Q&A: Orgill's Brett Hammers on staying the course
New Orleans -- As far as dealer markets go, Orgill's approach is different than other wholesale distributors in the industry. At the very least, there's no official general session where the executives get on stage to deliver carefully prepared statements about the company’s new initiatives.
New Orleans -- As far as dealer markets go, Orgill's approach is different than other wholesale distributors in the industry. At the very least, there's no official general session where the executives get on stage to deliver carefully prepared statements about the company’s new initiatives.
In a way, this falls in line with where Orgill is at as a company. The Memphis-based distributor is on the cusp of moving to a new headquarters, having outgrown the previous one; it has also outgrown its five-location distribution footprint over the last 16 months (and now maintains seven).
As our chat with chief operating officer Brett Hammers revealed, flashy new game strategies are not necessary for Orgill at the moment. Clearly, whatever it's been doing has been working. And aside from the opening of a new facility in Idaho, much of the 2017 game plan will involve doubling down on what's already generated provable results for its customers.
The following interview with Hammers has been edited and condensed for clarity.
HBSDealer: You're expanding in Idaho -- I know that's not supposed to be fully operational until early April, but can you tell me a little bit about how that's going?
Brett Hammers: It's actually going really well. We bought a facility that was a manufacturing facility, so we've been in the process of converting it to a distribution center. All the racking is going in nicely. Despite contending with weather, everything is on target to be completed by the first of April. At that time, the plan is to move the Western Canada customers over to that DC. We've got routes established on our own trucks already. After that, we'll start servicing the Pacific Northwest, moving that business from our Hurricane, Utah distribution center. Currently the Hurricane distribution center services the entire Western part of the country, and it's gotten to a tipping point in terms of the need for capacity, because we've grown so much out West. The Post Falls facility was the ideal location because we could not only service the Pacific Northwest of the U.S., but also our new Canadian business.
HBSD: So Orgill is now fully integrated as a complete full-line distributor in Canada.
BH: Right, we stock about 60,000 SKUs in the London, Ontario facility. When we acquired it, there were 32,000 SKUs. So you can imagine the selection in London and how it expanded. Our Post Falls facility will stock products to support both U.S. and Canadian customers.
HBSD: Does Orgill have plans to widen its distribution footprint even further this year?
BH: Not this year, no. But we're always looking for opportunities when they arise. The more we can leverage our existing facilities, the more we can keep our customers’ prices low. The whole idea is to not add incremental costs to the system, because they have to be covered in the cost of goods. We would never open a facility unless it's an absolute must. But never say never -- you don't know what's going to happen.
HBSD: If you had to guess where Orgill will expand next, where would it be?
BH: That’s hard to say. Our newly expanded distribution network efficiently covers all of the U.S. and Canada. One thing we know for sure is that all of our future efforts will continue to focus on supporting the independent dealer, throughout North America and internationally.
HBSD: Of the new items that have been added since the last dealer market, are there any you're particularly excited about?
BH: I still think the FlexVolt technology with Stanley Black & Decker is one of the coolest technologies that is out there today. A lot of the smart key and home automation -- I think those are hits that are up and coming. Those are probably key categories where we're going to see significant growth in the future.
HBSD: Are your customers beginning to embrace smart home more than they have in the past?
BH: I think so. If you talk to the vendors, they'll probably all tell you they are. There's a lot of interest in it. I think people are tying in more to the reality that this is the way it is now. It's not just a fad. And I think as technology improves and demand increases, prices will go down and more people will embrace it.
HBSD: What are some of the most innovative retail ideas that you've seen from your own customers?
BH: We’ve got customers doing some really interesting things to drive traffic into their stores. I would point back to social media. A lot of the more innovative customers are really using social media to do more customer service-related integrated marketing.
HBSD: So it's almost as though there's more happening online than in the store.
BH: But they're one and the same, if you do it the right way. The whole idea would be to use social media to drive the traffic back to the store. Whether it be events, or items, or loyalty programs, it's pulling it all together into an integrated marketing plan. It's all one and the same.
HBSD: What would you say is the number one thing Orgill is doing in 2017 to make its customers' lives easier?
BH: We're not doing anything different than what we've done last year or the year before, because that is our goal. To try to find ways to help our customers be successful is our mission statement. It goes back to the distribution example -- we can add DCs, but that adds to cost, so it doesn't help our dealers if we have to pass along those costs. So we have to continue to find ways to leverage our distribution network and the intellectual properties we have where our customers can benefit. That's what the Dealer Market is about -- is bringing all the brands and retail concept stores and Hardware 101 and the integrated marketing together. Those programs are based on the fundamentals and foundations of what the retailers need in the marketplace. As long as we stay focused on that, we're going to continue to have success, and our customers will be successful too.
If there's one thing that's really up and coming, it's our brand building program. It's not new per se. We've been working on it for a while. If you go to the brand building seminars at the Dealer Market, every seminar is full. It resonates with our customers. And the whole idea behind brand building is really "local brand," and "your brand." If you own a store, is there more value in your brand, or being affiliated with a banner? Customers are shopping you for service, assortment and price. So building the local brand and driving them to you is really working around the characteristics of what makes you good, not what makes someone else good.
HBSD: Brand building is also such a different beast these days than what it used to be.
BH: Every store is distinct and different than any other store. They have their own characteristics, personality, customer base. What the brand building does is it brings out the best of what those characteristics are for that entity -- and then it draws in the customers that are the best for that business.
HBSD: Is there anything Orgill is doing differently this year to market itself?
BH: Orgill has been low-key throughout the years. We rely heavily on our sales force, and heavily on customers speaking favorably of us. The bottom line is if our customers are successful, we're going to be successful. Orgill is not a brand many people would recognize outside of this industry. Everything that we've been doing has been working, or we wouldn't be doing it. So we're going to continue to press as hard as we can on bringing the best value we can to our customers. The key thing is that we stay the course and stay consistent.