Ask the management staff at Landover, Md.-based Harry Eklof & Associates what makes the manufacturers representative firm so successful, they will tell you it’s the relationships the company has with both distributors and contractors. But the glue that holds those relationships together is training — technical, hands-on training.
“We’re selling service, not product,” says Ken Herne, sales engineer for Eklof’s HVAC department. “Successful reps focus on service through training, which includes live, hands-on product training. When we’re trying to introduce new technology, the easiest way to do it is to have the mechanics’ hands on it.”
Herne is a former contractor, as are others in the company who work with contractor customers. As a contractor, he made buying decisions based on who provided him the best service. With thousands of good products on the market, the only way for a rep firm to distinguish itself is through product training.
And that’s what Harry Eklof & Associates delivers. It has a training center at its corporate offices with five live-fire stations and other products available for study. On-site training also is provided at wholesale distributor locations.
“Distributors and contractors want technical training,” states Dennis Stinson, HVAC department manager for eastern Pennsylvania and New Jersey. “They trust us to tell them what they need to know to install the product correctly and not give them a sales pitch. The worst thing than getting no sale is a bad sale.”
And as manufacturers have become leaner and unable to produce the product literature they once did, Harry Eklof has taken on that job as well. Eklof associates also have worked with manufacturers on beefing up their national training programs that provide contractor accreditation, going so far as to become NATE proctors, not a typical rep function, Herne explains.
“When we go to a jobsite and recommend a change to one of the product lines on the project, that contractor is not looking at a typical salesman — he’s looking at an educated, product-knowledged salesman,” he adds. “I think that’s the No. 1 thing that distinguishes us as an agency. We know what our products really do.”
And while Harry Eklof & Associates does participate in golf outings, fishing and other activities with contractors, it’s not the bread-and-butter of the business.
“Our relationships with contractors have been less entertainment-based and more technical training-based,” says President Gary Eklof, the second-generation owner of the company. “Over time, I think that creates a stronger bond.”
During training sessions, Eklof associates hand out their business cards to the contractors present, with the instruction to call the associate at any time — including late night and early morning — if he runs into a problem at a jobsite. Herne fields about three to five of those calls each year, as do others on staff.
“We provide that service for every product we have in our warehouse,” says Jack Schulz, vice president of plumbing sales for Maryland, Delaware, the District of Columbia and northern Virginia. “Our sales guys spend 65% to 80% of their time with contractors — helping them on jobsites, consulting with them about product and understanding their jobs.”
The rep firm employs people with the expertise to handle very technical problems or other, less-technical issues that need to be addressed on a jobsite.
“That may not be unusual for manufacturer rep firms who sell direct to the contractor,” Eklof says. “But everything we sell goes through a distributor. We don’t sell anything direct to a contractor. We’re at the jobsite with the distributor’s customer troubleshooting a job. I think we do that at a different level than most agencies do.”
Rick Coster, vice president of plumbing sales and operations for eastern Pennsylvania and New Jersey, notes another way the rep firm helps contractors is through its three distribution centers — the corporate building in Landover, with a 80,000-sq.-ft. warehouse; Richmond, Va., with 16,600 sq. ft. of warehouse space; and Moorestown, N.J., with a 32,000-sq.-ft. warehouse. Three warehouses makes it much easier for Harry Eklof to do direct shipments, even though the order is billed through a wholesaler to a contractor. Contractors are able to consolidate many different product lines on one order if they prefer.
“We believe that half of our responsibility is getting our products on the wholesaler shelf and the other half is getting it off,” Coster says. “It’s a partnership with us, so we go out to educate the contractor even if it’s something as simple as a ball valve. We want him to feel comfortable with the product and go to our wholesale partners and ask for that product.”
For the past few years, the role of the manufacturers representative firm has continued to evolve as manufacturers and distributors become leaner and pass on more responsibility to reps.
“Nobody is paying us more to do what we do; we’re actually paid less,” Eklof says. “Commissions are less but we are required to do more with less distributors. To do that, we have to influence the contractors more to drive that business. We’re calling on more people to get the job done — engineers, architects, property managers, builders — those people who can influence the sale of a product of a manufacturer we represent.
“To make a sale today, it may be five people you have to see instead of one.”
Harry Eklof & Associates is a buy-sell rep firm started in 1968 by Gary Eklof’s father, Harry Eklof. The company serves Delaware, Maryland, Virginia, 10 counties in West Virginia, eastern Pennsylvania, New Jersey and the District of Columbia. Income is derived from about 60% commodity items and 40% from specification items.
The company employs about 80 inside sales associates, outside sales associates, warehouse associates and project managers. The greater Washington area was not hit as hard during the recession, mostly because of government and military spending. Yet some areas are getting hit because of recent budget cuts. This is offset by increased spending in the private sector.
“Projects put on the back burner in 2008 and 2009 have resurrected themselves because they are easier to finance now,” Gary Eklof notes.
The area has seen a substantial increase in residential construction, Schulz says. In the greater Washington area, 26,000 apartments are currently under construction or were just completed. In the next 18 months, construction is to start on another 6,000 apartments.
“Some of that reflects a national trend where people are leaving the nest a little later but they need a place to live,” he says. “They can’t afford a single-family home so apartment rentals have been on the rise.”
Eklof adds that dual-income government workers also are fueling the residential construction in the area, as well as large companies coming in and increasing the workforce. And the recent military base realignment brought military personnel to the metro Washington area from across the country.
The company represents several green manufacturers and technologies — another area where Harry Eklof & Associates is providing more service to wholesaler and contractor customers than it used to.
“In the past, you would have expected the manufacturer to say that its product will qualify for particular LEED points,” Herne explains. “Now, those of us in the field have to figure out and help accumulate that data up the product chain line. It’s not a function of manufacturing anymore.”
Herne is an accredited GreenPlumbers USA instructor, one of the first 15 in the country. One of 10 homeowners will buy green, he says, but getting the contractor and that homeowner connected can be tricky. He uses his green expertise to help contractors market to green homeowners.
“Contractors who are successful in the green/sustainability area market themselves as green companies that install green products,” he notes. “The 10% of the market that wants to buy green for the carbon footprint reduction, energy conservation and reducing their water consumption are buying higher-efficiency, more expensive products. They want to make sure those products are being installed correctly. And that’s where Harry Eklof comes in. We show contractors how to spend the same labor hours making more money.”
Stinson notes the firm is getting the support of some of its manufacturers specific to air quality, in the form of marketing tools to help the contractor.
“We know with efficiency you buy it upfront, so we need to help contractors market it,” he adds. “Contractors are very good at what they do, but they need the additional support. How long is the payback? What’s the benefit for me? Can you give me some documentation? Can you give me a case study? Can you help me sell the product?”
The management team is quick to add that the company would be nowhere without its distributor partners. And the company is constantly looking at how it can assist the distributor/contractor relationship better.
“Through our distributors’ hard work and efforts to lead us to the right people, and facilitating some of the training we do, it truly is a partnership,” Stinson says. “We’re an extension of their sales force. When you look at a distributor who might have 30,000 SKUs to sell, that distributor is happy to have a rep firm it can rely on. What value-added services can we provide to help them?”
“New technologies keep coming into the market and we’re always looking for younger people to add to the staff,” Coster says. “The company has to keep growing and changing and I think we’ve done a good job.”
While Harry Eklof & Associates is continually looking for young, tech-savvy people to cover the increasingly more technical products coming from manufacturers, the company’s experienced staff is an advantage to manufacturers.
“We’re fortunate that people have been here for so long,” Schulz says. “When I first started 36 years ago, Gary was working in the warehouse and I know that wasn’t his first summer.”
R. Steven Price, vice president of plumbing/HVAC sales for eastern, central and southwestern Virginia, has been with the company for 31 years; Coster has 20 years at the firm; Stinson has 17 years with Eklof; and Herne has 15 years with the company.
“It says a lot to our wholesalers and manufacturers that we have the expertise in the industry,” Coster says.
When asked about the future role of the manufacturers rep firm, continually building and maintaining industry relationships was the top answer.
“We need to continue with new approaches to the marketplace,” Price says. “If we don’t, we’ll be left behind. The contractor is our lifeline. We believe three different segments exist in the contractor market: bid and spec, design/build and replacement. If you don’t know how to talk about those three markets with a contractor, you may not be successful.
“If we don’t continue to maintain that relationship, show the contractor that his single biggest expense is labor and show him ways to reduce that labor, then we’re not helping him.”
Schulz adds: “We need to give contractors the confidence to try something new and convince them the payback is worth it. If they’re going to invest the time and energy to learn how to do it, is it going to be around for a while?”
Eklof foresees relationships with the firm’s distributor partners and with contractors evolving in the upcoming years.
“I think the distributor will perform its true function and just be a distributor,” he notes. “I think the relationship between contractor and manufacturers rep will be much closer. But the distributor/rep relationship also will be closer because distributors need the technical support that reps can provide. We will be the experts on our product lines and they will rely on us more.”
He adds that Harry Eklof & Associates has been very fortunate because of the good wholesaler relationships it has.
“We could take many of our products direct to the contractor; it’s what our competitors do,” he notes. “But because we’ve always aligned ourselves with the distributor, we’ve been fortunate to get some lines because of distributor recommendations. We’ve never gone out and solicited a line. We’ve let our reputation, hard work and abilities speak for themselves.
“It’s all about relationship-building, getting ourselves in front of a decision-maker and providing the knowledge he needs about the potential savings he can have and then introduce other product lines we have. We’re always trying to put that whole package together.”