Mike Miazga 2015-11-09 00:48:19
TELLING IT LIKE IT IS Incoming ASA President Tim Milford gives his candid take on the industry and the importance of the national trade association he will lead starting in January. Tim Milford always is in a forward thinking mode. He sticks to that tenet whether it’s as president and CEO of St. Louis-based Milford Supply, as a member of the Embassy buying group or in his upcoming role as the American Supply Association’s 2016 president. “You cannot stand still in life or in business,” he says. “You have to keep moving forward.” Milford recently sat down with Supply House Times at Milford Supply headquarters in the South County section of St. Louis and provided candid insights on his company’s progression, the constantly changing PHCP-PVF climate and his take on ASA and its importance to the industry. When it comes to Milford Supply, Milford says the company has embraced change and that openness to adapt new and diverse strategies has helped it compete in an extremely competitive marketplace. Since Milford’s father, Tom, and his uncle, Robert Allan, started the company in a parking garage near Sportsman’s Park (the old home of Major League Baseball’s St. Louis Cardinals) in the late 1960s, the company has expanded to its current-day six locations, which encompasses the headquarters location in South County, branches in Jefferson County (via acquisition), St. Charles County, downtown St. Louis and mostly recently Webster Groves (through the acquisition of Soulard Supply in July), as well as a Kohler showroom in suburban Fenton. “We took on the Kohler line so we opened a Kohler showroom (where Milford’s wife, Rita, is the showroom manager),” he says. “We opened a branch in St. Charles County because that’s the fastest-growing county and it’s all residential. We opened a branch in the city that caters more to the rehabber and property-management people down there. We bought Soulard Supply because they specialize in parts. We keep evolving.” A further part of Milford Supply’s evolution has come through keeping a pulse on how the supply chain has changed over the years. “There are more opportunities out there than there used to be as far as selling,” Milford says. “Back in the day, the contractor installed for just about everybody who needed plumbing done. Now, every school district has its own maintenance department and each one purchases plumbing supplies. There are 91 municipalities within St. Louis County and each has a public works department and they all need plumbing products. There are so many property-management companies out there that run apartment buildings.” New customer opportunities, though, require much more than just making a sales call. “This is huge business for us, but you have to make sure you have people who know what they are talking about,” Milford says. “They have to trust that you have the ability to analyze and solve their problems. It might be cheaper by 20% for them to go to a big-box store and buy it, but they’re going to call Bob at Milford because Bob knows what is going on.” Milford also has a different take on the showroom side of the business. “I was one of the first people to take the showroom out of the contractors’ hands. The contractor still dictates on new commercial buildings and new homes,” he says. “Before, the contractor used to demand you don’t sell to the public. My dad was like that as well. There’s a lot more that goes into it now such as properly manning the showroom and the marketing dynamic. “This industry has mushroomed well beyond just the contractor. Now you have designers involved where you need to know not five colors from Kohler but 70 colors. It’s to the level where we simply are supplying material. At the showroom level we have designers dealing with people remodeling homes. Nobody remodels a home and puts in cheap stuff. Hey, let’s stay here 20 more years and put in cheap faucets — no. Instead, people want whirlpools, Roman tub fillers, oil-rubbed bronze and a one-piece toilet.” Milford Supply also has embraced the virtual side of the business. Through one of its branches, Milford started Water Heaters 911, a 24-7 emergency water-heater delivery service. The successful addition was done with little added overhead and focuses entirely on commercial emergencies. “It’s one of those things that came along in this day and age,” Milford says. “We didn’t add any people. We just have a guy who carries around a cellphone. We did beef up our stock a little bit, but other than that it’s been mostly marketing. Here’s what we do and here’s the phone number to call if you need a water heater at 3 a.m. We provide the service and people know we have it. For example, there is a manufacturing plant in Fenton that shut down one of its lines and needed a $600 part. They told us when the line shuts down it costs $1 million a day. We got them what they needed.” Milford, who started out as the company’s controller when he first joined the family business (his two brothers and sisters at one point worked in the business), has a law degree from St. Louis University Law School. He’s put that degree to good use at Milford Supply in helping contractor customers collect money owed to them. “We held a collection seminar for plumbing contractors,” he says. “You might be a great plumbing contractor, but that doesn’t make you a good businessman. You have to collect your money. We have people who come in and say customers haven’t paid them in two years. If I didn’t get paid from two or three guys each month, I’d be in big trouble. You have to do something about that. I enjoy helping them collect their money (Milford originally met his wife, Rita, on a collections visit in 1984). They have to be businessmen first.” INDUSTRY INSIGHTS Milford says he’s no different than other distributors in that he always has the best interests of his employees in mind. “There is a very fine line between profit and loss,” he says. “It’s just the competitive nature of the business. What did they say a wholesaler makes on average if everything goes right? 2%? What keeps me up at night is trying to always stay in the black and trying to keep profitable so I can pay your bills and give employees pay increases and be ready for the next thing that happens. Health care is a huge concern. It’s very difficult to tell employees you have to pay more for your health care.” To that point, Milford has an open door policy where employees can see exactly how the company is performing financially. “I am an open book,” he says. “If I can’t show my employees where we are financially, they can’t know where we are going. What if they don’t understand what gross profit is? My job at Milford Supply is to continue to keep peoples’ focus on the business knowing I have their futures in mind in taking this company to the next level.” And Milford knows another major differentiator going forward will be in the customer service department. “Who wants to be known as an awful outfit that never does anything right and will be out of business by the end of the year?” he asks. “When people walk into your business, they walk in not because they are your friends, although they may be your friends, but because you provide something for them better than someone else whether that is location, value or service. They don’t want to go to someone who doesn’t have material or gives them the wrong product. Even if they don’t like you, if you can make them money, they will keep coming back. People respect people who know what they are doing.” ASA: A DIFFERENCE-MAKER Milford, whose son, Tim Jr., joined the company last year in inside sales and already is a mainstay at buying group and ASA-related events, first got involved in the industry at the regional level with the old Mid-America Supply Association. He later became president of the Midwest Distributors Association (MwDA) and then worked his way up through the chairs of ASA’s Executive Committee. “I saw the value for myself,” he says. “Being able to talk to someone outside your own area where you can open up without it coming back to you in a competitive nature is important. It helps you figure out how to get your supply house moving in the right direction. It’s a damn tough business environment out there. I enjoy meeting people. The relationships in this business are so important.” Milford has watched ASA undergo a metamorphosis during the last decade. “A needed change in leadership at ASA occurred,” he says. “They have the right people in place led by Mike Adelizzi (ASA executive vice president) and have a great vision. Part of it is they got their finances in order. When you belong to an organization as a paying member you want to trust the numbers are correct and you want to know where your money is going. We have that here.” Milford marvels at the evolution of such ASA specialty groups as the Young Executives and the ever-growing Women in Industry Division. “Women in Industry might be the biggest thing that’s going right now,” he says. “ASA has opened my eyes to a lot of things because it continues to explore the possibilities.” Milford Supply takes full advantage of many ASA-related educational and training programs. In particular, Milford swears by the association’s annual Operating Performance Report (better known by its OPR acronym). “ASA puts it out there to become better businessmen,” he says. “It’s your choice to use it or not use it. I love being able to go to the bank and say look at these statistics put out by ASA. Here is where I am. The guy at the bank tells me he would do anything for me but he needs help when he goes to the loan committee. I’m able to give him something to show that loan committee. ASA provides me my own business intelligence.” As for his time as president that starts Jan. 1, Milford notes no reinvention of the wheel is necessary. “We have an excellent wheel already,” he says. “I want to see us continue to engage the membership and continue to provide value for not only your dues, but your time.” Milford adds he would not be able to perform his upcoming ASA presidential duties without the help of Milford Supply executives JeffHenning (VP of operations), Jack Milford (VP of purchasing) and senior Vps Bob Miromonti, Ron Kaup, Dan Milford, Gary Payne and Tom Militzer. “I could not do this without their superior talents and performance on a daily basis,” he says. Milford’s elevator pitch to non-ASA members is based on his own life changing experiences. “The people I want to be like are members of ASA,” he says. “The people I want to look up to are members. I don’t want to be like the guy trying to do it on his own who says he doesn’t need anybody. If the people I consider to be leaders in this industry didn’t want to be associated with ASA, do you think I would be associated with ASA? Hell, no. I want to be associated with the best and the best in this industry are ASA members, hands down. ASA is important to me because it’s important to people I look up to. I wouldn’t have the business I have today if it wasn’t for ASA.”
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