Going Local in a Big Box World

Ace Hardware Corp., a 90-year-old co-op that oversees nearly 5,000 locally owned hardware stores, never would be mistaken for trendy. But its recent growth proves that everything old eventually becomes fashionable again.

“We are a service-based, high-touch, local business,” says John Venhuizen, CEO of the Oak Brook-based chain. “The shop-local trend is one that has served us well.”

Does this sound familiar to you? You might be a "service-based, high-touch, local business" as well. 

Ace always has focused on modest stores. Its average footprint is about 8,000 square feet, a mere couple of aisles in a typical 100,000-square-foot Home Depot. Lower overhead helped propel Ace to record profit and sales . Net income increased almost 28 percent to $104.5 million as revenue rose 8 percent to $4.15 billion. But while small may be beautiful, it's still small. For perspective, Home Depot Inc. rings up more every three weeks, on average, than Ace does in an entire year.

Mr. Venhuizen nevertheless likes his position. An Ace lifer who was promoted to CEO in April 2013 from chief operating officer, Mr. Venhuizen, 44, grants that Home Depot, Lowe's and Amazon.com Inc. “are very good at what they do” but says Ace has managed to stand out by offering personalized advice.

Be a standout by offering personalized and industry specific knowledge

In fact, he says, Ace has chosen to leave more intensive renovation-related sales to the goliaths so that it can serve the homeowner with weekend “honey do” projects. “Even when the economy was bad, you may not have wanted to put 55 grand into granite countertops, but 20 bucks for a can of paint to spruce up your kitchen? Sure,” he says. “And I don't think they're going to create an app where taking care of your home isn't cool anymore.”

Jeremy Melnick, a third-generation Ace owner who runs six stores in metro Chicago, concurs: “Weber grills are going to be the same price at our store or on Amazon,” he says. “The difference is that we deliver and put them together. You need to see a paint swatch in person, and you're not going to get a key cut from Amazon.”


Mr. Venhuizen's challenge, then, is to find ways to expand in his niche.
So to is your challenge? How can you innovate and expand your sales?

One suggestion might be that your leverage a software system that is tailored to your industry.
the MDS-Nx system has the tools to help you customize your sales environment for your specific customer's

Anyone can buy a box of  gloves online. But they won't know the tensile strength or what percentage of latex, or the ones that Dr. Stover prefers.
All of that can change the value of your sales model and let you be the local supplier with better knowledge and understanding.

Sell the value you have and use tools specifically designed to do just that.

Take advantage of this local trend to build your relationships and increase your value to your customers.

For more information on TSH or MDS call The Systems House, Inc. at 1-800- MDS-5556. Or send a message to sales@tshinc.com

Click here and tell us how we can help you with your business solutions.

Turn those customers into salesmen..

using Customers to generate REFERRALS

How can you generate more referral business?
This is not really about the death of a salesman, but in some ways the traditional sales methods are changing and while salesman are still needed, You still still need to look at other methods to build that sales funnel. 

Referrals are becoming a primary mechanism for how we make decisions.

A 2012 Nielsen study found that 92% of consumers trust word-of-mouth or recommendations from friends and family above all other forms of advertising. A Texas Tech study found that 83% of consumers are willing to refer after a positive experience—yet only 29% actually do.

How can you take advantage of the opportunity to close that gap?
How do you get a referral engine going?

1. Get connected.

Find a way to get and stay connected with people you meet. People who are interested in your work, people who you’re interested in, people you can help — they’re all valuable relationships and it’s never been easier to stay connected.

Look at social media, LinkedIn is the premier business networking tool and while I am not selling it, there is no question it's a great tool to make connections.  Join for free and start linking people together you might be surprised how small the world is. (I am...) And once your see connections, ask your connections to make and introduction. 

2. Make your own referrals.

Referrals are a two-way street. Look for every opportunity to help, connect and support people in your network. How can you give value first? Get proactive about making your own referrals, without expecting anything in return.

It’s very rewarding to connect other people and watch the results. I look for every opportunity to reward my long-term vendor partners with referral business. Making referrals helps everyone succeed. If you are genuine about making connections and not always looking at how it will profit you short term, then it will come back. It's not a karma thing it's a common sense thing. 

3. Stay top-of-mind.

This is the new sales challenge: How can you stay relevant to someone else so they think of you first when the time is right? If you meet someone at an event, connect on social media, then never communicate again, how valuable is that connection three years later? Timing is everything and the strength of a new connection diminishes over time if you don’t nurture it.

To stay top-of-mind, you have to be strategic about providing value. For me, blogging is the best way to consistently add value. Every week, my connections have the opportunity to see articles from me on LinkedIn, Facebook and Twitter. Blogging helps me stay relevant and produce new connections, conversations, introductions and closed sales.

But you don’t need a blog to contribute. Share information that you think your connections will find relevant and helpful. Create mutually beneficial connections. The key is to consistently contribute and look for ways to add value.


If you were wondering where to get content - our RemoteNet Web Tools allow you to automate your social media presence. So you don't have to manage the content and your latest product offerings, Top Sellers etc will automatically post to your social media feeds and drive traffic to your website.

4. Ask.

Asking for referrals can be powerful, but to get results, you have to earn the referral.

The key is to give value first, without expecting anything in return. If you’re working with a customer, deliver more than expected. Create reasons for them to want to reciprocate and help you. When your work is great, people are inclined to share!

People are also more inclined to help when they trust the relationship. Instead of leading with the ask, earn the right to ask for a referral over time. You’re much more likely to get a result. I’ve found that so many people want to help — and are more than willing when asked. You just have to create the right conditions.

Here’s an example from noted keynote speaker Ryan Estis . 

During a recent event I shared a story about one of my customers. After the keynote, a woman who was in the audience introduced herself to me, handed me her card, and immediately asked for an introduction to that company’s CEO. That puts me in a tough spot. I don’t know anything about her or her business, but she’s asked me to leverage my relationship with a client and friend. It wasn’t a great ask — she didn’t earn it.A better way to ask for the referral: Give first. Think about what a different situation that would have been if she had introduced herself, made the connection with me, and then followed up by delivering value. What if she’d sent me a package a week later with sample products and a handwritten note, referencing my keynote? She would have advanced the relationship, and I would have been more inclined to help.

Networking proactively takes time but it makes sales easier. Reputation and relationships precede referrals, and that’s exactly why investing time in helping others and expanding your network is always time well spent.

For more information on TSH or MDS call The Systems House, Inc. at 1-800- MDS-5556. Or send a message to sales@tshinc.com

Click here and tell us how we can help you with your business solutions.

The Business Balancing Act...

It's a balancing act, focusing on smaller orders with higher profits while keeping your larger customers happy.

"When you look at the speed of change and the level of uncertainty, specifically when you look at things like omnichannel and e-commerce, growth rates are hard to predict. " 

That overwhelming emphasis on speed, though, means that fast and accurate communication between you and your customer is crucial. Google, Amazon and others are delivering in under an hour, but they are getting paid more for the products and services they provide. This added profit cones either in the form of a subscription service like Amazon Prime or just higher prices on items with smaller delivery windows. 

"As omnichannel becomes more prevalent, that's driving a lot of pressure in the DC/warehouse  environment. A lot of distribution networks can handle delivery for B2B and classic commerce. But there are many companies who don't have the internal expertise or right infrastructure to handle omnichannel. It takes a different type of operation for picking, packing, and shipping direct to consumer. We've seen a lot of people take that portion of their operations as they move into the multichannel arena and outsource to a 3PL." 

But as with anything there are pro's and cons when using a third party.

Those same challenges make close integration between customer and 3PL systems imperative. When you are operating that much faster and going to direct-to-consumer fulfillment, you have to look at how you handle that integration. The question of how many 3PL partners a shipper might have aside, the fact remains that working with one of more 3PLs adds a level of complexity to tracking and managing your goods. 

So what can distributors do to make the process as seamless as possible?

The good news is that the MDS-Nx software suite has a number of tools to help you segregate and service that business more efficiently and in some instances allow you to handle this new volume in a more cost effective manner then shipping it off to a 3PL. or Use the 3PL as an adjunct or overflow for your volume. 

So as the new year starts and you look at new business models and ideas to grow your company here are four easy methods you can implement to service that business using MDS-Nx. 

Multi-Warehouse shipping based upon customer profiles
Bulk Picking for single line orders. 
Split Orders lines to create bulk and LUM picks
Split Shipping for multiple orders/Drop ship on the fly 

Multi warehouse shipping doesn't have to mean opening up a new branch or created a new physical space. It can be as simple as segregation an area of your warehouse for the items you will be breaking down to eaches. 

when customers place and order through your retail website those customers can be tagged as retail and have the order directed to the retail warehouse which is logically setup to ship eaches in smaller boxes.

For those customers who are setup a retail the number of lines tends to be much smaller. Industry averages are under 5 lines per order. To assist in shipping and picking - setup a Bulk Pick Sheet which allow you to list say 50  orders lines together with the same item - then pick the 50 pieces in bulk and move them to an assembly area where you can then easily box them and scan them for shipment - this will save the time going back and forth to the warehouse location and will allow you setup a packing operation based upon the items size and weight. 

In the instances where certain items don't fit your order profiles IE they ordered 4 small each items and one larger case. you can have the MDS-Nx system automatically split those lines into seperate tickets. 

In a larger warehouse the forklift might be needed to get to that case of gloves so the second ticket will go to that pickers handheld. and they can bring the case to the pick area. Or you can simply have one person pulling Bulk items after the other items are picked. By having two separate workflows once for bulk and one for piece you can 

increase productivity on both lines. 

Lastly when all else fails - you can still use that 3PL or the Manufacturer Direct by splitting the order in customer services based upon inventory and shipping times.. This will allow you to take a single line and have it ship directly from your 3PL partner or the Manufacturer but still keep the billing order under your control. 

The turnaround time might be smaller but the concepts are still the same. 

Using the tools you have available now you can service omni channel business more effectively and chose to take advantage of this new profit area. 

For more information on TSH or MDS call The Systems House, Inc. at 1-800- MDS-5556. Or send a message to sales@tshinc.com

Click here and tell us how we can help you with your business solutions.