Trucking Times Feature Article MEYER DISTRIBUTING WEIGHS IN Chapter Two - The Chronicles Of The WD Distribution System By David Herrmeyer

In a September 2007 editorial titled Are You Buying From The Right Source?

I outlined the rapidly developing distribution challenges facing our industry. If you missed the article you can read it at www.truckingtimes.com.

Briefly, more products are being sold outside the normal warehouse distributor (WD) chain, and I pointed out what I see as the reasons. I tried to explain how I thought changes affect every step in the process of getting products from manufacturer to consumer. I tried to help everyone see the effects of their choices on themselves and others. I explained how our inter-dependency has created a system that has served everyone quite well, and that we need to be careful making changes. Several qualified sources agreed with my analysis before I published it.

We had more response to that article than from everything we have done in the past 18 years put together. This is obviously a huge issue for our industry. Virtually everyone who responded agreed that we need more dialogue on the subject.

In the article I invited additional comment, especially from WDs. Meyer Distributing was quick to respond. They invited me to meet with them at their headquarters in Jasper, Indiana, to tour their facility, and to discuss the issues. I met with their management team in October.

It helps to promote understanding if we can all take a closer look at the seldom-seen inner workings of a successful WD’s operation. Because Meyer Distributing contacted me first, I chose to add a profile of their operations for this report.

The main message they had for me is that not all WDs are the same. That is a point well-taken. Each WD has its own unique history and mission statement.

I learned that Meyer Distributing is a very old company. In the mid-1980s, Mike Braun acquired Meyer Body Company, a company that manufactured refrigerated truck bodies in 1938 and later served as a truck parts and equipment distributor.

Mike recognized the need for a strong Midwest aftermarket accessory distributor. He began serving retailers in Southern Indiana and quickly built a strong list of customers. In 1998, Meyer moved into a more suitable warehouse in Jasper, Indiana. They experienced rapid growth, which enabled them to open additional facilities. They currently have 14 locations. They serve all 50 states -- 38 of them with their own trucks.

Mike Braun continues to purchase smaller WDs who approach him with proposals. He plans to expand westward, but has no timetable. When the time is right it will be obvious, and I’m sure Mike will have no trouble recognizing the opportunity and acting on it.

The next thing we looked at was the Company’s vision for itself. Mike Braun is a man with a down-to-earth approach. He has a strong work ethic and the ability to instill the same in his people. He has a vision of what customer service should be, and makes certain no one forgets it. “Everything that each of our 400+ associates does on a daily basis has but one goal -- to improve our ability to offer the fastest, most flexible, and most reliable service in the industry. Our hardworking sales staff, the mix of over 300 product lines, and our high fill rate can be depended upon. When a customer calls he is greeted by a friendly, live person, not a recording. They are treated like a business professional,” said Braun.

Director of Marketing Joel Cosby said, “We have an Info Tech telephone system that alerts us to who the caller is and provides their information before we answer the phone. At Meyer, we say we have very few customers, but a lot of friends. We focus on what matters most in any business -- the Customer! Our traditional approach of focusing on the basics while integrating industry- leading methodology offers wholesalers and jobbers a premium branded name with Meyer Distributing.

“We look forward to continuing our efforts to provide the best service we possibly can. We will continue to support all of our customers and vendors, building partnerships and friendships across the globe.

We take a truly personal approach with every element of our operation. Each customer, vendor, and associate is treated with utmost respect.

It is our aim to show an attention to detail that will set us apart. We take pride in being close to the heartbeat of our business and hold all of our staff to the highest of standards. We will never lose sight of our core principles of dedicated, precise, and personal service,” said Cosby.

Leading companies are built on similar core fundamental principles. Constant focus on these guiding practices lays a solid foundation for future growth. At Meyer, their entire history has been based on building personal relationships and applying important fundamentals with a common sense, hands-on approach. Their team is devoted to improving all operational processes and to providing the industry’s highest level of service.

Every employee at Meyer Distributing is important, and they are valued. Adam Livingston was chosen for special recognition in this article, but he really seems to be somewhat typical here.

Employees are authorized to make decisions and solve problems on the spot. Salesmen are taught to put themselves in the customer’s shoes and make transactions easy and without problems. Employees are also wired at home for access to all the resources. Employees all seem to enjoy their work, and there is very little turnover.

The company and the employees have a strong commitment to being involved in the industry. Not only are they active members of the Performance Warehouse Association, SEMA, and LTAA, they are also members of SEMA’s Young Executives Network. They have over 40 employees who belong to the group -- more than any other company.

The vision of the company is clearly communicated, understood, internalized by each employee, and practiced diligently in their various responsibilities.

“I want to see easy access to the newest products, trends and promotions, and that means good communication. We provide new sales flyers, Web site improvements, catalogs, and everything we can come up with to provide the tools customers need to stay on top of the industry. Sales flyers, promotions, updated line sheets, and other materials are often delivered by our drivers. Meyer Distributing is committed to our friends (customer) and developing the tools to help their business thrive,” said Cosby.

Meyer has a commitment to technology. Their Web site not only provides the following features, but also an interactive video for learning how to them. A toll-free help line is also available. The Web site:

1) Reduces back orders and direct ships.

2) Provides POP displays and literature.

3) Helps market more effectively.

4) Provides needed product knowledge.

5) Provides real-time access to customer account, open invoices, and statements.

6) Provides a view of current pricing and inventory from multiple warehouses nationwide, and in real time.

7) Allows customers to create, modify, and track existing orders.

8) Provides notifications of special offers.

9) Provides a view of cutoff time and delivery schedules.

10) Seamlessly manages multiple ship-to stores.

11) Hyperlinks to vendor sites.

12) Provides for download of manufacturer-created media.

“Meyer Distributing is committed to offering customers the latest technologies and data- management capabilities. We are focused on building for the future,” said Cosby.

As is often the case with warehouse distributors, a separate company, Meyer Logistics, operates as a specialized transportation company providing warehousing and highly competitive and efficient LTL service that helps fill trucks and provides back hauls. While every effort is made to keep the delivery costs under control, at times they dispatch a pickup truck to make urgent deliveries. Customer service is more than just a slogan. They have a .005 percent back order rate and a 2-week goal for crediting return goods.

It became time in Meyer’s evolutionary progression to establish a dealer show. I was given a special invitation to attend what they bill as ginormous -- the hottest and newest show in the aftermarket accessory industry. It was held at the Kentucky Exposition Center in Louisville, Kentucky, January 18–19, 2008. They had all the bells and whistles including educational seminars, cash prizes, a Show and Shine competition, an off-road demonstration course, and a MEGA party with live music. From what I saw, it was well-run, well-promoted, and well attended.

This is an appropriate place to restate the value that WDs bring to the distribution system. Our industry relies on product variety, and WDs provide a range of performance, work, and appearance products never before seen. This helps stimulate add-on sales of products that make us a profit and help meet customers’ wants and needs. Without WDs, hundreds of products would simply go away.

I would suggest that there are untapped opportunities for WDs, as there are for all of us. They could become even more of an integral part of the selling process by creating truck-specific accessory packages and helping dealers market them. They could create work-truck specific catalogs and lifestyle packages that local stores don’t have the resources to create. They could also put together point of purchase displays that combine the products of many manufacturers. They could help provide marketing ideas so dealers can get their products out without relying so much on paid advertising. In the past, co-op funds have been for paid advertising. Dealers need to place a higher value on help they receive in improving their marketing skills. The best positive solution I’ve seen offered for our industry is to get us all better at actually selling things instead of just taking orders.

WDs are in a unique position to be able to provide these benefits, and they have the greatest incentive to do so.

I’m sure all WDS are working very hard to find ways to help everyone in the system get what they want and need. It’s up to all of us to protect the product variety that we depend on. I re-issue my earlier call to action. Let us not be the enemy of the WD, but rather their partner in taking this industry, literally, into a brave new world.

For my own part, I simply repeat my original advice. “I’d remain true to the system unless and until you can verify long-term advantages that outweigh the inevitable disadvantages of any curative. Eliminating WDs will not solve our problems. It may solve some, but I know it would create more that are not being properly considered.”

I’ll end with the statement I opened with in my September editorial. “When business changes -- businesses change. WDs are smart, they adapt, and they do provide a valuable service.”

I’d like to thank Mike Braun and Adam Livingston for the time they spent with me. Special thanks must go to Joel Cosby for arranging the meeting and for spending nearly the entire day with me. Thanks also to all the employees I met.