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Proven Techniques:
Leveraging Next-Gen Point-Of-Use Vending,
Profitable Account Growth In Today’s Market
Point-Of-Work
Technologies
® 2009 Apex Industrial Technologies LLC All Rights Reserved
Apex White Paper—Proven Techniques – Leveraging Next-Gen Point-of-Use Vending Page 2
Contents Don’t suffer the same fate as the gazelle ............................................................................... 3
A smart solution ........................................................................................................................................ 3
Building relationships, growing business .................................................................................................. 4
Both bottom lines benefit ......................................................................................................................... 5
C&T practices what they preach ............................................................................................................... 5
Smart solution for suppliers of all sizes .................................................................................................... 6
Reliability equals savings........................................................................................................................... 7
Bundling Brings Business ....................................................................................................... 8
How to bundle up more business ........................................................................................................... 10
Distributor stays a step ahead of competition ...................................................................... 11
When solutions meet needs ................................................................................................................... 11
Bringing in business ................................................................................................................................ 12
The dollars make sense ........................................................................................................................... 13
Functionality combined with reliability .................................................................................................. 13
Creativity leads to increased sales .......................................................................................................... 14
Distributor’s market share ‘spreads like wildfire’ ................................................................. 14
Giving ‘re-boot’ new meaning ................................................................................................................ 14
Reliability breeds content ....................................................................................................................... 15
‘Spreading like wildfire’ ........................................................................................................................... 15
Apex Industrial Technologies 7300 Central Parke Blvd.
Mason, OH 45040 513-204-2100
www.Apex-Industrial.com
Apex White Paper—Proven Techniques – Leveraging Next-Gen Point-of-Use Vending Page 3
Don’t suffer the same fate as the gazelle
The gazelle is one of the fastest animals on earth. It can run away from just about anything on four legs.
But Mother Nature played a cruel trick on the gazelle.
It has the misfortune of sharing its home turf with nature’s fastest mammal, the cheetah.
The cheetah doesn’t bother to wait for the gazelle to come to him. He uses all his wits and cunning,
silently stalks his prey, moves in and then runs down, and pounces on, his bounty.
Is your company the predator, or is it the prey?
Especially during a down economy, many distributors are seeing business fall off. Their customers’
revenues are down or, at best, stagnant, so distributors accept the “fact” that their business will suffer
proportionally. This assumption leads to defensive tactics: Distributors cut personnel and inventory
which, in turn, degrades service levels. Lead times stretch. Orders are late and customer satisfaction
goes downhill. Many distributors just shrug it all off: “It’s the way things are today” or “Everybody does
it. It’s just a ‘fact’ of life today.”
But don’t accept those “facts.” And don’t assume there’s nothing you can do.
Because you can. You can turn the current situation into a very large and very real opportunity.
Some aggressive distributors recognize this as a time when they can not only preserve the revenues
they’re accustomed to, they can increase sales. They’ve simply found a creative and effective way to
gain new customers as well as gain a larger percentage of their existing customers’ business – while
saving those same customers money by
making their operation more lean and
efficient.
This may all sound like a mass
contradiction. But it all adds up – to more
profits for both distributor and customer.
And aggressive distributors have the
numbers to back them up.
During these tough times, companies have
been forced to take a hard look at their own operations to save money. Some have eliminated jobs. But
some are finding efficiencies that will not only save jobs, but save the bottom line.
Small- to medium-sized distributors as well as the largest national and international distributors and
suppliers have let Apex Industrial Technologies’ vending systems work for them to both retain and build
business even in tough economic times.
A smart solution
C&T Industrial Supply in Mercersburg, Pa. is a full-line stocking distributor of industrial supplies, cutting
tools and machine tools and an authorized distributor of lines including Mitsubishi, Seco Tools, Walter
One customer has two machines that generate up to
$40,000 a month in sales and another has five
machines that generate up to $30,000 per month.
The plant manager of a machining and fabricating
customer with 120 employees said he realized a 22%
cost reduction for tooling and supplies last year due
to the implementation of the vending system versus
the old tool crib.
Apex White Paper—Proven Techniques – Leveraging Next-Gen Point-of-Use Vending Page 4
C&T Industrial Supply not only utilizes vending systems from Apex
Industrial Technologies at their customer sites to build and retain
business -- they also use Apex industrial vending in their own facility.
Waukesha, American Torch Tip, Femco.kafo CNC Machine Tools, Summit Machine Tools, Carborundum
Abrasives, Wikus Saw Blades, National Standard Weld Wire, Cosen Band Saws and many others.
C&T had a customer with an annoying situation that developed into a nagging headache.
But a win-win solution for the distributor and its customer was just around the corner – at the
customer’s point-of-work.
The shop did not have an attended tool crib, so management passed out tools to machine operators
through a cumbersome manual process. The shop’s manager had to leave the office every time an
employee requested another cutting insert. This interrupted both the manager’s and employee’s tasks
at hand. It reduced efficiency and increased downtime and costs.
Tracking of the inserts was inefficient at best. If one was requested, one was doled out. There was no
control of how many each employee was going through, so the company didn’t even realize the scope of
its inefficiency.
But C&T had an answer to the problem . . . one which would cost their customer nothing, and pay
immediate dividends in reduced costs, less downtime and more efficiency.
By providing an industrial vending system from Apex Industrial Technologies, C&T not only solved their
customer’s problem, they solidified their relationship with a valued customer.
Building relationships, growing business
It’s not the first time C&T used industrial
vending to strengthen ties with a
customer.
And it’s allowed them to increase sales as
well as gain new customers.
C&T Vice President & General Manager
Rick Twine explained how the
arrangement between distributor and
customer benefits both.
“We never actually sell the systems. The
customer doesn’t lease or buy them,”
Twine said. “C&T buys the systems and
provides them to the customers to use.
There’s no monthly cost or fees to them.
We pay those.”
“In every situation, in the beginning we’re only supplying certain items to
the customer. But over time we capture more and more business in
abrasives, cutting tools, welding supplies, cutting fluids and more.”
Apex White Paper—Proven Techniques – Leveraging Next-Gen Point-of-Use Vending Page 5
“Our customer doesn’t even have to ‘carry’ the inventory,” he said. C&T owns the machines and
restocks them.
The customer signs an “informal 3-year contract” and commits to a minimum monthly dollar figure of
purchases. Customers also give C&T first crack at other materials and supplies they normally purchase.
“An automated integration, if you will,” Twine said. “We even get automatic reorders.”
Not only does C&T’s customer save time and money, so does the distributor.
“Our order processing and fulfillment costs are way down with the Apex system and we never have to
respond to stock-outs and emergency orders because the machines and software stay ahead of the
demand requirement.”
And a C&T employee doesn’t have to drive 2-3 hours to track the machines’ inventory as they did in the
past – it’s all done accurately, automatically and efficiently over the Internet at C&T’s headquarters,
utilizing the Apex C3i Hub.
Both bottom lines benefit
As in any business, the bottom line is . . . the bottom line. And Apex’s industrial vending systems pay
measurable dividends for C&T every single time.
“In every situation, in the beginning we’re only supplying certain items to the customer,” Twine said.
“But over time we capture more and more business in abrasives, cutting tools, welding supplies, cutting
fluids and more.”
One customer with 110 employees has two machines that generate up to $40,000 a month in sales and
another with 130 employees has five machines that generate up to $30,000 per month.
“I can tell you this: Installing (Apex) machines solidifies our presence within a facility and increases our
sales within that facility” every time, Twine said.
C&T’s customers see the benefits of industrial vending almost immediately, with increased uptime for
the customer as well as better tracking and inventory control.
“It relieves supervisors and lead people from taking time to service employees in the middle of the day,”
Twine said. “It’s especially good for night shifts.”
And it’s especially good for the customer’s bottom line.
The plant manager of a machining and fabricating customer with 120 employees said he realized a 22%
cost reduction for tooling and supplies last year due to the implementation of the vending system versus
the old tool crib.
Twine said C&T’s vending customers range from 30-50 employees up to 100-130 employees.
C&T practices what they preach
Unlike the previous industrial vending systems C&T utilized, the Apex system is more reliable, durable
and cost-effective for both C&T and its customers.
Apex White Paper—Proven Techniques – Leveraging Next-Gen Point-of-Use Vending Page 6
“Apex has been excellent as far as both ease-of-use and reliability,” said Twine. “We’ve been very
pleased with Apex’s support which is just a phone call away. We’re very pleased with the machines
themselves, and the service.”
And if anyone needs more proof of what C&T thinks of the Apex Edge 5000 system?
They use two of the machines in their own plant.
Smart solution for suppliers of all sizes
Vending is a lead-in to additional cutting-tool business as well as additional volume, according to Jim
Long, president of Cline Tool and Service Company in Newton, Iowa, a full-line industrial distributor and
manufacturer of cutting solutions.
“We’ve gone into accounts where we had very little existing business; now we have it all,” he said.
Although Cline Tool’s specialty is cutting tools and inserts, vending has given them the opportunity not
only to increase cutting tool sales with an existing customer, but gain additional business.
“In one plant, we had about 30% of their cutting-tool business,” Long said. “Their shop foreman tightly-
controlled things and everything went through him. You had to go to his office and get supplies from
him. He was very concerned about vending when they looked into it.
But that process was costing both the foreman and employees time, and the company money.
Vending’s proof was in the pudding. “Now, he’ll tell you that vending is the best thing ever,” Long said.
“It’s freed up a lot of his time and he is very happy with it.
“And we’ve gained an additional $15,000 per month in revenue from them, mostly cutting tools,” he
said.
Fastenal is one of the largest and the fastest-growing full-line industrial distributor in the U.S., with over
2,300 store and in-plant locations.
Fastenal has combined Apex Industrial Technologies’ Connect n’ Go technology and incorporated it into
their SmartStore program, in which FAST provides technology and stocking services. Backed by
aggressive sales and marketing campaigns, the SmartStore program is driving significant business
growth and new account acquisition at a time when the total MRO marketplace is shrinking.
The “Smart Solutions” message is resonating with prospective Fastenal customers. Plant managers,
production and finance managers, Lean and Six Sigma managers and safety managers are all looking for
ways to reduce costs and improve productivity. Keying on this message has opened new doors for
Fastenal and the result has been proven in the bottom line of Fastenal customers:
Waterloo Industries reduced its glove consumption from
$13,000 to $9,200 in the first month after two machines were
installed, and the time that tool crib attendants spent dispensing
gloves was reduced by 65%.
.”
Apex White Paper—Proven Techniques – Leveraging Next-Gen Point-of-Use Vending Page 7
Waterloo Industries reduced its glove consumption from $13,000 to $9,200 in the first month
after two machines were installed, and the time that tool crib attendants spent dispensing
gloves was reduced by 65%;
Cooper-Standard has reduced costs by more than $21,500 per week, and now spends less time
on inventory and has achieved a total elimination of stockouts;
JBT Food Technologies saw a 20% reduction in usage of safety gloves, and the Fastenal in-plant
manager has seen about one hour each day freed up that he used to spend dispensing gloves;
he also no longer needs to manually generate a monthly report, because they are automatically-
generated.
The machines are a “24/7 stockroom attendant,” said Fastenal’s DJ Schilling. “They eliminate waiting
time and help productivity.”
And while Fastenal’s customers have saved time and money by combining Apex and FAST
technologies, this doesn’t mean Fastenal sales have dropped. Just the opposite.
In fact, Fastenal has gained business through showing customers how to be more efficient, thereby
strengthening ties with customers and increasing overall sales. Fastenal and Apex technology has
proved superior to the systems previously utilized by existing vending customers.
Schilling explained how vending allows Fastenal to strengthen its ties with customers, which
translate to additional business.
“In some plants we had the tool business,” Schilling said. “Vending has helped us pick up the PPE
volume, since we’re already there and doing the work. It saves them headaches.”
Reliability equals savings
Xcel Energy is one of the nation’s leading electricity and natural gas suppliers. They had previously
used pilot programs in several plants using a vending machine company other than Fastenal.
But those programs led to some serious “issues”, including: The machines were maintained and
operated by a third party and Xcel
would incur service-call fees and
miscellaneous expenses dealing with
a company not familiar with Xcel;
program and implementation costs
were expensive; there were multiple
reporting and databases to
maintain; there was long lead time
on repair and service; and service
personnel weren’t familiar with each
plant’s needs.
However, by utilizing Fastenal for
their supply needs and vending
machine program, Xcel Energy was
able to:
Fastenal/Apex Team preparing for installation at Xcel Energy Riverside
plant. Xcel has realized huge cost savings by using Fastenal as their
vending systems supplier at numerous plants throughout the country.
Apex White Paper—Proven Techniques – Leveraging Next-Gen Point-of-Use Vending Page 8
Reduce overall program costs 30-50%
Eliminate third-party equipment and software; Xcel now deals with Fastenal on products,
equipment, software and maintenance
Streamline reporting, all from one source – Fastenal
Reduce lead time in product restock
Recently a Fastenal district manager stated that the machines have been so successful for Fastenal
that he wants to see the systems on-site at all of their customers. He had replaced a competitive
industrial vending system with seven Fastenal SmartStore units. The president of the customer’s
corporate parent visited and expressed his enthusiasm for the benefits his company received. With
an “endorsement” from the CEO, Fastenal can now develop additional growth opportunities outside
this particular plant.
Bundling Brings Business
Historically, there has been a good bit of resistance to industrial vending from industrial distributors. It
was not clear how the technology should be marketed. The business case was challenging and customer
demand was modest. So, many industrial distributors either offered industrial vending programs when
pushed by their customers or ignored industrial vending altogether.
In many cases, there was a solid basis for this approach. Early-generation industrial vending systems
were:
Too complex
Tool expensive
Too hard to implement
Today, everything has changed.
Apex Connect n’ Go technology provides the latest and best industrial vending technology at much
lower prices than historical industry price levels. This makes the business case easy to justify (and easy
for customers to say “yes”). Connect n’ Go technology makes it easier to implement, which frees up time
and resources for the industrial supplier and is easier to use, which increases customer satisfaction.
Customer demand for Point-Of-Use vending solutions is at an all-time high. In the current economic
environment, companies are actively pursuing any and all possible means of reducing costs and
improving productivity.
Leasing has also contributed to the switch to Point-Of-Use technology, and accelerated growth as well.
The low monthly lease cost of Apex Connect n’ Go technology makes it easy for distributors to bundle
the technology into their offers without tapping into their capital or existing credit lines. Leasing Apex
POU machines may cost a distributor as little as $250 per month.
Innovative suppliers such as C&T and Fastenal are a step ahead of their competitors due to their
innovative bundling of Point-Of-Use systems with the products and services they already offer. Bundling
strengthens the ties between supplier and customer, and can bring in increased business even during
The low monthly lease cost of Apex Connect n’ Go
technology makes it easy for distributors to bundle
the technology into their offers without tapping
into their capital or existing credit lines...”
Apex White Paper—Proven Techniques – Leveraging Next-Gen Point-of-Use Vending Page 9
tough economic times. The customer still needs to buy a certain amount of supplies even if business has
slowed, but due to bundling, the supplier has gained a larger share of the customer’s business.
In one case, a particular customer historically purchased only personal protection equipment from a
distributor. But even though the customer is experiencing a downturn in business, due to the bundling
arrangement, that customer also now buys its cutting inserts and abrasives from that distributor. So the
distributor has actually gained business, while the customer benefits by increasing its efficiency of
dispensing tools, supplies and materials.
Many suppliers are reluctant to embrace the idea of providing Point-of-Use machines at “no cost” to
customers. This violates the “traditional” business model, and until fairly recently the machines were
cost-prohibitive for suppliers.
However, new low price levels
made possible by Apex Connect
n’ Go technology, combined with
customers needing, if not
demanding, POU technology,
mean suppliers are now seeing
both the economic and the
competitive advantage in
bundled offers.
Bundling services with POU
technology not only adds
customers, it strengthens the
existing relationship between
distributor and customer in more
ways than one. Suppliers are
learning that they can lessen the chance of a competitor taking their business, because their customers
come to depend on the POU technology they are being provided.
Apex POU technology provides control and real-time information availability. This enables much faster
inventory turn rates than have previously been possible. Often inventory in well-managed industrial
vending machines turns as often as 15-30 times per year. Particularly in the case of high-use cutting
tools, inventory turns can be accelerated to a point where inventory is turning every 3-5 days.
So it’s now an advantage rather than a disadvantage to offer consignment inventory as a standard
option in bundled service offers.
Bundling offers several advantages to a supplier, especially in today’s economic climate:
It insulates existing customers from being taken away by the competition
Those existing customers will often give the supplier business that they didn’t previously have,
as in the aforementioned example.
Apex Industrial Technologies case studies have documented
companies which, via industrial vending, have:
Reduced spending by 20% and increased the uptime of 50
employees
“Greatly reduced product consumption”, realized “major cost
savings” and gained control over its inventory
Freed up 65% of tool crib employees’ time and cut glove
consumption by $4,000 per month
Virtually eliminated waste and hoarding of MRO supplies
while reducing consumption by 20%
Reduced safety glove consumption by 13,000 each year and
safety glasses by 4,000
Apex White Paper—Proven Techniques – Leveraging Next-Gen Point-of-Use Vending Page 10
Finally, bundling is a great way to grow a distributor’s business. Industrial vending can be a way to get
your foot in the door with many companies that haven’t previously given strong consideration to a
particular supplier.
Combining all that with an increase in competitors making the shift, a distributor of industrial supplies
cannot afford to bypass this opportunity.
How to bundle up more business
There are three types of bundled offers being used by suppliers:
Bundled Offer with Integrated Supply Program
Bundled Offer With Supplies
Bundled Offer With Supplies and Services
In a Bundled Offer with Integrated Supply Program, many integrated suppliers now include POU
technology as part of their contracts for outsourcing MRO procurement and distribution. Often the end-
user requires POU technology as part of the Statement of Work.
As with most Integrated supply engagements, once the integrator is appointed, the integrator becomes
the procurer of the POU technology on the end-user’s behalf. By automating repetitive, manual tool crib
transactions and moving them out to the Point-Of-Work, Integrated Suppliers can improve the level of
service to their customers while decreasing their cost to provide those services.
In a Bundled Offer With Supplies structure, a supplier of consumables offers the POU technology as
part of the supply program. There are numerous derivations of this structure ranging from simple to
complex. The simplest of these is when a supplier offers to provide a machine as part of an agreement
to provide supplies.
A cost may or may not be assigned to the machine
A monthly payment may or may not be assigned to the machine
A minimum purchase amount is typically required on a monthly or annual basis.
In some cases, the machine is provided at no charge if the supply purchase obligations are
met. This is often referred to as the “Free machine” program. In other cases, a rebate or
credit is established based on purchase volumes to offset the imputed monthly cost for the
machine. The “Free Machine” is a successful means of gaining profitable market share.
Many suppliers are now driving an important change in offer structures. The “Free Machine”
offer is shifting to “Free Use of a Machine” (and away from “We Will ‘Give’ You a Free
Machine. This allows the supplier to:
1. Retain more control over the end users’ purchasing and
sourcing behaviors
2. Tie use of the machine closely to product purchases, year after
year
Kenna’s Use of POU
Strategies For
Distributors
Apex White Paper—Proven Techniques – Leveraging Next-Gen Point-of-Use Vending Page 11
Cline welcomes Tech Fair visitors to see Apex
Connect n’ Go Technology in its own plant.
3. Tie customers more closely to the supplier
4. Increase the barrier to change
5. Build a large pool of strategic assets deployed at customer
accounts
In some variations of this structure, suppliers “buy down” the monthly payment for their
customers by offering a partial subsidy. This approach is frequently used for low-volume customers. For
example, for a POU system with a standard monthly payment of $ 250 per month, a vendor might offer
a $125 per month subsidy, thus buying down the cost by half.
A Bundled Offer With Supplies and Services structure is very much like Bundled Offer With Supplies,
except that the supplier may offer additional services such as repackaging of vendible products and
refilling machines.
Distributor stays a step ahead of competition
Cline Tool and Service Company in Newton, Iowa is a manufacturer of custom tool cutting solutions, a
full-line industrial distributor and provider of value-added integration programs. For over 50 years Cline
Tool has provided project management solutions for Fortune 500 companies to small businesses.
Cline Tool’s Integrated Supply Programs offer technical
support, upfront planning, supply chain analysis, custom
reporting and detailed cost savings reporting. As both a
full-line manufacturer and distributor, Cline “understands
the needs and processes necessary to lower your cost of
manufacturing. It is the tooling – and processes in which
they are employed – that dictate the efficiency of your
whole operation.”
Cline’s value-added integration and dispensing programs save companies money and improve efficiency.
When solutions meet needs
A few years ago the company saw that a growing number of small- to medium-sized companies coveted
the technology of industrial vending, according to Cline Tool President Jim Long. Customers saw
information on industrial vending in trade magazines or at shows and saw its potential for their
companies, primarily with cutting tools but also with other items.
But many times the smaller companies didn’t have the spend to support it, Long said. And Cline Tool
couldn’t afford to spend the roughly $12,000 per machine plus software and installation costs, either.
“We saw a need for a relatively low-cost system but which also had the reporting capabilities that were
needed,” Long said.
Apex White Paper—Proven Techniques – Leveraging Next-Gen Point-of-Use Vending Page 12
Visitors to Cline Tool Tech Fair watch demo of Edge 5000 Industrial
Vending System.
“Small- to medium-sized companies frequently have little or no access to data. The crib is a black hole
that just sucks these products through and many of the older-generation vending systems aren’t good
for tracking. The older technology was too complicated and too expensive.
Cline Tool saw that its previous industrial vending machine supplier was not a good choice for point-of-
work vending.
“Apex really fit,” Long said, with its combination of price, functionality, reliability and tracking
capabilities.
“If a company is spending $4,000 to $5,000 per month, we can almost justify putting a machine in for no
charge,” Long said.
With Cline Tool’s previous supplier, that spend level required to justify providing a machine was in the
$9,000+ range.
Bringing in business
Cline Tool saw the value in industrial vending – the company even used Apex Connect n’ Go technology
at its manufacturing facility.
And more and more their customers saw the value in vending.
However, there was a disconnect.
“We and other distributors traditionally would go into a customer and they were interested in vending,”
Long said. “But many times they never get you the spend data, then interest fades and nothing happens.
“Now, our approach is to tell them not to
worry about getting us the data. I send a
team to their facility to move the process
along.”
Vending is a lead-in to additional cutting-
tool business as well as additional volume,
Long said.
“We’ve gone into accounts where we had
very little existing business; now we have it
all,” he said.
Although Cline Tool’s specialty is cutting
tools and inserts, vending has given them
the opportunity not only to increase
cutting tool sales with an existing
customer, but gain additional business.
“It’s hard for our customers to quantify
usage reduction due to vending,” Long said. “Many of them are job shop accounts where there’s a lot of
ebb and flow to their business; work is up and down, schedules are up and down. It’s not like a large
automotive supplier that’s doing a constant business. It’s not easy to quantify.
Apex White Paper—Proven Techniques – Leveraging Next-Gen Point-of-Use Vending Page 13
Expert tool information presented at Cline Tool Tech Fair.
“We use data from the Apex system for cost-analysis and go show them potential cost savings and make
suggestions.”
The dollars make sense
“In one plant, we had about 30% of their cutting-tool business,” Long said. “Their shop foreman tightly-
controlled things and everything went through him. You had to go to his office and get supplies from
him. He was very concerned about vending when they looked into it.
But that process was costing both the foreman and employees time, and the company money.
Vending’s proof was in the pudding. “Now, he’ll tell you that vending is the best thing ever,” Long said.
“It’s freed up a lot of his time and he is very happy with it.
“And we’ve gained an additional $15,000 per month in revenue from them, mostly cutting tools,” he
said. “They’re very supportive of vending.”
The most common “spillover effect” is for Cline Tool to have a customer’s cutting tool business, and
vending allows them to gain PPE spend.
Long said Cline Tool “had sort of a loose integration program” with a company in which Cline Tool was to
supply all the crib and vending items. But the customer wasn’t living up to its purchasing agreement; the
crib attendant priced and controlled everything and their business with Cline Tool ebbed and flowed.
“So we did an analysis for the vice president and showed him ‘true cost’ – the cost of holding inventory,
shipping costs, etc.,” Long said.
“We ended up showing them about 50 items that it made sense to vend. We probably gained $8,000 to
$10,000 per month.
And the customer is pleased because the tool crib attendant no longer has to manage and check-in
items so often. “As a matter of fact, her time has been freed up and she’s been given other
responsibilities,” Long said.
“If you look at the mix of products we sold five years ago, there was hardly any PPE,” Long said. “Now
we have shelves and shelves of PPE.”
Functionality combined with reliability
At two locations recently, Cline Tool pulled the
existing older-generation industrial vending
machines and replaced them with next-generation
Apex systems.
The previous systems “ went down far too often and
Apex had better functionality,” Long said.
“Management liked Apex better, and now the Apex
machines also manage their PPE equipment.”
Apex White Paper—Proven Techniques – Leveraging Next-Gen Point-of-Use Vending Page 14
Fastenal Energy Account Specialist
DJ Schilling next to a SmartStore on
the Apex assembly line.
“In this market, MRO customers come and go regularly,” Long said. “But we have never lost a program
that used vending. Once you are engaged and have an industrial vending system properly implemented,
a customer is much less likely to shop you around.”
He said that, when first approaching a company about vending, “We’re an open book, we’re very up-
front with customers; it’s more like a partnership.”
Cline Tool has been very successful bundling the Apex vending solution with its product and service
offerings.
“If they reach certain volume levels, the machine is no cost and we can also absorb the software cost,”
Long said.
Creativity leads to increased sales
Cline Tool has also gained new customers in other creative ways.
Working closely with Apex Industrial Technologies, Cline Tool has promoted Connect n’ Go technology at
tech fairs held at Cline Tool’s headquarters in Iowa.
Customers and potential ones attend the tech fairs and receive demonstrations of Apex’s industrial
vending systems technology . And Cline Tool also has the opportunity to showcase its wide range of
products and services.
At a recent tech fair, Cline Tool attracted new customers now projected to spend well into six figures
annually.
Distributor’s market share ‘spreads like wildfire’
Fastenal is one of the largest industrial distributors in the U.S. and the fastest-growing, with more than
2,300 stores including in-plant facilities.
DJ Schilling is in corporate sales, overseeing several million dollars in
sales annually.
His job is to gain business from end-users in power generation. He
ensures that the same high level of customer service is in all plants
and that pricing is consistent.
Schilling’s customers have the most Fastenal vending machines.
Fastenal takes Apex Industrial Technologies’ Connect n’ Go
technology and incorporates it into their SmartStore program, in
which FAST provides technology, inventory management and
stocking services at the point-of-work.
Giving ‘re-boot’ new meaning
Fastenal utilizes industrial vending as a sales tool to maintain and
Apex White Paper—Proven Techniques – Leveraging Next-Gen Point-of-Use Vending Page 15
add business.
“As in many industries, I’ve never seen any power plant add employees or replace all the retirees or
someone who leaves,” Schilling said. “At one plant recently, two folks retired; only one was replaced as
budgets got tighter.”
More workload is put on the existing employees and efficiency is at a premium. And technology,
reliability and functionality are mission-critical.
Schilling explained that power plants typically have many out buildings, and point-of-work vending saves
companies time and money.
“We put machines in coal yard areas and employees don’t have to get in their trucks and drive just to
get a pair of gloves anymore,” he said.
Schilling said one plant’s stockroom was in a location far from a previous supplier’s vending machine --
before Fastenal partnered with Apex.
The attendant was getting tired of hearing “We need you to go re-boot” the machine and then having to
take time to drive out to the machine, re-boot it and drive back.
The previous system’s lack of reliability led to one-too-many re-boots.
She finally told one of the employees: “If you tell me to re-boot this machine one more time, I’ll put that
boot somewhere else!”
Reliability breeds content
Fastenal’s service combined with Apex’s reliable Connect n’ Go Technology (no MS Windows) solved the
constant re-booting problem, freeing up time for both the stockroom attendant and the workers in the
field while reducing downtime.
Also, with the previous vending machine company, the plant had to deal with not only high service call
fees but service personnel who were unfamiliar with the company. Maintenance and program costs
were high and there was long lead time on repair and service, and service personnel weren’t familiar
with each plant’s needs.
Schilling said many plants which had another vending system now have Fastenal SmartStore systems,
and Fastenal receives many compliments due to the systems’ reliability, durability and automatic
tracking capabilities.
Fastenal’s vending systems have not only reduced the plant’s costs. Restocking lead time has been
reduced and the plant has gained the consistency and reliability of Fastenal being their one source for
stocking, equipment, software and maintenance.
The machines are a “24/7 stockroom attendant,” Schilling said. “They eliminate waiting time and help
productivity.”
‘Spreading like wildfire’
Schilling explained how vending allows Fastenal to strengthen its ties with customers, which translate to
additional business.
Apex White Paper—Proven Techniques – Leveraging Next-Gen Point-of-Use Vending Page 16
Fastenal replaced Xcel’s Energy’s previous vending systems with FAST SmartStore vending solutions at the Sherco generating
plant in Becker, Minn.
“In some plants we had the tool business,” Schilling said. “Vending has helped us pick up the PPE
volume, since we’re already there and doing the work. It saves them headaches.”
He said the previous vending machine supplier was a “very bad name” and equipment was very
maintenance-intensive.
“The safety machine vendor wasn’t in the plants,” Schilling said. “There was no local presence, they had
to fly in the tech guy. We actually serviced it more ourselves.
“They like Fastenal handling the machines – they know Fastenal.”
He cited a recent example of a plant where Fastenal has not only gained business; they expect to garner
even more than they might have expected.
In one plant Fastenal “had some business but not a lot,” Schilling said. “But the story (of vending) spread
like wildfire from people we didn’t know about, and we’ve found out about departments that we didn’t
even know existed.”
Now, they are customers.
Apex Industrial Technologies
7300 Central Parke Blvd. Mason, OH 45040
513-204-2100 www.Apex-Industrial.com
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