When Larry and Peggy Cohen cut the ribbon in April to officially open Star Supply's expanded 165,000-square-foot facility in New Haven, CT, it marked a new era for the company. The facility accommodates the inventory for this growing company, but a look inside reveals much more: customer-friendly counters that allow for quick pick-ups, easy access to salespeople, warehouse space for greater in-stock selection and a spacious training area. This focus on the customer — and employees who make it all happen — is what has made Star Supply the company that it is today.
At the center of this growth for the 47-year-old company is Star Supply's president and CEO, Larry Cohen. He has held the top job within the company since 1979. Cohen, who has been working at Star Supply since the age of 13, can say he has held virtually every job within the company. Cohen's father, Seymour, began the company in 1959 as a corner store in downtown New Haven. Over the years, Star Supply has grown into a full-service operation that meets and exceeds the needs of its customers throughout Connecticut and western Massachusetts. Like other family-owned wholesale distributors, Star Supply has seen the HVACR wholesaler market dramatically shift. But the company has managed to grow its business in a fiercely competitive marketplace — ultimately retaining its customer relationships during this positive change.
Cohen attributes Star Supply's growth to a number of factors, including the dedication of his employees, many of whom have been with the company for more than 30 years. It also has a loyal customer base that understands that value is more than just the lowest price, and partnerships with manufacturers such as Trane that have propelled the company in new directions.
The new facility in New Haven is perfect for a company with a strong emphasis on pleasing its customers, being located near Interstates 91 and 95. Star Supply was outgrowing its 112,000-square-foot facility in New Haven when the building, which formerly housed a radiator manufacturer and was only five minutes away, came on the market. Within four months, Cohen had acquired the building, and one year later, the company was in business there. Cohen is proud to report that the company made the transition without disruption to its business.
Because the building is a big, open space, Cohen was able to lay out his vision for how an HVACR distributor should function. “It's in one facility, so here I can have all of my people and all of my inventory under one roof,” he says. Inside, the design facilitates communication among departments and customers. “Our customers can talk to our technical people or our accounts receivable,” he explains. “We've built the desks right into the counters so that when a customer walks in, there's always somebody to greet them.” And with its proximity to Interstates 91 and 95 and its own fleet of trucks, Star Supply gives all of its customers same-day or next-day delivery.
With its extra space, Star Supply has expanded product lines and its product offerings, Cohen says. For example, it has been a distributor of the Mitsubishi mini-split systems for years, but it could not offer the entire line. Now that Star Supply has more room, it is selling more Mitsubishi systems. “It's given customers another reason to do business with us,” Cohen says. “We can have more complete product lines.”
They designed the training area as an open, comfortable room with all of the necessary multimedia equipment for a variety of presentations. Training encompasses all aspects of the HVACR distribution business, including sales, management, business and computer training sessions as well as product and equipment seminars with Star Supply's manufacturers. The company employs two in-house trainers and also utilizes outside consultants for its sessions for both employees and customers.
A major component of Star Supply's employee training involves understanding the customers' business as well as what goes on in the other departments within the company itself. That's why Cohen is comfortable with hiring people from outside of the HVACR business. He looks for people who bring the intelligence, innovation and the desire to grow and work hard — Star Supply will teach them about HVACR.
Two Star Supply employees, for example, recently underwent an 11-week training program. “Neither one of them came from this industry, but they're tremendously talented people,” he says. They'll work in all of the company's departments and then go out with HVACR contractors to learn how they do their jobs. “They'll have a better understanding for what the customer wants when they come in here,” he says. “You need to see the market firsthand and how to reach out; this will only make you more valuable to our customers. And you can't understand that until you go out and get your fingers dirty.”
Knowing what their co-workers do and how they do it is valuable on several fronts. First, it creates more flexibility within the workplace. When calls swamp customer service, someone from purchasing can pitch in and help. Second, it has created a more cohesive and inclusive environment within the company. Fewer turf wars mean a more productive workplace. Cohen reinforces this with a weekly meeting among the departments. Whatever the concerns, the interdepartmental meetings provide an opportunity to bring them up, resolve them and move on.
All of this training, education and internal communication pay off for Star Supply's customers. Cohen is relentless in making sure that the customers are getting what they need quickly and accurately. The average time for a walk-in customer to place his order, get the order and get out is about six minutes, says Cohen. “We're pretty proud of that.” He knows this because the counter supervisor tracks the transactions as part of a detailed report, which is available for later analysis. The objective is to always look for ways to make improvements and figure out how to fix any recurring issues.
Cohen is also proud of the personalized service that begins when a Star Supply receptionist answers the phone. That's right: a real, live receptionist who will direct calls to the appropriate person or department. “That's a feature that's important to me, and it separates us from the competition,” Cohen says. “I will not tolerate an automated phone service.”
The company recently added a new measure of self-service and flexibility to customers. If a contractor needs material immediately and cannot make it to Star Supply by closing time, an employee will place the material in Star Supply's night pickup room. With a personalized code (which changes every day), the customer can get the material and be on their way. A security camera ensures the customer's safety and the integrity of the transaction. Cohen says the night pickup room eliminates the burden of having an employee open up the business in the middle of the night while still fulfilling a need for his customers.
Since Cohen took over the company in 1979, he estimates it has grown 12 to 15 times, with its biggest growth spurt coming in 1991 when it became an independent distributor for the Trane Co. “That's been a tremendous partnership for both companies,” he says. “They've helped us grow, and they've given us a lot of resources to help train our contractors.” It was a natural partnership, he adds. With Star Supply's reputation and loyal dealer base, and Trane's brand-name recognition among consumers, its outstanding line of high- quality products and an outstanding staff, Star Supply has quadrupled its equipment sales since the partnership began.
The Trane Co. has recognized Star Supply for their success by bestowing on them 25 awards for excellent work. The company's technical representatives have also received awards from Trane — special recognition for two consecutive years as the best in the business.
Being the best is more important than having the lowest price, Cohen says. Even in a market area where there are 30 to 40 competitors, including national and regional distributors, Star Supply's customer service commitment and technical expertise win out, Cohen says.
They are now doing business with many of the second-generation contractors, he notes with pride. “We were very successful with their dads, and now we're doing business with their sons and giving them new opportunities to grow,” Cohen says. “We'll work closely with them and say, ‘Your dad got your business going. We want to get you to the next level,’” he says. They appreciate that Star Supply is doing more than selling them products, they're a true resource.
Star Supply works hard to stay ahead of the competition. But Cohen will be the first person to tell you that the company “plays hard” too. That benefits both Star Supply's employees and their customers. “We do some very fun events that are first-class,” he says. The company hosts all-expenses-paid trips for top customers every three to four years that have become true events. The most recent one was at a first-class resort on St. Kitts that brought together customers and Star Supply sales representatives, totaling approximately 225 people. The all-expenses-paid outing solidifies customer loyalty and provides Cohen and his staff an opportunity to discuss new programs and products. “The relationship-building that we do is irreplaceable.”
For Cohen, business is personal. “Our customers are also my friends,” he says. He enjoys spending time with them, learning about their business and working cooperatively to make both more successful. He also enjoys excellent relationships with the manufacturers and counts them as true partners. “Without those relationships, you cannot be successful,” he says. “You want to do business with your friends.”
And his friends like to do business with Cohen as well. While the resort trips may be once every few years, Star Supply's golf tournament is an annual event. And it is a major event for the company and the customers alike, drawing 240 golfers and more than 300 people for the dinner. “My country club does an outstanding job, which leads to great food and service,” Cohen says. The 2006 tournament marked its 11th year, and it continues to grow. “Everybody walks away a winner,” Cohen says.
As Star Supply moves forward, Cohen says the company plans to continue working and playing hard. He and the management team have projected continued growth over the next five years. Through June, company sales had increased about 20 percent over the previous year, and Cohen expects that to continue.
Such growth serves as a model for his customers. Cohen says he tells his customers that they can never have enough growth — that they need to continue to build their business and build loyalty. It's wise advice, especially coming from a successful company that has followed this philosophy for almost 50 years.
Michael Maynard is a business writer in Providence, RI, who writes on issues related to HVAC, construction and architecture. Contact him at [email protected].
BEST PRACTICE
Definition and Example: Our best practice is to maintain a focus on improving our customers' business and helping them build their operation with every encounter. Our training efforts attempt to help our customers become better businesspeople and do not focus strictly on technical applications. By offering a broad and deep inventory and flexible delivery schedule, we demonstrate to our customers the job economies they can obtain in taking advantage of our offerings. Having all of our technical capabilities centralized in one location further crystallizes the efficiencies we try to help our customers realize.
Significance: Efforts to take the time to learn our customers' business, their needs and obstacles, and help direct them to overcome obstacles and offer solutions only propel our business.
Benefits: With this approach, our customers begin to look at The Star Supply Co. as a resource, not only a wholesale distributor of HVACR. This, coupled with our customer service and response time, keeps them coming back.
Procedure: To take the time to meet with our customers and understand what they truly want to accomplish provides us with a baseline. We'll then provide a solution/answer or guidance — depending on what the need is.
Michael Maynard is a business writer in Providence, RI, who writes on issues related to HVAC, construction and architecture. Contact him at [email protected].