Cover Story to continue to do well and improve it. That said, I may be old fashioned, but I still think personal one-on-one sales are best and create the most loyal customers.” Many dealers have said the “buy local” movement has helped their office products business, which seems true of jan/san too. “I used to think it didn’t matter,” admits Miller. “But with all the consolidations, now people seem more surprised to find a company that is local and competent than they were one or two years ago.”
Advice
When asked for pearls of wisdom to share with office dealers keen to break into or expand in jan/san, Miller attributes his advice to a colleague: “A gentleman I worked with said if you are just starting and go after bigger pieces of business—say $50,000 to $100,000—when you are just starting, they are more complex. If you lose the account, you will feel shut down, like you can’t do this and it’s not the business you want to be in. It whittles away at your confidence. Going after the $1,000 to $2,000 a month business is much more palatable, whether you build from scratch or buy a company.” And Miller has some further practical guidance: “You won’t be able to buy direct until you build up the business, so have a couple of wholesalers—at least two—that, if you show them growth, will support you. Then pay your bills on time. This is very important. It means you need a line of credit and other financial backing. Without it, if you are starting in jan/san, you will just be chasing your tail. Many companies are stretched for cash, so they want longer 60-day terms to pay. You want to give them that flexibility but also pay your supplier. If you can’t do both, it can be a barrier to entry and you’ll be out of the game. You need cash flow, which is the biggest challenge facing dealers no matter what business you are in.”
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FEBRUARY 2023
From a jan/san association president’s perspective Despite inflation, the continued threat of a recession and lingering supply chain issues, Ty Huffer—vice chair and president of The United Group (TUG), a leading buying group for the jan/san industry—sees a lot of opportunity for independent dealers in the sector. “My wife and I used to laugh when she was an executive with the Estée Lauder cosmetics company,” he says. “We’d say our industries may not be recession proof, but they are recession resistant, since women always need lipstick and other cosmetics; and everyone needs toilet paper.” He believes this still holds despite the significant consolidation going on in jan/ san: “There are a lot of acquisitions in our space—many companies are trying to become these massive companies while others are trying to become big enough to be bought out, and I see this continuing in 2023. But people still want that personal touch: they want to pick up the phone and talk to someone. It’s a huge opportunity for independent office product dealers.” However, he believes the opportunities hinge on several factors. “I say this with love in my heart and not to be rude, but it’s like being pregnant: you can’t be half pregnant,” he warns. “If independent office product dealers want to sell jan/san products, they need to invest in people and inventory. They can’t learn it on the fly. They have to be able to hire a jan/san specialist, someone with years of experience in the industry. They also need to invest in inventory or use a redistributor like RJ Shinner, Essendant or R3 Distribution.” He also believes success depends on expanding beyond traditional jan/san products. “2020 was a record year for our members and us because of all the personal protective equipment,” he explains. “But in 2021, we topped it, thanks to food service disposables, containers and bags that restaurants needed for takeout orders. I don’t have the numbers yet for 2022. But our members are on track to match 2021—this time because of packaging supplies and the increase in e-commerce.” And what does he predict will be the big seller for 2023? “A combination of all three,” he suggests. “In jan/san, the prices of gloves and masks are going down, but people are returning to work. It may be a hybrid model, but they are still in the office two or three days and need clean spaces. They need chemicals, towels and tissues. And e-commerce is not going anywhere. The UPS truck is at our house so much that my wife has a personal relationship with the driver! Packaging will remain strong.” What other trends does Huffer see escalating this year? “There’s going to be more focus on sustainability, on green cleaning,” he forecasts. “Some places like California and New York are banning Styrofoam and plastic takeout containers, so they will need alternatives.” Huffer encourages independent office product dealers to join and use TUG as a resource but says many already are members, although they may not know it. “We give our members access to 200-plus manufacturers and service providers, such as AT&T, consultants and HR companies,” he explains. “We have an affiliate program with Independent Suppliers Group and AFFLINK. So, if you are a dealer and a member of one of these two groups, you are a member of TUG.” INDEPENDENT DEALER
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