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Getting into retail
Although the mix and breadth of product have
expanded greatly over the years, the commitment to the customer and
to treating that customer like one of the family has remained the same.
That ongoing commitment has helped build the company into the successful
venture that it has become today and it will be that same commitment
that takes the company into the next stage of its development.
From the Beginning
When Nick De Giorgio decided to get into retail back in 1985,
he did so mainly as a way to access product that he needed for his job
as a carpentry contractor. He had no intention of building it beyond
anything but a line of fastening products and the 500 square foot retail
“store” remained pretty much a one-man operation for several years.
Over time, Nick’s family got involved in the business. His son, Domenic,
started in 1988 and his two daughters – Rose and Vinnie – also came
on board with their respective husbands Joseph Martino and Pino De Francesco.
But the company underwent a significant strategic change in 1993.
“Dad actually never worked in the store,” explains Domenic De Giorgio,
son of Nick and one of the three owners of IHL. “We bought it from him
in 1993.”
According to De Giorgio, the store has grown more than 10 times in size
since the day he and his two sisters purchased the company from their
father. The product line has been expanded well beyond the initial line
of fasteners to include a full range of: fasteners; power tools; adhesives;
hand tools; safety supplies; janitorial supplies; first-aid supplies;
electrical and plumbing contractors; and more.
“My father-in-law sold mainly nails and construction paper,” explains
Joseph Martino. “Today, we offer over 10,000 SKUs.”
The second-generation family has also grown the business in terms of
size. The initial 500 square feet has been gradually built up to 40,000
square feet – with 6,000 square feet available for retail space alone.
And the number of employees has followed suit, growing to a total of
26 today.
“For the longest time, we remained at a staff of five,” explains Martino.
“But that all changed about seven to eight years ago when we really
started expanding into other areas of business.”
That growth has taken IHL from servicing the forming industry exclusively
to also servicing the home building industry, the hi-res and low-res
forming contractors, the stucco contractors, the draining and concrete
industry, the trim woodworkers, the upholstery shops and the pallet
shops. “It was an intentional move on our part that has really contributed
to our growth,” explains Martino. “We looked at the situation and really
saw the need to diversify.”
The geographical range of the company has also changed over the years.
Today, IHL services areas as far west as Kitchener, Waterloo and the
Niagara region. It goes as far north as Orillia and Collingwood and
as far east as Kingston and Belleville.
The right service ethic
Along the way, the group of five has also invested
a lot of time and energy into building up a top-notch customer service
edict. And it’s been this commitment to that edict that has paid dividends
over the years.
“A lot of customers are friends,” says Martino. “We treat our customers
like friends, like they’re family.”
A lot of IHL’s customers have been customers of the company since day
one. “We know our customers,” says Martino. “I think it says something
to have customers who can come in and talk to the owners directly.”
There’s also the added advantage of not having to make an appointment
to talk to one of the owners and of knowing that IHL stands behind everything
it sells. “No sale is final until the customer is satisfied,” explains
Martino. “That’s our store philosophy and we stand by it. I will often
say to a customer ‘Try it out. Use it. And if you don’t like it, bring
it back.’ Our suppliers support us on this and they back us up on our
commitment.”
Finding the right people to complement the team – and free up valuable
time for the original five – isn’t always an easy task. But IHL has
managed to pull together a good group of people who have the same energy
and commitment to the customer. “It can be a difficult transition to
go from five people who are very hands-on to 26 employees,” explains
Martino, who adds that most of the staff came by way of word-of-mouth
and referral. “We’re all young and enthusiastic. All of us are in the
same age bracket and we all want to go places.”
Chris Brewer is an example of one of the team. He has been with IHL
for two years and comes from the rental side of the business. Although
hired primarily to provide service at the counter, Brewer is finding
himself involved in all areas of the company, including marketing. “It
is very hands-on,” says Brewer. “ And it all comes down to customer
service. Good service is the business mentality here and it works well.”
To better serve that broadening customer base, IHL is open from 6:00
a.m. to 6:00 p.m. Monday to Friday and from 7:30 a.m. to 2:00 p.m. on
Saturdays. And customer orders placed by 3:30 p.m. are delivered the
following day. To make those deliveries, IHL has several vehicles at
its disposal – everything from a small pickup truck to a large 24-foot
flatbed. And when there’s a problem with getting the product on the
truck on time, it’s quite common for the staff to pitch in.
“It’s a rare occurrence that we don’t go out and do a special delivery,”
explains Martino. “There are also times when employees have loaded up
product in their own vehicles and have dropped them off at construction
sites on their way home. We have a real team atmosphere here.”
Getting the word out
One of the difficulties in growing a business from
a single-focus store to a multi-purpose one is in getting your customers
to realize that you now carry everything they need. “We’re a one-stop
shop,” says Martino. “We have people who are very experienced in certain
areas so that we can offer our customers the product and the expertise.
We believe that the more you can offer your customer out of one location,
then the better it is for that customer.”
To help IHL better promote the full extent of its product offerings,
the company plans to have a huge showroom when it moves into its expanded
facilities in September 2005. The corporate move will coincide with
the IHL’s 20th anniversary and will result in a custom-built 50,000
square foot facility with a 10,000 square foot showroom. The new location
will be situated around the main city thoroughfares at highway 401 and
Weston Road. The actual address will be 127 Aviva Parkway.
The Grand Opening of IHL’s new facility is currently slated to take
place in October. It will more than likely coincide with the company’s
annual Customer Appreciation Day, which sees about 10 to 12 key suppliers
coming onsite to exhibit product specials.
“We’ve been holding these events for about 10 years now,” says Martino,
who adds that the annual event attracts some 400 to 500 customers. “The
suppliers come out and set up booths in the parking lot. There’s food,
drinks, games, prizes and lots of specials. Everyone comes out and has
a great time.”
Repairs and rentals
Yet another way in which IHL provides top-notch service
to its customer base is through a standalone separate company called
Vital Tool Repair and Rentals. Formed three years ago to service those
tools being sold by IHL, Vital Tool Repair and Rentals is its own profit
and loss centre.
”We believe in servicing what we sell,” explains Martino. “We realized
that we needed our own tool shop because it was taking too much time
to send the tools out to the manufacturers and then wait for them to
come back. In this business, you need your tools yesterday and can’t
afford to wait.”
The repair and rental company is located in the same site as IHL but
has a staff of four. Its current 1,000 square feet of space will be
expanded to 2,000 square feet in the new facility.
“We’re the authorized service centre for several manufacturers of small
tools,” says Martino, who adds that these brands include Dewalt, Milwaukee,
Hitachi, Makita, Honda and Stihl. “It’s a complementary side of the
business to IHL.”
Future plans will see this side of the business grow beyond small tools
into large equipment servicing, as well as an expansion of the rental
business.
The next 20 years
According to Domenic De Giorgio, the past 20 years
of IHL have been instrumental in establishing those business ethics
that have contributed to the company’s success. Now, he says, everything
is in place for the next growth phase.
“We believe that there is so much more we can do for our customers,”
he explains. “That’s why we believe in franchises.”
The long-term vision for IHL includes as many as eight franchises in
the next five years, not all of which may be located in southwestern
Ontario. Plans for the first are already well underway, with a long-time
customer of IHL opening an 8,500 square foot facility in the Milton
area in March 2005.
“We’re very excited about the venture,” explains De Giorgio. “It will
help service our customer base in that area of the province.”
At the same time, De Giorgio is quick to add that these types of franchise
partnerships will only succeed if there are like-minded individuals
working together. “It only works when someone is as driven and enthusiastic
as you are,” he says. “This particular individual has the same values
as us. In truth, it really comes down to hard work. There’s no secret.
It’s just a matter of putting in the hours of hard work and having the
commitment to succeed.”
And that success, according to De Giorgio, doesn’t necessarily revolve
around money. “I don’t really look at revenue,” he explains. “In fact,
we purposefully held our business back for a good many years because
we knew that we needed to first bring on good people. We slowed our
business down so that we wouldn’t be spreading ourselves too thin.”
Chris Brewer, one of those “good people” echoes De Giorgio’s sentiment.
“The drive here is to make the customer happy,” he says. “If the customer
is happy, then the business will come.”
According to De Giorgio, as much as the business has changed over the
last 20 years, the most dramatic change will come in the next five years.
“The demographics are going to change this industry,” he says. “Part
of our success has been in adapting to the needs of the industry. We
have always kept an eye on new tools and technologies. And we will continue
to do so that we can provide our customers with the products that they
need, not necessarily the ones that they ask for.”
A couple of core factors that will help IHL succeed in this brave new
world will be its well-established reputation, along with its never-ending
commitment to the customer. “A lot of people here are actually overqualified
for what they’re doing,” concludes De Giorgio. “But they’re doing it
because they know where we’re headed. We have a very loyal customer
base. And we work hard at showing them that we appreciate their business.
We’re not looking for the quick sell and the quick buck. Our name and
reputation means a lot in this industry. You can’t put a dollar figure
on that.”
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