caught my attention. He basically said that if domestic manufacturing increased that much it would almost be frightening. He does not think the U.S. could absorb that much additional business because domestic manufacturing has been downsized so much.
One panel member suggested they were training new header operators and could get them up and functioning within six to eight months. After the panel discussion, I had some time to talk with Ray Gurnick and he said it would take more like two years to properly train a good operator. Ray said, "If I go out and spend $1MM on a new piece of machinery, there is no way I am letting a new headerman operate that machine in eight months. It's not happening. More like two years".
So, how long does it take a new trainee to get up and operating?? And does it depend upon the type of machine?
Many standard fastener products are being imported very inexpensively. And several panel members made comments about currency manipulation and raw material subsidies. All seemed to agree that these challenges exist in some capacity. So, if the standard fasteners are being sold cheaply, one would think domestic manufacturers would gravitate towards more difficult or "special" products. And, when you are manufacturing specials, you would need even more experienced operators. So it seems to me.
All panel members seemed to agree that prices from overseas seem to be rising as overseas wages increase. As the prices get closer, consumers begin to factor in lead times, shipping costs and other factors that make it more attractive to consider domestic manufacturers. Still, most admit that some of the lowest cost commodity items will never come back, or at least in the foreseeable future. Still, check out the Reshoring Initiative site more closely to get a better idea of the many factors that need to be considered when weighing domestic versus import fasteners.
I think Eric Dudas of Fully Threaded Radio said that Harry Moser was going to be his guest on an upcoming edition of Fully Threaded. Also worth noting is that panel member, Charlie Kerr of Kerr Lakeside will be on the next Fully Threaded broadcast following up and adding to the subjects covered at the Distributor Social.
North Coast Distributor Social - Great Event
The North Coast Fastener Distributor Social took place last night, June 7. I have attended the other past NCFA Socials and this one was again a great success. Each year they offer a twist to keep the event fresh. This year they held an hour long panel discussion on Domestic Fastener Manufacturing and the panel consisted of several Midwest manufacturers, several from right there in the Cleveland area.
The panel included:
Kerr Lakeside - Charlie Kerr
Telefast - Jeff Hepner
Dyson - Kelly Sawchick
Master Products - Jeff Walters
Seaway Bolt - Ray Gurnick
Lake Erie Products - Kevin Quinn
Ohio Nut & Bolt - Tim Morgan
Eric Dudas of Fully Threaded Radio (www.fullythreaded.com) and Fasteners Clearing House (www.fastenersclearinghouse.com) was the moderator and did a fantastic job. While Eric was not a panel member, he was able to interject many facts, figures and anecdotes from other panel discussions and radio interviews he has done. He kept the discussions flowing and just did an overall excellent job.
After the panel discussion came the Distributor Social where between 200-250 members from the industry gathered to network and share a drink or two. I laugh sometimes when people suggest that events like this or the Midwest Fastener Association's Fastener Bash are JUST social events. If that is what you think, well you are just flat out missing the point. There is a whole lot of business that is discussed at events like this, just as business also gets done on golf courses and ball games. This was no exception. I personally had some candid discussions with some influential industry people that I will not, and cannot print here. Cool, cool stuff. And I guarantee you, there is no way these discussions would have taken place had it not been for the Social. For the record...we were both stone cold sober. But, I will say that Old Rusty Bolt did make an appearance at the Social bar but could not be served because it had not been properly chilled.
The Social continues to be a great success due to the efforts of a lot of people from the NCFA. Volunteers are awesome. One thing I'd like to report that no one mentions is that, each year, Brighton Best has picked up the bar tab at the end of the night in support of the Distributor Social and the NCFA. They never ask to be recognized for this and George Hunt tells me every time I ask him about it that Brighton just thinks it is important to support the industry association. Folks, this is a group of fastener people. You know the types. And you know how they enjoy a cold beverage. We are not talking about a couple beers at a ball game and I just wanted to point that out because I think it is a terrific gesture on their behalf.
I'll probably blog again later about some observations from the panel discussion. The panel was impressive and had some interesting things to share. Truth is, I've got to get some work done. One last thing. Andy Graham of National Threaded Fasteners was taking pictures last night and I understand they will be posted on the North Coast Fastener Association Facebook page. For those of you on Facebook, go find their page and "like" it. More later.
MWFA Training Opportunities
Following up on my recent post regarding fastener training, Nancy Rich sent me the following information from the Mid-West Fastener Association. I wanted to post it now because I do think it is important for people to plan ahead and see what kinds of training programs are available.
Dear T.S.,
You are so right about the importance of Fastener Training in the industry. Attached is a brief write up on what we offered/offer this year. In the last three years we have seen all class enrollments increase as much as 50% indicating companies are taking the time to invest in their employees training. These programs are all very economical presenting a wealth of knowlege from first hand experience, industry trainers.
Mid-West Fastener Association to Offer Several Education Programs in 2012
Social Media
March 15
th Milwaukee, WI-Iron Horse HotelThis Seminar will feature
Dennis Dean and Greg Bennett of Dean Group Media. They will touch on many areas of social media and how your business can and should be using it to gain market share including: What is Social Media, Old vs. New Marketing, Marketing Spend Trends , Why Video? Effective Use of Videos, Does it Pay?, Top 10 Social Media Mavens, Case Studies-Wall Flowers Don’t Dance, Where to Start, Guidelines, Strategies, Social Networks vs. Social Media, and Social Media and Search Engine Optimizations. The days of ignoring social media, thinking it’s a short term fad, are gone!Intermediate Fasteners-Hand on Learning Class
April 19
th Elk Grove Village, ILThose who have been in the industry over three years or have taken the MWFA Introduction to Fasteners class will find this especially helpful. Doing business, in the fastener industry, requires knowledge that only industry experts can teach. This class is more technical than the Introduction to Fasteners class. Topics include: materials, screw machining, print reading, inspection, PPAPs, accreditation, secondary operations and more.
Safeguards Against Ordering Wrong Manufactured, Plated or Imported Parts to Minimizing Risks and Loss of Profits
June 25
th 10:00 a.m.-11:30 a.m. Addison, IL-Medinah BanquetsThis seminar is designed to assist those in purchasing as well as sales/purchasing communication. Miscommunication and errors can create costly mistakes. There is little room for error in today’s business environment. Industry personnel, from various aspects of the industry, will teach you important safeguards. This seminar includes and precedes the MWFA Table Top Show
Introduction to Fasteners
September 13
th Elk Grove Village, ILThe importance of educating those new to the industry is addressed in this seminar. Formal education will provide business education; however, fastener basics are best learned from peers and through hands on education. Topics included in this class include: making of a screw, nuts, washers, metrics, applications, prints, use of calipers and more. This class provides handouts, publications and samples for reference once back at the office.
What You Need to Know About Plating and Heat Treating
October 18
th-1:00 p.m.-5:00 p.m. Morgan Ohare & SWD, Addison-ILLearning about plating and heat treating can be very complex. With the assistance of onsite training, students will have the luxury of education through plant tour explanations. The class will be conducted at facilities with working plants where students will be instructed on metallurgy, zinc vs. zinc trivalent, overcoats, E –Coats and paints, importance of RoHS and Reach, passivation, conversion coatings, popular automotive platings, hydrogen embrittlement, baking of parts, the do’s and don’ts of strip and re-plating on various finishes and more.
Check for seminar and Fastener Information Directory details on our website: www.mwfa.net
Mid-West Fastener Association P. O. Box 5
Lake Zurich IL 60047
847-438-8338 Fax 847-438-7580 E-Mail: info@mwfa.net
Training is Vital to Compete and Survive!
In a recent post, I mentioned how regional organizations are so important to networking and training in our industry. The following was submitted by the Fastener Training Institute ® explaining some of the programs they offer. I am personally pleased to post this as I had the opportunity to participate in a seminar hosted by Bengt Blendulf back in....back in...let's just say a long time ago. Bengt, on the other hand, I'm sure is as yourng and spry as ever!
Economist Adam Beaulieu posted an entry on his blog recently advising company owners to “invest in your firm now in order to maximize your growth potential over the next 18 months and to prepare yourself for 2014.
Invest in efficiencies, training, customer satisfaction efforts, new products and new marketing efforts.” (http://itreconomics.com/blog/measure-of-reality)
The Fastener Training Institute ® has a full menu of employee training programs to help you maximize your company’s growth potential.
Advanced technical training
The Fastener Training Institute® (FTI) offers a variety of highly acclaimed advanced technical training programs throughout the U.S.
Our Certified Fastener Specialist™ advanced technical training program is offered in two different formats. Each of the seven classes is offered individually in Southern California beginning in April of each year. Or consider the intensive version of the program offered in Southern California in the winter and again in Cleveland (taught at IFI headquarters) in the summer. This year’s Fastener Training Week-Cleveland will take place July 23-27.
FTI also offers an advanced class on Automotive Fastener Technology, taught every spring in Troy, Michigan.
Customer training
Do your customers need more information about fastener technology? FTI has a class for that too. Bengt Blendulf offers a two-day seminar, Fastening Technology and Bolted/Screwed Joint Design, specifically to give OEM engineers a better understanding of the bolted joint. This course will be taught in Rosemont, Illinois June 6-7.
Product Training
This three-course program was designed to teach employees in the fastener industry about the products they buy, sell and warehouse. While it is intended for people new to the industry, it will be beneficial for all who want to expand their knowledge.
The curriculum for each class is different, focusing on different products and fastener industry information. Classes do not need to be taken in sequence. If a class is missed, it can be made up the following year. Upon completion of the program and passing a take-home exam, students receive an engraved plaque.
We also offer one-day condensed versions of the product training program, called Fastener Basics. These are scheduled for August 21 in Southern California and November 8 in Scottsdale, Arizona.
In-House Training
If you want in-house customized training, FTI can put together a curriculum that meets your needs and bring trainers to your facility.
Certified Fastener Specialist
To receive the CFS™ designation, students must complete seven full-day training programs offered throughout the year or the week-long intensive version and pass a final exam at the end of the training. Upon completion of the program, students receive an engraved plaque designating their certification as a fastener specialist, according to the requirements established by the Fastener Training Institute™.
Individual classes in the CFS series include:
* Fastener Manufacturing Plant Tour
* Fastener Secondary Processes Plant Tour
* Fastener Specifications & Terminology
* Understanding the Bolted Joint
* Dimensional & Material Specifications
* Fastener Quality Assurance
* Fastener Testing
More than 800 students have participated in the program since its inception. We now have nearly 300 graduates. Classes do not need to be taken in sequence. If a class is missed, it can be made up the following year. Classes are taught by recognized industry specialists and include every-day hands-on case studies and lots of real-life information.
Our Instructors
Bengt Blendulf was on faculty at Clemson University in the College of Engineering and Science until 1996, when he formed EduPro US, Inc. to focus on education and consulting in the area of fastening technology and bolted/screwed joint design. He is a founding member and formerly served as chairman of the Bolting Technology Council (now ASTM F16.96 Bolting Technology). Educated in Sweden (mechanical engineering), Mr. Blendulf moved to the U.S. in 1974 to start a subsidiary for a leading European fastener manufacturer. He is the author of more than 100 technical papers in addition to published articles related to fasteners and international standardization.
Salim Brahimi is president of IBECA Technologies, a consulting firm that provides engineering and business process improvement services. He is a licensed member of the Quebec Order of Professional Engineers and is an active voting member of numerous ASTM, SAE, IFI, and ISO standards and technical committees. In May 2004, he was awarded the Fred F. Weingruber Award, bestowed by ASTM Committee F16 for his outstanding contributions to the development of fastener standards, especially in the field of hydrogen embrittlement. Mr. Brahimi is also currently completing a doctorate at McGill University in Montreal on the topic of fastener hydrogen embrittlement.
Joe Greenslade is Director of Engineering Technology for the Industrial Fasteners Institute (IFI). He has served in many capacities in the fastener industry since 1970 and has written more than 300 technical articles for fastener trade journals. Mr. Greenslade serves on all of the fastener standards organization committees for the American Society of Mechanical Engineers, the American Society for Materials and Testing, SAE, and ISO. He also served as the technical representative for fastener distributors on the Fastener Quality Act Task Force that worked with the federal government during the creation of the FQA.
Carmen Vertullo CFS is the founder of CarVer Consulting, a San Diego-based consulting, engineering and training company specializing in fasteners and bolted joints. He has experience in fastener quality assurance, manufacturing, sales, and inventory management programs. He has developed and teaches a series of advanced fastener training classes for the Fastener Training Institute®. Mr. Vertullo is a Certified Fastener Specialist through FTI, and he holds a BS in Manufacturing Engineering Technology from National University, San Diego, CA.
The Fastener Training Institute®’s core purpose is to enhance fastener use, safety and reliability.
For more information about the Fastener Training Institute® and its programs, visit www.fastenertraining.org
Planes, Trains, and Automobiles – One Distributor’s Fastener Fair Hannover Experience
Dave Audia of Advance Components recently traveled to the Hannover Fastener Fair and, as one Traveling Salesman to another, I asked him to share with us some of his experience and observations. Dave was kind enough to be a guest blogger and submit the following:
As a pure master stocking distributor of specialty fasteners, Advance Components is always looking for new ways to grow our business. We had noticed a small yet intriguing group of customers in Europe who were buying some of our products and having us ship them across the pond. We considered going to individually visit these customers to explore what other opportunities may exist but considered that to be an inefficient option. We researched the many Fastener Fairs that exist around the globe and decided to purchase a “stand” and exhibit at the 2012 Fastener Fair Hannover in Germany.
After a refreshing combination of 2 flights from Cleveland thru Newark totaling 9hrs 47min plus a 2 hour layover, I hit the ground in Zurich Switzerland to meet my boss (who had flown in from Texas) in need of a shower and a nap – of course we got neither as it was already 8am Saturday morning and our hotel would not be ready until later that afternoon. I had never been to Europe and I must say the city of Zurich and its architecture were absolutely stunning – we spent all day Saturday and half a day Sunday exploring the area and just when we had finally figured out their bus system it was time to leave.
The more business you can fit in on a trip like this the better and we were fortunate enough to be able to set up a visit at A Raymond Tinnerman’s manufacturing facilities in southern Germany. We took a train from Basel to Lorrach on Sunday night arriving just in time to miss dinner as all restaurants in this small German city were closed – fortunately our hotel manager was able to order us a pizza which we ate at the lobby bar (which was closed by the way). So much for European cuisine!
Monday morning we had excellent visits at 2 of A Raymond Tinnerman’s plants as well as promising conversations about new products and markets that we should be able to participate in with them – then it was back to the train station for a 5+ hour train ride north to Hannover – we arrived after 8pm and had to rent a car to drive 45 minutes to our hotel. Note: if you don’t know how to drive a standard transmission specify that BEFORE you rent the car – and a GPS that speaks only German is kinda useless. We finally reached our hotel well after 10pm, ate subs purchased at the train station for dinner - again in the lobby - and hit the hay in preparation of the big show for the next 3 days.
The show itself was a tremendous learning experience for us. What I did not realize is how drastically the people and business cultures differ from country to country in Europe. We were able to meet with several of our current customers who were also attending the show, including Earnest Machine who helped us out considerably as they have both a US and European presence. We were pleasantly surprised at the interest from both the show attendees and the exhibitors in the products that we displayed, but the fact that we currently have no warehouse or sales presence currently in Europe will be a barrier to overcome. But you don’t learn and grow by sitting in your ivory towers right???
After 3 full days of the show it was back to train station for another 2+ hour train to Frankfurt on Thursday night, then back to the airport early Friday morning for the long flights home ( I won’t bore you with the details of having to be evacuated from Newark airport before finally catching the plane home). But to end on a serious note, there were over 30 countries exhibiting at the show that included several German and Italian companies, excellent representation from the US as well as China, Taiwan and India. There were also companies from Turkey, Great Britain, France and the Netherlands. We learned a lot, have several leads that we continue to follow up on, and own a much better understanding and respect for what it takes to succeed in the global market. I would also be happy to discuss further or try to answer any questions that you might have concerning this experience. My e-mail address is daudia@advancecomponents.com.
Future of the Fastener Industry
April gave out a lot of mixed signals. A lot of people I spoke with about April shared with me that April was not bad but a little bit flat. For instance, I spoke with someone from Fastenal who confided that while year-to-year growth in April was still impressively high for the company, the rate of growth over 2011 was down from the previous months. April was good, but not as good. And I have heard that from many other places I visited. Sure, there were plenty of companies that had crazy good Aprils, but from what I can see that was more an exception.
Further supporting this notion are the results from the Fastener Distributor Index (FDI) as reported by Holden Lewis of BB&T Capital Markets in his newsletter dated May 2, 2012. Specifically, the report read "April's reading suggests more tepid growth to begin Q2'12" and then later "Why april was not so robust is hard to say". To learn more about the Fastener Distributor Index go to http://www.fdisurvey.com.
So, what is in store for the immediate future of the fastener industry? Does May seem better? I think so. And I still think the rest of the year will be strong. I just think that 2011 seemed busy everywhere I went and this year is not as consistently robust. Another question asked in the FDI questionnaire was something like "What will the economy look like in six months" and 70% of respondents said it would look better than it does today.
But what about longer term? Where is the industry headed? The Holden Lewis interview on Fully Threaded Radio was very interesting, so much so that I was taking notes while I drove. No driving and texting, just some casual note taking and mostly on uncrowded highway miles. The comment that caught my attention most was the idea that distribution was a "lifestyle business". In more detail, Lewis suggested that, historically, distribution was a great cash business that could "provide a living", "send the kids to college", let one "take a few vacations" and "earn a living". And then he suggested that, increasingly, the business is moving away from that as distribution consolidates and moves more towards cost cutting and increasing of services. Lewis, made several comments about Fastenal installing over 10,000 vending machines in customer locations. This information was reported by other news sources where it was also noted that the rate of new store openings has reduced in recent years. I have had an opportunity to see the Fastenal vending machines and they come in all sizes. They have vending machines that remind one of their high school gym locker (open it up and you could fit a power tool or 1/4 keg) and others that are smaller and look like old gum dispensers which they can use to monitor the expensive cutting tool inventory at a customer. And they have every size of vending machine in between. I mentioned Holden's comments because he was responding to a recent question about how fastener companies are investing in order to grow. Many companies are adding sales people, while others, like Fastenal, are investing in new technologies. But, does that mean we are moving away from the old family run fastener distribution business?
It is an interesting question. Clearly, when I started in this business some 25+ years ago, there were a lot more small distributors popping up on a fairly regular basis. Some outside salesman would get hassled by his boss about not turning in his expenses properly and BOOM!! there would be a new fastener distributor running out of a garage with a new name and and old face. That does not happen nearly as much anymore. But, will small Mom & Pop distributors just go away in 10-15 years?
I think vending machines are going to make a huge impact on MRO accounts. No more throwing gloves away at coffee breaks and no more battery tools slipping out the back door at Christmas time. The vending machines track everything and the user I.D. lets the company know just where the stuff is going and who is taking it. But, will kegs and kegs of bolts really ever end up in vending machines? I don't know. Maybe, but I don't see that yet. Furthermore, I just do not see fastener specials falling into a category where a vending machine dispenser is the way to go. That is why I love "specials". Better margin, more value and you just cannot replace them as quickly. "Son, let me tell you...the future of fasteners is in SPECIALS!!"
While I cannot pull out my crystal ball and give you a real good idea of what the fastener future might look like, I can offer a few ideas here and there and at least start up some conversations. And for today, there is still a lot going on within the industry. Out in the midwest there is a lot of talk about two upcoming events: The North Coast Fastener Association's Distributor Social and the Mid West Fastener Association Fastener Show. Both will take place in June and are right around the corner. The regional fastener associations are so important to promoting great networking opportunities and educational programs. Also, I am proud to say I have booked my Vegas flight and made hotel reservations for the show in October. Two non-stop flights and a hotel rate that suits the budget of a thrifty Traveling Salesman. So, I'll just go about my business with both eyes wide open but feeling OK that the fastener distribution marketplace will not change SO quickly that I get caught off guard. But, it is always wise to read, listen and blog about what is happening so we move forward with as much knowledge as possible.
Changes at NFDA
All American Fastener Show 2013
Just was included on a private note from Heidi Voltrauer and thought I would share it below. Looks like the All American Fastener Show is on again in 2013!
Hey guys,
I just wanted to let you know the good news! The All American Fastener Show will be held in Kansas City, MO in the Intercontinental Hotel at the Plaza and it looks amazing. I went to visit the hotel and area last week and I am very impressed. The show dates will be May 8-9, 2013 with rooms available on the 7th as well. Golf tournament will be the 8th along with set up and fastener bash that evening. The 9th will be the show with a lunch available and a presentation on social media. The website is in the process of updates and it will be up and going very soon! Take a look at kansascityic.com for more information about the venue.
Thanks,
Heidi Volltrauer
All American Fastener Show
Alert! www.amazonsupply.com
I have heard mixed reviews so far about the product offering, the pricing, etc. Candidly, I think all that talk might be missing the point completely. Search Engine Optimization is critical to so many industries and I just wonder how Amazon will stack up against the other online giants like Grainger and Fastenal. A couple years ago I did google searches for a lot of different fastener products and I posted which company came up for each category. I noted the top results for cap screws, rivets, socket heads, stainless, etc. A few years ago these companies did not dominate the searches like the can today. I am not AT ALL an authority on these subjects but, I wonder, if at some point when you look for a fastener item will the top name for the search continuously be a company like amazonsupply.com?
Some will smugly sit back and say "Amazon knows nothing about fasteners" and, compared to many fastener distributors that might be true. Fastener distributors that add value will always thrive. But if some random engineer or OEM buyer is looking for "some parts" and uses the internet to search for those parts, the guy that does not really know fasteners might win out anyways.
I imagine there are people out there that know a lot more about amazonsupply.com than I do. Please, join in this discussion. For one thing, where is their product coming from? Is it all drop shipped??
This could be an industry game changer. Part of me really wanted to hold off writing about this until I had more information. On the other hand, I hope this post will encourage others with more knowledge to add what they know and share with the industry.
The 4-Hour Workweek?
I am sure there are some people who have read this book and figured out a way to reduce their workweek down to 4 hours. I'm not sure really but, I suspect it could be the case. More intriguing to me is the fact that Ferriss is just an outstanding source for online business solutions and opportunities and he writes about many of them in his book. There are countless sites he uses to market his products, to test his sales promotions for effectiveness, to reduce his administrative obligations, to...well, to run his company while he travels around the world. And, while I think I would personally have a bit of a hard time adopting all the ideas he presents, many of them would certainly be adaptable to my mundane fastener business.
Not only does he reference countless internet sites dealing with everything from drop shipping products to site analytics to having virtual receptionists to free sources of information to setting up domains and on and on and on... he also recommends many books. Everything from "80/20 Principle" by Richard Koch and the "Secrets of Power Negotiations" by Roger Dawson to "Six Months Off: How to plan, negotiate and take the break you need without burning bridges or going broke". Good luck with the last one.
I am not real confident that many people read the book and actually then proceed to work 4 hours a week and maintain their current (or better) standard of living, but their is a gold mine of interesting ideas on how one can better run certain parts of their business.
Recently, I was told by my brother about a company he used called oDesk. Google it and you will see that you can outsource all kinds of jobs that you might not be good at. Within days of him mentioning it, I read about the same internet based company in a Kiplinger newsletter. So, I thought I'd walk the walk and not just talk the talk and I signed up, posted a job and said that I was looking for a graphic designer to create a new logo for my company. When you post, you tell them how much you are willing to pay for that service and what you are looking for. I received 20 responses, or proposals, from people all over the world who have graphic art skills. Many of them send samples of their previous work and they tell you how much they would charge you to do the work, whether it is more, or less, than you offered. I did choose one applicant based upon his previous work. Many of the other samples I received were very artistic but this one gentleman's work had sort of an "industrial" style to it which I thought was good for the fastener industry. Not colorful and flowing but more of a nuts & bolts type of feel. Within a week I had several samples sent to me and I asked for a few small alterations and he responded. It was actually pretty awesome. My new graphic designer, Sergiu, lives in Sibiu, Romania, so I guess you could kind of say my company is now international.
This was a simple task to outsource and not one that needed to get done right away. I just wanted to try this out and it worked well. I'd really like to spend some time updating this blog site but I'm a bit afraid of screwing it up totally. So, I've dipped my foot into the water and we'll see where it goes from here. As I always encourage, you just gotta try something sometimes and see where it leads.
U.S. Fastener Report
For one thing, the price is right. I don't have to pay for it. And, I looked it up on my IPad as well as my computer and was able to scroll through the report very easily. But what hooked me was page 25. The title on that page is "Wha'Cha Think'?" To tell you what the page is about I will copy here the description of the page:
"This column is about ideas and concepts in the fastener industry to start some conversations among you and your co-workers, friends in the industry, and associates at trade show and fastener association meetings. These are topics that come across my desk day-to-day from fastener distributors, fastener manufacturers, importers and master distributors."
I'll just list a couple here to give you some examples:
1. Is your freight department a profit center?
2. How should you react to a "price war"?
6. If your competitor posts negative comments on social media about your company, how should you react?
14. What are the best "advertising specialty items"u have ever given out, or received, and to they produce any results.
I have an awesome answer for #14 but I'm not sure I will share it here. Trade secret!
Anyways, this is just one page from the report. The whole report is very good and I even think I will take the fastener quiz this time.
For the record, I have nothing to do with this report. It is produced by Mike McGuire and he will read this post because he is a fastener info sponge and keeps a pulse on everything going on. Early on when I started Fastenerblog.net, I told Mike someone like him or another fastener magazine editor should have started this. Kindly, Mike has supported this site and I appreciate that. The truth be told, I would like to put this edition of "What'Cha Thnikin?" on this site and see if anyone responds to the questions. I get a lot of personal notes after I post something and I often wonder why people to not respond on the site. I wonder, but I do not lose sleep over it. The questions posed on P. 25 of U.S. Fastener Report belong on a blog page where they can be discussed and responded to. Maybe the belong on LinkedIn or Facebook or the like. But, I also think this site would serve the same purpose. That being said, I would feel a little awkward just "heisting" Mike's article as I think it is very good, it is valuable and it asks some good questions. So, feel free to subscribe to U.S. Fastener Report and then come back here and we can discuss the topics.
All that being said, I think this is a nice addition to the fastener industry publications.
Final quick note. I get asked often how I see things in the fastener marketplace. Last year, everyone was busy all year. That is how it seemed to me. This year, things are still pretty good but as I travel I do encounter distributors that say stuff like "business is pretty good. We were a little slow the end of last month but it seems to be picking up again." Lots of comments that suggest things are still good but not busy every single day. End result though, it does seems as though things are still pretty good.
What's up in your world?
Trade Show Locations
It seemed like a lot of industry people were on the road last week. There were a lot of Tweets from the PacWest meeting in San Francisco and also a lot from Houston, the location of the Southwest Fastener Show. Just about a week before that I received notice the the All American Fastener Show had to be canceled for this year due to tornado damages at the hotel where the show had been hosted the last few years. While I did enjoy the Shows in Branson, I look forward to attending the one in 2013 at the new location, wherever that ends up being.
If you are a STAFDA attendee then you know that the show moves from city to city each year. NFDA also moves their meetings regularly. I think the NIFS show has pretty much nailed down the best location in the nation for its trade show although even they have moved the show up and down the trip. But, no matter what your taste is in entertainment, you can always find something to do in Vegas.
For me, I like to attend the Mid-West Fastener Show whether it is the table top show or the Fastener Tech show. Chicago is pretty much the Industrial Fastener Mecca and so many suppliers and manufacturers are located there that it seems like a natural place for a national show. Lots to do and plenty of great places to eat and eat and eat.
Because the All American Fastener Show has suggested that it was looking to hold the 2013 show somewhere other than Branson, it made me wonder - where would be another great location for a fastener show. I think Heidi is pretty committed to holding the show in the central area of the U.S., and that's a fine idea. But, if someone were trying to decide where would be a great place to attract the most fastener industry people, where would that be?
Before you answer, remember that Columbus, Ohio was that place for a couple decades.
I'm going to toss this out as a topic for #fastlink Friday for all you Tweeters. And, if you are not on Twitter, you should be.
Changes in Importing Fasteners
"The fastener buzz these days seems to be re-shoring. While I believe it would be fantastic for our economy and make my job a lot easier, I don’t think even small distributors like me will completely stop importing. After 20+ years of working with Asia, I know it’s not difficult to develop sources that are willing to work with smaller volumes and that allows us little guys to remain competitive. But the market has definitely changed post-HTI. Handling fees that used to be waived are now being enforced. Quote turn-around time has increased. Suppliers are not following up on quotes. There was a time when you could email a quote, have a response in 24 hours and have a follow up in 48-72 hours asking for the order. It is strangely quiet these days. " --- Janet Schiopota, Senior Manager, Procurement - Great Lakes Fasteners Inc./ CMI Industries Inc.
I found Janet's note interesting for many reasons. Sure re-shoring would be great for fastener distributors, even if the fasteners themselves are still imported. If more things other than fasteners are made here it is good for anyone supplying parts or MRO materials to the manufacturers.
More interesting to me was her comment that she has seen a change in how she is being treated by her Asian sources. As she noted, Janet has imported products from Asia for over 20 years, some of the time importing fasteners and part of the time importing other non-fastener products. She is suggesting that she has seen a change ever since Heads & Threads went out of business. It makes sense that Asian suppliers would be more careful with companies importing fasteners because if a concern as large as HTI could fail, what would keep smaller companies from failing? I suppose there could be many reasons why she is having longer turn-around time on quotes, more handling fees, etc. If business is brisk, that could be a reason.
Are other small or medium sized companies experiencing a change with their dealing with overseas suppliers?
I remember when Heads went out of business, an experienced importer friend of mine warned that the Asian suppliers were going to have to make up their losses somewhere. You don't just say "oh well" when you do not get paid for large amounts of product. Either prices go up or fees go up or credit is restricted or companies just get a lot more careful about how they do business. SOMEBODY lost money, and probably a lot of it. But this note from Janet was the first time a smaller/medium sized company directly suggested that she noticed the change post-HTI and I was curious to hear from others out there if they have noticed the same.
Why Tweet?
I've got an older brother. Coached high school sports, kind of acted line a teenager his whole life so it is no surprise he was a good coach. He could kind of relate to the mentality of the players he coached. He was not such a good husband because, frankly, he thought (and still does) like a teenager in many ways. He was 5-night-a-week-softball-guy. Those kind of guys are great buddies. Not always great husbands.
He is also the "I'm not doing THAT" kind of guy. "I don't Toot or Tweet, I don't Facebook, I don't do LinkedIn, I don't do any of that crap" he says with great Guy Pride. This is the guy that fought using e-mail and did not want someone to be able to reach him whenever they wanted...so you can imagine his reluctance to getting a cell phone, let alone texting. He has fought it all.
He now has a cell phone, he has added texting, he has a LinkedIn account and continuously is shown family related Facebook posts by his children. Believe it or not, he would really enjoy a Twitter account if he wasn't...well, if he wasn't HIM.
Why would he enjoy a Twitter account? Because every news agency in the modern world is posting the latest information on any given subject the minute it happens. If you are a sports junkie (which my brother is), there are countless local and national commentators Tweeting about sporting events the minute they happen. Or, you can follow the good columnists and they post information daily with their opinions and observations.
If you are into technology I am sure there are plenty of technology Tweeters to follow. Fill in the blank. For anything that interests you, there are numerous people flooding Twitter with interesting links to articles or quick commentaries on a subject.
That being said, I really do not care if you are on Twitter or if you like it. I do not hold stock in Twitter and I gain nothing if you are, or are not, on Twitter. It does not change my life one bit.
We have been experimenting with #fastlink Friday and I think it has gone pretty well. But, like anything new, it is kind of a mystery still how Twitter can be used by the fastener industry. I know that young people today use it A LOT to communicate with their friends and different groups. And, tomorrow those young people will be working in our industry because there's a whole bunch of old people working in it right now (except for at Fastenal who has cornered the market on young people in the fastener industry). Maybe a use for Twitter in the fastener industry will present itself, more than I have been able to observe so far. Then again, maybe not.
I just look at our industry and I see a good many people who remind me of my brother. "We don't ship after 3:00." "You didn't meet our $75 minimum and our accountant told us we lose money on every transaction under $75". ""If you don't do $2,000 with us, we cannot serve you". "We're not a plater. NO, we will not quote it complete." "We only ship in our boxes". "We cannot do EDI". "We need a hard copy of an order before we will ship it". "We have one e-mail account that all e-mails go into to. Just send it and I'll get it". If I tried, I could come up with 50 more objections I have heard. Often, new companies or competitors gain business from their competition by saying "I'll break a box and ship in a plain box with your part number and provide a packing slip with your name and it is fine that it is just a $45 order because, by the end of the year, I will have gotten in the door and might get a piece of that $200,000 spend you do in my product line".
Sometimes you have to bend a rule, or drive a part out to a customer who is two hours away. Sometimes you have to make something happen to keep a customer happy. You have to earn loyalty.
Sometimes you have to try something different. A few years ago, a distributor customer of mine brought in the son of the manager to work at the company. When he was given a standard cell phone he objected and said the phone was too basic and was not really good for conducting business. It was explained to him (by the older managers) that this was standard issue technology but he argued, "If you get me a smart phone I'll be able to answer e-mails and look at spreadsheets. Also, I will be available to you 24-7 as my generation does not turn off their cell phones even after 5:00 or on weekends". He got the smart phone and so did the rest of the managers once they saw what he was able to do with a smart phone. That was only like 3 or 4 years ago. Does anybody out there now not have an IPhone or Droid or Blackberry?
Companies used to mail out flyers and advertise their products in magazines. Still do. Eventually, companies started to fax advertisements out to customers. Eventually, the e-mail blast became the thing to do. We have an industry Podcast (Fully Threaded Radio) with fastener company commercials. I recently received a note from a rep friend who was watching business news and told me he saw a commercial from Aztech Locknut! Crazy. Grainger advertises regularly on radio stations in my home town and Fastenal (and probably others) advertise on race cars. It takes all kinds of creativity to sell a fastener.
So, why Tweet? I don't know. Why fax, why e-mail, why text? Because we can! And to the Victor go the Spoils!
#fastlink Friday, Part 2
#fastlink Feedback
Here's a quick post on our attempt to get fastener people involved in using Twitter. We posted a blog and sent out some Tweets asking Twitter users to use the hashtag #fastlink so we could try to get a feel for how many people in the fastener industry are using Twitter. We tried doing this on Friday, March 6. Here are some of the results.
Using a site called HashTracking.com, we were able to generate a report that showed there were 138 Tweets generated that included #fastlink. This report gives you data for only a 24 hour period. Specifically, the report said: "138 tweets generated 44,830 impressions, reaching an audience of 22,935 followers within the past 24 hours".
I tried counting how many different Tweeters were involved in #fastlink Friday and I think there were 45 of us.
I'm not sure what the Hashtracking.com report is referring to when it says that "44,830 impressions reached 22,935 followers". Clearly, 22,935 people were not Tweeting about fasteners. Maybe someone can provide some more insight on this data.
I did meet link up with some people through #fastlink Friday that I did not know before. Now I am following several new Tweeters. I cannot tell you that these new connections will lead to me adding new customers or new suppliers but I did link up with a few more people who are interested in the fastener industry. That is good for something, I suppose.
It is interesting to see who is on Twitter. Some of the industry magazines and online news organizations were involved in #fastlink Friday, while others were not. Honestly, I would think every industry media source would be involved on Facebook, LinkedIn and, yes, Twitter just to keep on the cutting edge. Several of the regional fastener organizations were involved as was a representative from NFDA. The WIFI group participated, the domestic fastener show groups did not but then a representative from Fastener Fairs took time to Tweet and promote the upcoming show in Hannover, Germany. Several importers checked in but not all of them. I checked and there is at least one major importer without even a Twitter account, as far as I could see.
Please feel free to comment if you were involved in #fastlink Friday. I have already had suggestions that we do this every Friday so that those who are not actively involved will at least check their accounts once a week. Again, all new and creative ideas are welcome.