Louisiana distributor uses industry partnerships to bolster presence.
Earlier this year, lightning struck Nelson Equipment Company, Inc. (NECI), resulting in a power failure, telephone malfunctions and a blown-up computer server. For three days, the company had no access to its invoicing capabilities and customer accounts. Power was restored three days later, but this ordeal was an eye-opener for the company’s second-generation president, Mark Nelson. “It can be devastating when you lose that technology the way we did. That’s when we realized that the old, paper-pushing way of doing things is gone.”
This experience helped Nelson realize that the strong partnerships he and the company have developed over NECI’s 36-year history have really paid off. “We don’t want to just buy products from our suppliers. We truly want them to be partners. It has really been beneficial to our company.” Depending on his suppliers to get his business up and running after the lightning strike is only one example. Nelson constantly looks for advice, from the copier salesperson all the way to his insurance agents. “It’s difficult for us to do the research to find out what we should be doing, so we ask our suppliers to lead, guide and evaluate us against similar peers in our industry. We also rely on them to bring customers to us.”
Developing partnerships within the industry has enabled Nelson Equipment Company to fulfill the words of its mission statement, “People dedicated to quality.” The mission statement goes on to mention goals such as working as a team, improving the productivity of the customers they serve and responding quickly to changes and trends.
From Forklifts to Systems
The mission statement provides a fairly simple formula for success, one that has guided Nelson Equipment Company since its establishment in 1968. Founder Jack D. Nelson worked at Clark Equipment before purchasing his own forklift distributorship in Shreveport, Louisiana. By the late 1970s, the company began to look more heavily at engineered systems and systems integration. “My father asked me to take the systems side of the business and develop it so it could be spun off into a separate company,” Nelson says. During the time he was doing this, his father decided to sell the company. In 1981, an asset sale was completed, leaving just a shell of a company. Mark Nelson used the systems knowledge he had gained and the interest it had created to restructure the business into its current form.
Mark invited his younger brother, Kurt, to join in 1982. Since then, the brothers have meshed their skills, complementing each other’s strengths to turn their company into a very successful material handling business. Mark is responsible for the sales and marketing end and long-term planning, while Kurt, now the vice president, handles the day-to-day operations. In addition to the Shreveport headquarters, the firm also has a branch office in New Orleans and a sales office in Baton Rouge.
Serving the Entire Marketplace
With roughly 300 miles between the two main branches, a lot of hard work is required for everyone to remain on the same page. In addition to numerous phone calls, extensive travel occurs between the two branches. “Sometimes I have to travel and work with salespeople, look at customer requirements, meet with our service technicians and make sure they have all the tools they need. It definitely keeps me busy,” Nelson says.
Still, he finds enough time to take to market four major product types from a host of vendors. The company primarily focuses on conveyors, storage equipment, dock and door equipment, and ergonomic equipment such as lift tables. As one would expect with such a broad array of products, the company also has a broad array of customers. “Louisiana is a small market, so in respect to that, we have to look at every segment of the marketplace as a potential customer,” Nelson states. “We don’t have the luxury of looking solely at one market and focusing all our efforts there.” The company does business with manufacturing, both light and heavy, as well as automotive, food, wood, paper and warehousing companies.
Regardless of the market, Nelson Equipment Company attacks it the same way. “We’re still pretty much old school,” Nelson explains, “and we like that one-on-one, person-to-person marketing strategy.” Each employee is trained to seek out sales, even those employees who aren’t salespeople, such as service technicians who look for opportunities while on sites. The company also utilizes electronic means of marketing. Nelson explains, “We revamped our Web site at the beginning of the year to make it more interactive. We are developing it for e-commerce, but more importantly, as a technical site so that our customers can garner technical information.”
Developing an Online Presence
Nelson is expanding the Web site’s capabilities as a customer service tool by building individual personal sites for customers so that they have account histories, maintenance manuals and other tools. Nelson admits that this is a work in progress, but is confident that it will be a boon for business in the not-too-distant future. He’s seen positive reviews from customers’ maintenance departments, who can use the site to place or check orders in the middle of the night when no one is in the office.
The Internet has provided the company with an opportunity for more cost-effective training through webcasting. As Nelson points out, both manufacturers and distributors can save money by eliminating travel expenses, all while having multiple parties gaining the consistent training across multiple locations. “We’ve not utilized this to the extent that we should, but it’s just a matter of breaking down some paradigms and being open to change,” Nelson says.
Another online feature has provided more positive customer feedback. Although Nelson Equipment Company is not in the used equipment business, it does perform retrofits that often leave the customer with surplus equipment to sell. In order to spread that information to a broader audience, Nelson will post that information on the company Web site. He is also certain to pass the tip along to salespeople so they can be aware of products for which other customers may be looking.
The Web site allows for 24/7 customer service, one of Nelson Equipment Company’s calling cards. Nelson says that when he restructured the company, he took a somewhat benign attitude toward sales and marketing, relying more on service. “I said we would be happy to be only a secondary supplier for equipment, but we wanted to be the first ones for service.” That has evolved into the omnipresent Web site and customer support capabilities. “Our technicians are always on call unless they are sick or on vacation, so within a couple of hours somebody’s going to be there fixing their problems.”
Other technological advancements help with the customer service initiative and lead to what Nelson jokingly refers to as the Dick Tracy Syndrome. Much like the comic strip hero’s do-it-all watch, cell phones have become the multitasking equivalent in today’s business world. “In addition to using them to make calls, our salespeople send and receive e-mails through their cell phones so they’re basically wireless in an office environment.” The company’s telephone system will automatically call a salesperson’s cell phone if a customer leaves a voicemail. “We tell customers who leave messages that if nobody calls back within 20 minutes, then they should call back and we will find that person.” This quick response time is monitored very closely, and is a feature on which the company prides itself because Nelson knows that customers often are operating under tight time constraints.
Importance of Communication
This is only one example of the strong lines of communication that exist internally and externally at Nelson Equipment Company. “One of the major things we look for when developing a relationship with a supplier is a high level of communication,” Nelson says. It goes hand-in-hand with field support, as far as Nelson is concerned. Not surprisingly, Nelson values rapid response time from its suppliers. “A supplier can offer support, but if it isn’t on a timely basis, then it is pretty much worthless,” he remarks. A supplier’s willingness to support a sale, even if it requires more hands-on activity from the factory level, is also important. “Some people tell you that they will help you over the phone but that’s as far as they’re willing to go. That doesn’t get it done in this business,” he adds.
Internal communication is equally important. As products and technology constantly evolve, it is a necessity to keep employees apprised of new features and information. Nelson Equipment Company achieves this through various methods, including educational sessions at both the factory and in-house levels. The in-house meetings take the form of what the company calls roundtable meetings, either at the company headquarters or at a branch office. The Shreveport facility has a training room that is also used for customer training.
The roundtable meetings allow for each member of the sales force to learn at his or her own pace, while maintaining the interactive communication. “We don’t have sales meetings just for the sake of having a meeting, but with our sales force scattered about the state we have to communicate daily,” Nelson comments. “The roundtable environment is more one-on-one, a more intimate environment than a typical sales meeting.”
The intimate environment is another company attribute of which Nelson is quite proud. Calling it “one big family,” he points to the lengthy tenures of his staff, including several people with 10+ years of service. “When you have that much tenure, it’s uncanny the knowledge base that’s there. Our people know and understand the customers so well that we can answer questions even if that customer’s particular salesperson is away.”
Nelson believes the company’s culture of openness is a contributing factor to employees’ decisions to remain with the company, again illustrating the importance of communication. “We have an open door policy. The only time my brother or I have our doors closed is if we’re meeting with someone one-on-one. The rest of the time, anyone is free to approach us.” More than that, though, Nelson believes in giving his employees the ability to make decisions. “We encourage our employees to think independently and be accountable for their decisions. It is very beneficial for individual growth,” he explains.
Another method of increasing camaraderie amongst the workers is using annual incentives. For example, service technicians get a salary override from any business they generate. If the company has a specific product that it is promoting heavily, incentives can take the form of a dinner or a day off to those who successfully sell the product. “We try to be creative,” Nelson relates. “We’ve sent people to Disney World or airfare for a long weekend anywhere in the United States. We try to mix it up and keep it interesting.”
Looking to the Future
It was certainly an interesting business climate the last few years, something Nelson doesn’t wish to repeat. The recession and business lag that accompanied it was a tough experience, but one that Mark Nelson took some lessons from. “We realized that we cannot be all things to all people,” he explains. “If we’re going to keep our quality service reputation up to a level unsurpassed by anyone, we must focus on what we do well, become very good at it, and not lose sight of that. So for the future, we’re really refocusing on what we’ve done in the past.” Emphasis on core products, steady reliance on continuing education programs, productivity enhancements and benchmarking all are ways Nelson plans to maintain the company’s focus.
The Louisiana economy usually lags the general national trend by about a year, so when Nelson hears good news from other parts of the country, he is optimistic that his business will soon pick up. So he knows that the survival mode that was enough to get through the last few years isn’t going to be enough to get the job done in coming months. “That’s not how you sustain and grow a business. It’s all about attitude; you just have to get up each morning and make sure each day is a good day.”
With Nelson Equipment Company’s dedicated people, it appears that plenty of good days are on the horizon.