Growing an Enduring Legacy

Aug. 23, 2013
HVACR contractors in Ohio and western Pennsylvania know that wherever their customers are located, there’s most likely a Robertson Heating Supply nearby. Within this region alone, there are 28 Robertson Heating Supply branches, or roughly a branch every 30 miles. And that’s not counting the three Robertson Heating Supply branches in Michigan.
Scott Robertson
HVACR contractors in Ohio and western Pennsylvania know that wherever their customers are located, there’s most likely a Robertson Heating Supply nearby. Within this region alone, there are 28 Robertson Heating Supply branches, or roughly a branch every 30 miles. And that’s not counting the three Robertson Heating Supply branches in Michigan. “We really dot the map,” says Scott Robertson, president of the company.
Robertson Heating Supply’s 31 branches are a testament to a family-owned business that has been in growth mode since John Robertson, Scott’s grandfather, started the company in 1934. “For really all of its history, the company has always been looking to grow, and we’ve always been financially positioned so that it could grow,” he says.
John Robertson started out installing Stoker coal furnaces but soon recognized a need for a local supplier for the furnaces (at the time, contractors would have to drive two hours from Alliance, Ohio, to Cleveland to pick up a stove). By 1947, Robertson was in the plumbing business. He points to his grandfather’s decision in 1953 to expand the business and build a 60,000-square-foot building as an example of his ambition to grow. “Back then, that was gutsy,” Robertson says. “He put a lot of his money and personal finances on the line. It takes guts and commitment, but obviously it worked out.”
The Robertson family as well as its management team made a similar decision in 2001 when the company had outgrown its headquarters and distribution center, which had expanded over the years and included a building across the street. A new building and distribution center would accommodate future growth, but it would be costly and put them back into borrowing mode. Ultimately, they made the leap and completed the 284,000-square-foot building in 2004, which allowed the company to continue with its plans for growth. “Building this was a very good thing for our company. It let employees and our customers know that we were in it for the long haul and that we weren’t going to rest on our laurels,” Robertson says.
Today, the company’s business evenly splits between plumbing and heating. Robertson notes this is an advantage in smaller markets where its contractor customers also are split evenly between plumbing and heating. Robertson Heating Supply focuses on the residential and light commercial markets. About five percent of its business is in kitchen cabinets and countertops, which they sell directly to builders. 
Robertson Heating Supply began to expand outside of northeast Ohio in the 1960s with new branches. Acquisitions, which began in 1984, have since become a larger driver of the company’s growth. As Robertson notes, most markets have become so saturated that it’s very difficult to succeed in a new market by opening a new branch.
Its 31 branches spread across three states and span major metropolitan markets like Cincinnati, Cleveland, Columbus and Detroit as well as suburban and rural markets like Grand Rapids, Mich. and Cranberry Township, Pa. Robertson calls the diversity and distance of the markets a large challenge for the company. For example, Grand Rapids is a six-hour drive from the Alliance headquarters. “It makes for some long travel days when we’re trying to hit branches that are a half-day drive away,” Robertson says. 
For customers, however, it doesn’t matter how far their local branch is from headquarters. Twenty-one of the 1 branches receive overnight shipping five days a week through the company’s “night shuttle” program. Started 15 years ago, Robertson Heating Supply’s night shift fulfills the work orders from the branches while everyone else sleeps. For example, a customer faxes an order at 3 p.m. for next-day delivery. The branch will electronically send the order to the distribution center. By midnight, the order is filled and on its way, via trailer truck, to the branch. It arrives by 5:30 a.m. For the branches that are farther from the distribution center, a second delivery truck will transport the shipment from one transfer branch to the outlying ones.
While the markets may be diverse, Robertson has noticed that customers in all of these markets have high expectations when it comes to service and price. Robertson says the Internet has created an expectation among customers, particularly those in smaller markets, that they will receive the same type of service as contractors in larger markets. “Twenty to 30 years ago, we could manage branches in small markets with less inventory, higher prices and slightly less frequency of delivery,” he says. “Today’s contractors – and people in general – want instant answers, instant delivery service and best pricing.” While this creates challenges for the company, the night shuttle program is one of the ways that sets them apart from others.
Midnight shuttle
 “It’s very powerful and unique,” Robertson says of the program. “When your alarm clock goes off in the morning, you know that your material will be at your branch ready for pickup or delivery to you. That’s the commitment that we make to you – we’re working late enough in the evening and early enough in the morning.”
Branches can also respond to the needs of their market because Robertson Heating Supply branch managers have latitude to make inventory adjustments. “We don’t want them to have to jump through three levels when it comes to inventory,” Robertson says of his branch managers. “We think that it’s important that they can do that on behalf of the customers.”
While Robertson Heating Supply has grown to 260 employees and 31 branches, Robertson remains very involved throughout the organization. “Everybody here will tell you I’m a very active owner, very passionate, very competitive,” he says. Robertson Heating Supply is a lean organization, with five regional sales managers reporting to Vice President of Sales Geoff Alpert, and four regional operations managers reporting to Vice President of Branch Operations Don Lemley. “I’m very involved not just with our officers but with the regional operations and sales managers.”
At his core, Robertson is a salesman. “One of our unique strengths is that we’re not so large that the owner of the company has lost touch with reality or doesn’t really know his customers or employees,” he says. You can find Robertson on the road eight to 10 times a year with a salesperson calling on key accounts. “One of my favorite days of the year is when I get out and call on customers.”
Recognizing the importance of cultivating new customers, Robertson Heating Supply places a premium on winning their business. That is, salespeople receive higher commission rates for calling on customers that have done business with Robertson Heating Supply for less than three years. “That’s when the real selling is taking place – when the customer is in their first or second year with us. At that point, you’re not an order taker, you’re an order maker,” he says. “Many companies say new accounts are important, but we’re paying for it.”
Not only does the company pay for it, they also report out the sales numbers to their staff on a monthly basis. This goes beyond just sales figures. Robertson Heating Supply wants all of their employees to be invested in the success of the company, so they keep them apprised of such yearly internal goals as sales, profitability, inventory, training and technology. Meeting those goals is the basis for all employee bonuses, which gives everyone plenty of motivation to succeed.
The company and the employees faced a stiff test during the recent economic recession when the residential and light commercial markets froze. Robertson said everyone in the company “tightened their belts” through wage cuts and mandatory time off. As business returned, employees saw a restoration of hours and pay. If any lessons were learned, Robertson says it was the value that employees placed on their jobs, creating even greater motivation for them to do their jobs well every day. 
Robertson employees have, over the years, proven their loyalty to the company. Robertson says 78 of its 260 employees are members of the 20-year club – that is, 20 years of employment with Robertson Heating Supply. “We have employees who have the right attitude and who care about the company and our customers,” Robertson says. While Robertson Heating Supply has a number of ongoing technical and product training courses, he notes that “attitude” is not among those courses. “We can teach them the HVAC business, but we can’t teach them attitude and morals and ethics,” he says, adding that they look for employees who fit the culture of the company.
That loyalty is a two-way street. Robertson Heating Supply counts many long-term customers who appreciate the company’s commitment to service and its wide range of products. One of Robertson Heating Supply’s largest and most successful marketing activities is its buying show, held at three sporting venues throughout the year. Most recently, Robertson Heating Supply hosted its buying shows at Ohio State Stadium in Columbus, Heinz Field in Pittsburgh and Cleveland Browns Stadium. “Many of our dealers are sports people, so it’s a natural venue,” he says. Shows like these give top customers an opportunity to talk with Robertson Heating Supply’s management team and meet with key vendors. 
Robertson Heating Supply’s incentive trip program for top customers has also been an important way to build and grow relationships. The program, which has been around for about 30 years, is something that customers look forward to each year. There are two trips each year – in February and early March – to allow for a greater number of contractors to attain the goals and participate. The trips also allow Robertson to get to know the top customers personally. 
Another enduring feature of Robertson Heating Supply has been its pricebook, which they print and publish to about 650 of their customers. Robertson Heating Supply has its own printing department and continually updates the guide for its subscribers. John Robertson began the pricebook in 1947, and Scott Robertson says it’s something that customers have come to expect. While the company grows, it hasn’t forgotten the things that have made it so successful over the years.
Robertson heating supply at a Glance President & CEO: Scott Robertson, president Vice Presidents:
Ed Robertson, executive vice present; Kevin Duro, vice president, Operations; Don Lemley, vice president, Branch Operations Geoff Alpert, vice president, Sales; Scott Middleton, VP Marketing
Headquarters: Alliance, Ohio Operations:
31 branch locations serving Ohio, Michigan, western Pennsylvania and northern Kentucky
Employees: 260 Major Product Lines:
Rheem HVAC and Water Heating, Tempstar, Weil-McLain, Bosch Geothermal, Cerro, Mueller, Honeywell, Aprilaire, Lukjan, Majestic, Hart & Cooley
Website: Year Founded: 1934

Best Practice

Annual Corporate Goals

  • Definition and Example: At the start of each year, our management team meets and sets approximately seven internal corporate goals, which include the key performance areas of sales, profitability, inventory, training, technology and others.
  • Significance: The process allows the company to set challenging but attainable goals, which require participation and effort from nearly all employees.
  • Benefits: Other than the end results of achieving goals, there are benefits in team building, company-wide communication and developing cross-functional teams throughout the company.
  • Procedure: After goals have been set, each objective has a team of 10 to 15 members who take ownership and lead the necessary action, policy and procedure to accomplish their specific goal.
  • People involved: Every company member has the ability to assist in achieving the success of at least one goal.
  • Timing: We set and announce our goals in January; teams meet and measure throughout the year. We gauge final results at the end of November.
  • Cost: We pay a monetary incentive to all employees, basing it on the total number of goals achieved. Every employee earns the same amount and is paid in mid-December before the holidays.
  • Other considerations: This best practice has assisted us in achieving many successes, both externally to our customers and internally to our team and processes. It is the best practice that develops best practices.
  • Contact: Scott Middleton, vice president marketing, [email protected].
Michael Maynard is a contributing editor based in Providence, RI. He writes frequently on HVACR, construction and architecture issues. Contact him at [email protected].