Learning From A Recession

Most industries are shouldering the effects of the recession and the jan/san industry is no exception. However, while companies scrape by, the lessons learned from the crisis is leaving jan/san distributors with sound business principles for the future.

For instance, distributors like Jim Breen, vice president of operations for Lenexa, Kan.,-based Regal Distribution Co., Inc., notices a stronger conviction throughout his entire company to come in under budget.

“We had purchasing meetings in the past and if someone was $200 over budget, you wouldn’t research it,” he says. “When things get tight you have to explain that $200. It forces your company to watch budget lines and other things within the organization that you wouldn’t normally watch.”

To meet budget constraints, distributors have re-tooled certain operations, such as the delivery department of their business.

Regal reevaluated its delivery routes several months ago to become more efficient, says Breen. Along with changing routes, Regal requires its drivers to shut off the delivery trucks at deliveries instead of letting them idle. The company took these preventative measures to reduce fuel costs and save wear and tear on its trucks.

To improve their traveling efficiency, other companies like D G Bryan Commercial Cleaning Equipment, Fort Worth, Texas, installed GPS navigation systems inside company vehicles. This has resulted in reduced fuel costs and quicker delivery times, says David Bryan, the company’s president.

The recession has also made distributors more conscious of their purchasing.

In the past, some companies would stock-up on inventory if the right deal presented itself. Now the same distributors are buying only out of necessity.

“Our buyer has been very good at getting the best of the best when it comes to deals,” says Mark Cadell, president, Dutch Hollow Supply, Belleville, Ill. “Now he’s not buying if it’s just a good deal. We are only buying if we need it.”

The different cost-cutting techniques applied now are done as a means to survive. However, distributors should take this time as a learning experience. If distributors enforce the same policies when the economy improves, their company will be more financially stable in the long run.

“The most important thing to remember is that when you come out of it, your organization and employees are so much stronger and smarter,” says Breen. “They have been forced to deal with issues they never dealt with before.”