Rick Peterson, president of All-West Fasteners, Seattle, WA, a regional industrial fastener and electronic hardware and components distributor, recently spoke at the Specialty Tools and Fasteners Distributors Association convention and trade show in Denver, CO. He is the group’s outgoing president. The event drew nearly 4,500, down from the past two years but not far off 2005 attendance.
In his speech to the attendees, outgoing STAFDA President Rick Peterson touched on business practices his company has benefited from. One of those: Vendor Managed Inventory (VMI). The goal of VMI, he says, is to make sure the customer’s production line or job never shuts down due to a product shortage, and to minimize the total cost of supply.
Our VMI program has played a key role in the growth of our company,”Peterson says. “… It can work for you on anything you sell that has reasonable usage predictability.”
Another program Peterson has seen success with is what he called NCNR, or Non-Cancelable/Non-Returnable agreements.
“I originally came from the ‘handshake’world of construction and industrial supply where you could always work out a compromise if a special order ended up gathering dust,”he says. “But because so many of the items we sell are truly ‘special,’we learned to protect ourselves by using NCNRs.”
NCNRs, he says, are binding agreements that say the customer will take delivery of special products within a specified time period. The customer must acknowledge the provision before a distributor accepts a large purchase order for special items.
Peterson’s third suggestion to STAFDA members was to make sure terms and conditions protect a distributor from product liability. “We are the distributor, not the insurer against all things bad in the universe,”he says. “No single customer is ever so valuable that you should agree to indemnify them.”
Peterson says that the “green movement”is affecting how everybody does business.
“Rising energy prices, renewed concerns about the environment and technological breakthroughs have thrust the green movement into the forefront of public thought and action,”he says. “There’s a green component to almost every aspect of the business world -transportation, construction, purchasing and shipping.”
Peterson encouraged attendees to look at their own facilities from a green perspective and to make sure mechanical systems are working in a coordinated manner, that computers are set to hibernate when not in use, that efficient lighting is used, to cut down on air conditioning usage, and to use shading controls to reduce thermal heat gain through windows. Not only does “going green”save water, gas and other resources, but most importantly, he says, it saves money.
“For most of us, a recession would not be a new experience,”Peterson says.
Peterson pointed out in his STAFDA speech that the “real economy”of spending, production and jobs is “hardly in a state of collapse.”Exports have buoyed GDP growth, and consumers have continued to spend. Interest rates have fallen. “STAFDA members, as they have so often done in the past, will need to shift their sales emphasis to commercial, industrial and other market sectors,” he advised.
Distributor Touts VMI, Green Practices
In his speech to the attendees, outgoing STAFDA President Rick Peterson touched on business practices his company has benefited from. One of those: Vendor Managed Inventory (VMI). The goal of VMI, he says, is to make sure the customer's production line or job never shuts down due to a product shortage, and to minimize the total cost of supply.
Our VMI program has played a ...
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