ASA's New President: Education And Participation Key To Association Survival
Mark Theis, his brother, Jeff, and cousins Greg and Bruce run the H. W. Theis Co., a company founded by their great-grandfather, Henry W. Theis Sr., and grandfather, Henry Jr. Mark Theis has been in the business more than three decades, and held almost every position in his supply house, learning the details of the distribution business. He knows the old-fashioned ways of the plumbing wholesale market and sees the importance of adapting them to new technologies. His company outfits hospitals, clinics, school systems, factories and universities and has supplied parts for such notable projects as Milwaukee's Bradley Center -- home to the NBA's Bucks, the AHL's Admirals and the Marquette University Golden Eagles men's basketball team -- and Miller Park, the Milwaukee Brewers' new baseball stadium. Almost 70% of the business is commercial, but Theis notes they are making a push for the residential plumber as well.
"We have a lot of time and money invested in our showrooms and they need to be profit centers for us," says Theis. "We hope to continue to drive those sales through the plumbing contractor. We always tell our showroom appointments the value that the plumbing contractor brings to the channel of distribution. We hope that the plumber continues to see the value that we bring to the distribution channel as well."
Mark has a vision of where ASA needs to be. Although the association has taken lumps over the years because of consolidation, Theis sees a bright future ahead and says education and participation are the keys.
"We need people to understand all the benefits they receive because of the work ASA puts in," says Theis. "Defending our industry in Washington is something which benefits us as a whole, ASA members and even non-members. Plus the educational programs we provide can help distributors run a more profitable business. The more people recognize this, the more membership will increase."
Theis also extends this message to other wholesalers:
"For people who aren't members, why not join and give it a shot for a couple of years," says Theis. "It doesn't cost that much money and it's extremely beneficial. And when you join, get involved. That's the way to get the most out of the Association - participation."
We had a chance to sit down and chat with Mark Theis and ask him a few questions about his upcoming ASA presidency.
SUPPLY HOUSE TIMES: What are the top items on your agenda when you take over as president of ASA?
Theis: My two biggest concerns are membership and the convention. Our membership again this year has dwindled, in part due to Wholesale Distributors Association dissolving, and with wholesale and vender members not renewing. I feel that ASA still has trouble getting the message out as to why it's so important for our constituents to be a part of this organization. We do bring value, but for those who do not participate and for those that have never belonged it's hard to get that message across. Our educational programs have gotten stronger and our political arm has helped fight some good battles on Capital Hill that have helped every wholesaler in this country. I wonder how many small wholesalers have the clout to have defeated the 1.6 gallon toilet issue, or the hours of operation for our truck drivers and, last but not least, the death tax. How much will that cost you if that goes back to where it was after the ten-year period runs out?
My second big concern is where our convention and ISH North America trade show are going. Again this year Kohler will not be present. Most of the wholesalers and manufacturers that I have talked to want to see an every-other-year show. If the members want this, why has it not happened yet? It's one of the issues I would like to see our board adopt. We are in a 10-year contract with Messe Frankfurt, so I know there are some hurdles to overcome, but I think the manufacturers are really going to start pushing the issue.
SUPPLY HOUSE TIMES: What particular sets of skills and interests do you bring to your role as ASA president?
Theis: I've been in this business for 30 years and held just about every job in our company. I still run the day-to-day operations, and I feel I've got a good grasp of what it takes to make it in this industry. I have no trouble making tough decisions when they need to be made. And I still care about this industry. Although it's a tougher road now then ever before, there is still room for the small wholesaler in this industry.
SUPPLY HOUSE TIMES: Last year's dissolution of WDA came as a big shock to the industry. With regionals disappearing or consolidating, is the traditional structure of ASA and its regional affiliates viable?
Theis: Where the regionals are strong, there is no reason that our structure cannot continue to work as in the past. ASA brings forth the educational programs on a national basis through the endowment fund and continues to be the watchdog in Washington to protect our industry from detrimental legislation. But the regionals bring the ASA's educational programs to the local level. We have had two at MDA this year, one being a national education program, and one that we put together. They were both very well received.
Where there is no regional, ASA will have to fill that void if it wants to keep those members in the fold. In the old Western Distributors Association region, ASA is already working to set up some town hall meetings and educational programs on the local level with some of the volunteers in the area.
SUPPLY HOUSE TIMES: We're heading toward year two of ASA's partnership in ISH NA. Please give us your assessment of this trade show, and whether you think it will ever fulfill its promise of becoming the biggest industry event even for PHCP exhibitors and visitors.
Theis: The one thing that we as wholesalers should keep in mind is that there is a lot more to the convention than just the trade show. It's a wonderful opportunity to get together with your industry friends - wholesalers, manufacturers reps and venders - and the ASA convention has some of the best educational programs the industry has to offer. Being there is a way for wholesalers to support the efforts of the manufacturers that spend a lot of time and money to support our convention.
Messe Frankfurt is working extremely hard to make this and future trade shows the best that they can be. I feel that manufacturers, wholesalers, and reps would love to see one all-inclusive show.
K/BIS has an extremely successful show and at this time I don't see them teaming with Messe Frankfurt in trying to achieve this goal. The K/BIS people are not interested in having PVF people there. I think they really cater to a different clientele than we do. When a wholesaler goes to the ISH show, he's as interested in talking to the fitting and valve manufacturers as he is in the fixture and faucet people. So we still need a venue to bring all these manufacturers and wholesalers together.
If Messe Frankfurt can bring the ASPE people into the fold along with PHCC, ASA and the other ISH partners, they can have a very effective show for our industry. However, I feel it needs to be an every-other-year show. Again, that's what most wholesalers and manufacturers want to see, and the time for that to happen is now.
SUPPLY HOUSE TIMES: What does ASA do that buying groups can't or don't do for their respective members?
Theis: ASA brings educational programs, which I've mentioned before, to the industry. The Essentials of Profitable Distribution that came through the ASA's Education Foundation this year is a great example of that. It's a course that every one of our employees will receive before the year is out. It's just another example of what the membership can get through ASA.
Another example of what we do that differentiates ASA from the buying groups comes out of our Center for Advancing Technology. We've been working for more than six years to be the source for standardized transaction sets, standardized data and whatever else our wholesalers and manufacturers need to help them reduce their costs. Our new industry database is a great way that ASA's investment into the technology arena is paying off.
I look for my buying group to bring me the programs that can keep me competitive in my area and help my bottom line. We also get some of our marketing ideas at our buying group meetings. From both venues I'm exposed to the networking that I find extremely valuable in our business.
SUPPLY HOUSE TIMES: What are the biggest challenges facing the PHCP industry and how is ASA helping wholesalers address them?
Theis: Increased competition. In the Milwaukee area we now have 16 wholesalers serving 1.3 million people. And that does not include the Home Depots, Lowe's, Sears, Farm & Fleets, etc., that also sell the same products we do. But the one big advantage that we have over those other outlets is our people. We train them better, pay them better, and treat them better. That is why our ASA educational programs are so important. We need to find a way to bring wholesalers who can't attend the seminars -- due to their size or location -- a means to get the education through electronic commerce.
SUPPLY HOUSE TIMES: What are the biggest problems you face in the business day-by-day? Do you think these problems are unique to your company, or do they reflect wider industry concerns?
Theis: As I said, the main problem is increased competition. Every time a new wholesaler comes into town it grabs a little piece of the pie. And with the Home Depots, Lowe's, etc., the end user has the ability to buy the material without going through the plumbing contractor. The plumbing contractor can still make money on his labor, but the wholesaler loses out completely when that happens. Wholesalers in other parts of the country tell me they have gone on to sell retail themselves. I believe that this is a trend that will continue if plumbing wholesalers want to remain viable in residential plumbing.
SUPPLY HOUSE TIMES: What are some of the solutions from your point of view?
Theis: Partnering with your best customers. Be loyal to the customer that is loyal to you. And keep your promises. We are a people industry and people make mistakes. But your customer doesn't care about that. They just want the problem solved and in the end that's what you've got to do. That's not always an easy lesson for a business owner to learn, and I'm no exception.
SUPPLY HOUSE TIMES: How has the industry changed since you started in it?
Theis: When I came into the industry 30 years ago, the channel of distribution was pretty well defined. The plumbing material pretty much went from the manufacturer to the wholesaler to the plumber to the end user. That certainly is not the case anymore. Today, end users can buy the same material any plumber can get for them. Doesn't mean they are getting it any cheaper, mind you, but they can get it.
Thirty years ago there were seven wholesalers in Milwaukee. Each of us had our core customer base and, as long as you took good care of them and were price competitive, they stuck with you. Today, an awful lot is based on price only. I've seen customers drive across town for a 1-2% difference on a faucet or fixture. You can't be the cheapest on everything, and no one is.
The third biggest difference is the saturation of lines. There was a time when one or maybe two wholesalers might have a specific line or item. Today, everyone has everything. That's come about with wholesalers expanding and bringing their lines into your area, and the manufacturers wanting to increase their numbers. So being exclusive to a line today is pretty much over. I think that is why some of the big companies are having product made for them under their own labels. It can give them a competitive edge.
SUPPLY HOUSE TIMES: Where do independent wholesalers such as your firm fit into the industry's scheme of things? Do you feel your future is as bright as it was, say 20 years ago, before so much consolidation took place?
Theis: I feel we still play an important part in the distribution channel. We can react fast to market conditions in our area. We can take care of a customer's problem or complaint immediately. When a manufacturer or manufacturers rep walks in with a new line or item, we can tell them on the spot if it's something we wish to try or not. From what I've heard, that's not always the case with the larger companies. We still have to bring value to the distribution channel to remain viable. I believe companies like us do that. <<
Three locations -- Brookfield, Oshkosh, and Burlington, Wis. The 60,000-sq.-ft. Brookfield operation houses its corporate offices and main showroom. The Oshkosh facility has a small showroom and about 20,000 sq. ft. of office and warehouse space. The Burlington operation, which opened in 1998, is a 12,000-sq.-ft. warehouse.
Jeff Theis, president; Mark Theis, vice president; Greg Theis, vice president; Bruce Theis, executive vice president.
All of eastern Wisconsin from the Illinois border to Green Bay, Wis.
Commercial and residential plumbers, with work in some hospitals, clinics, school systems, factories and universities.
Henry W. Theis Sr. was a master plumber and inventor with a small shop in Milwaukee when his son, Henry Jr., joined his father as a journeyman plumber in the 1920s. They set up a small machine shop and assembly facility in their garage to manufacture Henry Sr.'s invention, which was known as the Theis Ballcock, which featured a removable seat. When Henry Sr. died, his son took over the business, but because of a lack of knowledge about patent rights, other companies began making the ballcock and distributing it, making it difficult for Henry Jr. to turn a profit. He then established his own wholesale plumbing supply business on June 15, 1927.