Circle Tool Supply

Circle Tool Supply picWhen it comes to customer service, Circle Tool Supply exceeds expectations by providing its customers with timely and affordable products.
By Bianca Herron

Like all independent industrial distributors, Circle Tool Supply (CTS) faces the familiar challenges of a crowded, competitive market targeting the same customers. That’s why the Hammond, Ind.-based company must supply its products quickly, economically and flexibly when called on, President Chris Byrd says.

CTS has two warehouses and offices, located at its Indiana and Kansas City, Mo., locations, where it stocks thousands of products. These include hand and cutting tools, abrasives, power tools, safety equipment, MRO supplies and material handling equipment that helps its customers’ manufacturing processes.

Thanks to its many partnerships with suppliers, CTS also has access to hundreds of thousands more products, according to Byrd, and the company’s product offering is not limited to what is found in its warehouses.

“The typical inventoried items we carry – including safety gloves, earplugs and safety glasses – are based on the customer demands and are available and delivered when needed,” Byrd says. “Running any business successfully is a matter of managing dozens of unrelated variables and running a distribution company is no different. Our philosophy is simple: We purchase the items our customers want, and deliver them when and where they need them.”

Valuing Customers

CTS prides itself on providing the best manufacturers’ products at a level of customer service that goes above and beyond, Byrd says. “We understand the crucial role we play in the day-to-day operation of businesses we serve and do everything possible to exceed customer expectations,” he relates. “Relationships are essential to doing business on a repetitive basis, but you have to keep reinventing yourself to keep up with the competitor trying to take your business. You have to entrench yourself into the customers’ business as if it were your business, and we have tremendous customers that support us as much as we support them.” Circle Tool box

CTS’s customers include contractors that work at steel mills and refineries, OEMs, municipalities and chemical processor companies. According to Byrd, the company’s No. 1 approach with its customers is to look for and provide opportunities to cut cost and save them money. “We develop a working plan with input from all departments – safety, maintenance, purchasing – and then implement and report the cost savings,” he says.

Team Effort

Running a successful business cannot be done with “just one guy on top,” Byrd notes. That’s why the company employs “knowledgeable, solutions-oriented associates” that emphasis saving its customers money.

“Our associates are compensated in part on their cost savings performance to the customer, which is contrary to all other distributor associates that are incented on selling more volume at higher margins,” he says. “For example, let’s say a customer is buying a certain name brand of gloves. Our employees know we can offer the same fit and function at a lower price. The only difference is that our gloves may not be name brand.

“So because our employees help save our customers money, they will come back to us,” Byrd notes. “We document that on a quarterly basis. That way we can show customers how much money we saved them per quarter. So we compensate the employee for that cost savings because the customer turns into a repeat customer. In addition, for being rewarded, our employees will continue to look for cost savings for the customer. It’s an incentive that is a win-win.”

It’s not only CTS’s employees that make a difference, Byrd continues. The company also works with its suppliers to ensure they have the necessary information about each of its customers. 

“Honestly, I wouldn’t have been able to start the business unless I had relationships with the vendors,” he explains. “When we started the business five years ago, in the first six months I spent more time working and talking with the suppliers trying to get set up as a distributor than I did talking to new customers. If I can’t buy it, then I can’t sell it. The supplier-distributor relationship is just as critical as the distributor-customer relationship because we have to be able to buy competitively and get products when we need them.”

Close Collaboration

In addition, CTS continually networks with several groups and is part of several key industrial organizations that help support its efforts. One of the company’s key partners – and a group Byrd says offers tremendous benefits to the independent distributor – is the NetPlus Alliance, which brings together distributors and top manufacturers to grow their businesses. 

“NetPlus Alliance supports independent distributors with resources and incentives that promote profitable relationships,” he explains. “National and regional meetings enable us to network with companies that share our passion to grow and run successful independent businesses. It’s the only way we can compete against the billion-dollar national brands from coast-to-coast.”

In this way, CTS has continued to accelerate its growth even in a weak economy. “We had 30 percent growth last year,” Byrd says. “We just completed our budget for 2017 and the salespeople are guaranteeing close to 35 percent growth, so we’re looking at a phenomenal upcoming year.”

Ultimately, creating value and helping customers operate more efficiently is what Byrd is most proud of, he concludes. “I left a good-paying job at a billion-dollar industrial distributor company. I didn’t have to leave and take a risk to start my own company, but I’m really proud of how we’ve grown and how the customers have really partnered with us,” he says. “We’re helping them save money and we’re doing it the way they want it done. I’ve learned that each customer is different and they want things done in their own individual way. That’s why we conform to what they want. That’s the passion that got me into this business in the beginning.”

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