Three gentlemen named Ed founded Ed's Supply in 1957 in Nashville, TN. It was a single store that reflected the desire of the three Ed's - Ed Nance, Ed Kennedy and Ed Dillow - to own and operate an HVAC supply house with parts and equipment that would offer great service from great people.
Today, there are 15 Ed's Supply locations around Tennessee, Arkansas and Georgia. While there may not be any more Eds who are running the business, their spirit lives in the 225 employees who continue to provide that great service.
“Without the people we have, we wouldn't have the company that we have today,” says Lincoln Lakoff, one of the five principals of Ed's Supply. Three of the principals, Lakoff, Steve Byram and John Hall, oversee the Nashville operations. Ernie Sanders runs the Chattanooga operations, and Scott Brewer runs the Little Rock, AR, operations. Each is run as a separate corporation, though the Nashville corporation has an interest in both Chattanooga and Little Rock.
Each operation operates five branches, serving their customers in the way that best suits their local markets. Ed's Supply had been based solely in Nashville, but when the management team years ago decided to expand west into Little Rock and Chattanooga, they sought out partners who would have a vested interest in the business, giving them “a stake in the game,” Lakoff says.
Ed's Supply serves most of Tennessee and Arkansas as well as north Georgia. Because the markets are diverse, branch managers have a lot of control over their inventory. “We give them the ability to go to market the way that it fits their markets,” Lakoff says. When it comes to purchasing decisions, Lakoff says branches may order some inventory separately, while they prepare some orders for all 15 branches. “We're very flexible in our structure, based on what their needs are.”
You can't talk about Ed's Supply without talking about its employees, according to the principals. Ed's Supply invests time and money into its people - from training and education to rewards and incentives. “We say it over and over again - people don't come to Ed's Supply because of the location or the building or the fancy computer system. They come to Ed's because of the people who work here and the people who are part of the business,” Lakoff says.
Over the years, Ed's Supply has taken care to hire good people with potential. They don't have to be experts in the HVAC business, but if they have the aptitude and the “attitude,” then they will be successful, Lakoff says. “We give them the training on technical matters, training on people skills and training in customer service - both with customers in the field and in our house.”
This type of sustained commitment to employees pays off for everyone. Turnover among employees is low - Ed's Supply becomes a career for them. And Ed's Supply rewards loyalty. Lakoff points to a wall at the headquarters in Nashville with photos of their longtime employees. This photo wall continues to grow. “We've given out 28 Rolexes currently,” he says of the watches that they award for longevity with the company.
Even during lean economic times, Ed's Supply maintained their workforce without layoffs. Steve Byram says this sends an important message to their employees and customers about how much they are valued. “We rode out the storm with our employees,” he says. “They've been the key to our success and they know the business.”
He cites the recent economic recession as a case in point. “We chewed up a lot of cash flow in 2008, 2009 and the first part of 2010,” Byram says. “We weren't making the money we were used to making, but we were willing to take that hit.” The remainder of 2010 was successful, and the business is doing well. “We've been very pleased to have a very strong business,” he says. Over the past three years, Ed's Supply has grown 30 percent.
Also helping to maintain its business has been the diversification of its specialties - from its residential heating and air conditioning to commercial refrigeration and air distribution. About 30 percent of Ed's Supply business is in equipment, while about 20 percent is in air distribution. Parts are a big part of the business, too, making up about half its business, and that has enabled it to ride out leaner times. “Parts can get you through a recession,” Byram says. “People aren't replacing equipment; they're fixing it.”
All of the training and experience mean there's a lot of expertise among Ed's Supply employees. There's a true spirit of camaraderie among the employees that encourages them to share knowledge and seek out those who have knowledge. “Not all of us are experts in everything,” Lakoff says. “We have enough people who are good in lots of different things so we can find that answer for our customer.” All it takes is a phone call to the right person for the right answer.
As Ed's Supply has grown, an important component of this success has been its commitment to strategic planning. Not surprisingly, the leadership team has brought in employees to have a strong voice in shaping a three-year plan, which the company reviews and updates annually. Ed's Supply's strategic planning session is an opportunity to analyze its growth, evaluate how they're doing on their goals and look ahead to opportunities that will position them for growth in the future.
Department managers are part of these strategic planning sessions because they are on the ground and have a day-to-day understanding of the issues in play. Lakoff says their involvement in strategic planning has been invaluable. “They've come up with some really unique and exciting ideas over the years with different products and programs and approaches to our business,” he says.
The managers are invested in the strategic plan. Every department and branch agrees to follow through on the goals that relate to their function, and they are responsible for executing the plan. Recognizing that the world of business is fluid, they can update the plans as the year progresses. “It's been a very, very useful tool in helping us do the things that we need to do to grow,” Lakoff says. While the planning session happens once a year, Lakoff says there are “ongoing conversations day to day” about what's being accomplished and what's not.
The strategic planning session is also an opportunity to review new product offerings and how they could help their customers grow their business. “We're constantly evaluating products and where the industry is moving to,” Lakoff says. “What can we share with our contractors and where are there new and interesting ways for them to grow?”
While Ed's Supply is always looking ahead to new products and services, they are firmly rooted in their existing relationships with manufacturers. “Ed's Supply has and always will have strong relationships with our vendors,” Lakoff says. “We look at them as part of our business. Without them being successful, we can't be successful.”
Ed's Supply also provides customers with training for the nontechnical side of their business. Whether it's their in-house training facility or through outside consultants, Ed's Supply has specialized training on issues related to sales, management and customer service - essentially, what it takes to run, maintain and grow a business. Ed's Supply started this training in the early 1990s as a way to differentiate themselves from their competitors and “bring something different to the table,” Lakoff says.
A common thread that runs through the entire Ed's Supply operation is the way that they communicate with one another and with everyone up and down the supply chain - from the customers to the vendors. This open communication begins at the top - and there's a lot of history there. The three Nashville principals, Byram, Hall and Lakoff, have been with Ed's Supply in one shape or form since they were teenagers.
They all began working at Ed's Supply part-time in the summers and during school holidays. Byram's father, Jimmy, joined Ed's Supply in 1964 and later became a partner, Hall was a family friend of another partner and Lakoff's father was Ed's Supply's outside accountant and attorney. Hall joined full-time in 1979, Lakoff came aboard in 1981 and Byram started in 1990. By the mid-1990s, they had become the management team - the “go-to” guys for the business, with each having a clear set of responsibilities: Byram's expertise is in finance, while Lakoff is in charge of operations and Hall handles sales and marketing. They all became principals in the business in 2000.
Just because they've been around each other for so long does not necessarily guarantee a smooth relationship. Hall says there is a mutual trust and respect among one another that has guided them through the years. “We talk through all of the major decisions and have open lines of communication,” he says. “The same is true with our partners in Arkansas and Chattanooga.” Adds Lakoff: “To me, the biggest word is trust. I trust them like they're my brothers and my family. There is open and honest communication.”
Michael Maynard is a contributing editor based in Providence, RI. He writes frequently on HVACR, construction and architecture issues. Contact him at [email protected].
Ed's Supply Co. at a Glance
|Partners:||Steve Byram, Lincoln Lakoff, John Hall, Scott Brewer and Ernie Sanders|
|Headquarters:||Nashville, TN; Chattanooga, TN; Little Rock, AR|
|Major Product Lines:||Rheem, Mitsubishi Electric, Sporlan, Copeland, Honeywell Controls, Honeywell Genetron, Hart & Cooley, DuPont, Southwark Metal, Knauf, Mueller|
Strategic Planning - Once a year, all of our branch and department managers meet to build a three-year strategic plan for our company.
Definition and Example: During the two-day event, we discuss new ideas and plan on how we, over the next three years, will work to be a better company. Growing on what has been successful in the past and implementing new ideas that will continue to help us improve.
Significance: Putting all of our key management people in a room together with no outside distractions for two days, just to talk about things that work and things that we need to change. Everyone is involved!
Benefits: Time spent together outside the office environment. Pulling from the number of years of experience in the industry, our group has really come up with some great ideas over the years.
Procedure: Roundtable open discussions
People involved: All branch and department managers
Timing: Late fall and early winter
Cost: The cost of food and a place to stay
Other considerations: We want to make sure we continue this process because it has added so many good things to our company over the years.
Contact: Lincoln Lakoff, 615/244-2600, [email protected].