Dealers active in janitorial sales have increased their knowledge, added experienced staff and started to compete at a much higher level. Success has opened up sales for new product lines and expanded sales of existing products.
By Michael Chazin
In the last decade distribution of janitorial supplies has changed dramatically as increasing numbers of independent office products dealers have entered the category. At one time traditional janitorial distributors pretty much had this category to themselves. That’s no longer the case as independents, big boxes and online sources have all entered the fray. More recently, the market has intensified still further as new entities, such as Home Depot’s HD Supply division, have arrived on the scene and existing players have forged new alliances to bolster their position.
In the past five years, Innovative Office Solutions of Burnsville, Minnesota, has seen its janitorial supplies business triple. Ryan Burgwald, chief sales officer, explains that the dealership has emphasized facility sales and expects growth to bring the category up to 24 percent of sales. “We’ve moved into different verticals, have added personnel and have a greater focus in this category beyond selling,” he says. “There is a tremendous growth opportunity in this category and we can absolutely compete in most situations.”
Eaton Office Supply in Amherst, New York, has experienced similar category growth. Janitorial products now account for 12 percent of overall sales dollars, up some 30 percent compared to just three years ago. Eaton’s started its Jan/San journey back in August of 2008 and in January of the following year joined the AFFLINK Jan/San buying organization. “It was a good opportunity to learn that product category quickly, who the vendors were, to build relationships and come up with a market plan,” says Bob MacDonald, product category manager for janitorial supplies.
Eaton’s expects to be up two or three points per year in facility supplies. A lot of that growth will come from communicating with existing accounts and letting them know these supplies are available. “Because a lot of people still go to the wholesale club to pick it up or struggle to deal with a local janitorial dealer with minimum order requirements,” says MacDonald.
Sales of janitorial supplies have grown for the past decade and become a large part of daily life at Walker’s Office Supplies in Auburn, California. Following the addition of a janitorial specialist in 2010 the dealership started to do small bathroom makeovers. The dealership went in with a package of paper towels, toilet paper, seat covers, soap, air fresheners and free dispensers. “Bite the bullet and give them free dispensers, hang them for free and stuff them,” says Jarrod Anderson, president and owner. At that point, he adds, the dealership becomes the source for a whole new category with that customer.
Focus on bathrooms
The experience gained through redoing customer bathrooms enabled Walker’s to gain a deeper knowledge of the janitorial category. So many times, says Anderson, dealers move too quickly and try talking to their customer’s facility director before they’re even ready to have that conversation.
After doing one bathroom at a time for a few years, the experience gained enabled the dealership to win larger janitorial sales.
Innovative adopted a similar strategy, concentrating on essential restroom supplies. The offering encompasses towels, toilet paper, can liners and soap. “We could keep it super simple, train on that and our sales reps who are not janitorial specific could go out and have that conversation,” says Burgwald. He talks about focusing on what he calls “the center of the plate” and keeping the conversation simple.
Innovative sales reps take this offering to their customers and are supported by category experts who can continue that Jan/San conversation for more demanding opportunities.
Burgwald says that this process has uncovered a range of possibilities that define bathroom aesthetics. “You can walk into a bathroom, take a look and know that it isn’t up to par.” Often, he says, the dispensers will look like they have been up for a long time. “That’s a significant play for the office channel,” he says. If the bathroom looks out of date, it’s probably an easy conversation to have as the current supplier isn’t doing its job.
Innovative built on its early success with bathroom makeovers and moved into broader facility sales, targeting, among others, property management firms and K-12 school systems. Organic growth in the category led to deeper associations with chemical suppliers and then an equipment provider. “We feel that we’ve graduated to the next level and can be that complete janitorial solution,” says Burgwald.
Facility supplies is the fastest growing category at Storey Kenworthy, Des Moines, Iowa. “From outside the front door, through the building and out back to the dumpster, we can take care of every single need that the customer has,” says John Guenther, facility solutions specialist. Current office products customers readily provide warm introductions to the person in charge of facilities. “We also scout out bigger players in the market who don’t currently do business with us,” he says.
Through an association that one of the owners has, Storey Kenworthy has established a reciprocal sales agreement with a local janitorial dealer in Des Moines. “Their owner is close personal friends with our owner,” says Guenther. “They came to an agreement on how to move forward and increase business for both organizations.”
Storey Kenworthy has used this association to pick up new sales as well as benefit from direct manufacturer contract pricing using the dealer as the conduit. “Direct manufacturer relationships are still key,” he adds. “The Clarke equipment line was recently added to the Storey Kenworthy lineup and has added revenue streams not traditionally enjoyed in the past.”
More ways to grow
Buying a janitorial dealer is yet another way for an office products dealer to establish itself in the facilities marketplace. That’s the approach The Supply Room, Richmond, Virginia, took when it acquired a janitorial dealer in Richmond in the second half of 2017. “We were growing in janitorial, but it was really with our office customers,” says Yancey Jones Jr., COO. “Once we got that expertise it not only expanded our product line but it got us into verticals that we weren’t in with traditional office sales.” Those new verticals include manufacturing, food processing, automotive and healthcare.
TSR had janitorial specialists on staff already but with the addition of experienced janitorial supply salespeople their numbers have grown tremendously. “Their task is to grow the category with our general reps,” says Jones. “They go in as subject matter experts with our account managers to uncover opportunities.” The message to those generalist sales reps is you don’t need to become an expert. “We’re asking them to identify where the opportunities may be and then we can bring in the experts to close the deal.”
When Innovative Office Solutions first started to look at selling to property management firms it saw the need to join The Building Owners and Managers Association (BOMA). “We quickly learned that these people are all tightly networked,” says Burgwald.
In response, Innovative positioned itself as a community-minded seller and focused on establishing relationships. That approach paid off when the manager at one of the larger buildings in Minneapolis referred to Innovative as a “breath of fresh air”, commenting on its straightforward communications style, ease of online ordering along and the ability to purchase other product categories as key elements of the dealership’s value proposition.
At A-Z Office Resource in Memphis, Terry Hammond was first hired as a janitorial specialist and then moved into sales management covering Memphis, Nashville and Columbia Tennessee and Huntsville, Alabama.
After that move janitorial sales did a slight back slide until about nine months ago when a new specialist was hired. “The Jan/San segment is so large and requires so much specialty knowledge that our general office products people just don’t have,” he says.
“I think growth in our market is going to come from building service contractors,” says Hammond. As salespeople review their accounts and look at freestanding buildings with just one tenant, there is usually a contractor that comes in and supplies a full range of janitorial services. “It’s a difficult market to penetrate because the really big ones go direct,” he says, and the smaller ones each have their own challenge. “We are working with some contractors now to partner with them,” he adds.
Competition seems to increase every time a dealer turns around. “It’s getting tougher all the time with companies like Staples and even Lowe’s and Home Depot carrying housekeeping and janitorial products now,” says Hammond. “You can walk into Home Depot and buy a commercial grade cleaner, which would have been more difficult to do ten years ago.” It points to the fact, he suggests, that everybody is getting into the janitorial supplies space.
Competition depends on who the customer is, says Walker’s Anderson. “That’s why I stay away from public entity stuff because it’s just a field that I don’t compete well in,” he says. All the janitorial dealers are competing for this business along with Home Depot’s HD Supply. “When it’s just the little stuff you know you run up against Amazon, Costco and Staples,” he says. “If you are a sales rep for an independent office supply company and you add value to that customer, that’s a differentiator. But if you expect them to go online and reorder, there is no added value—then you’re not going to get it.”
In terms of vertical markets, Walker’s has done well with health clubs, golf courses and park and recreation facilities. “One sales rep is a gym rat and has all the gyms in the area,” says Anderson. Another salesperson is a golfer and counts every golf course in the area as a customer. “Churches also are wonderful janitorial accounts. They’re a perfect fit,” he adds.
There is a lot of local competition in the trading area of Kerr Office Group, Elizabethtown, Kentucky. “Those Jan/San houses have a lot of experts and they buy large volumes direct,” says Ed McCoy, vice president sales and marketing. The two biggest challenges Kerr has faced traditionally are pricing on janitorial items and access to all products. “We have the ability to go after most of that stuff now, either direct or through our buying group, so I would say that struggle is narrowing each year,” he reports.
The office supply channel has gained credibility and janitorial vendors are now ready to step in and work with office products dealers. “In the past Jan/San houses owned the industry and we were kind of snubbed, if you will, by the manufacturers,” says McCoy. Those days are definitely over. “We have penetrated accounts, we have the relationships, people trust us and we are taking business from traditional janitorial houses,” he says. “And that is happening across the U.S.”
In response, some janitorial dealers have started to go after business in the office products space. “They can’t match the service model of independent dealers but they’re trying to boost sales because their numbers aren’t growing,” says Guenther. “Some of those companies already deal with Essendant for janitorial items and have all the office products available to them,” he says. Historically they have not bothered to pursue those sales, but that is changing. “We are growing faster in their category than they ever imagined so they are trying to think outside the box to capture some of those lost sales.”
Specialists are necessary
As the specialist at Storey Kenworthy, Guenther has varied responsibilities. He keeps an eye on vendor relations along with the head of purchasing and works with the sales team to educate and assist in closing new business opportunities. “It’s my job to educate our customers and give them the information they need to make informed decisions,” he says.
Following the acquisition of a janitorial dealer, TSR discovered different roles for those janitorial salespeople. Some just continued to sell their book of business because of the number of accounts they had while others became category champions to help other TSR salespeople grow sales in the janitorial category, says Jones. “There are many new categories we’re asking our generalists to sell.”
Sales were already growing because the service model of next-day delivery and online ordering already appealed to janitorial customers. “We have been able to offer those customers who came over from the acquisition a much higher service level than they were receiving,” says Jones. New janitorial customers have also opened opportunities for additional sales. “If you walk into any car dealership they are going to offer you coffee or water,” adds Jones. “So we have added a breakroom offering for these customers.”
“One of the best decisions we made back in August 2008 was the transition of moving me from being a sales manager to a category manager,” says Eaton’s Bob MacDonald. In addition to sales he also focuses on sourcing. “We’ve been able to develop some good relationships because I have time to meet with vendors and manufacturer reps and they better understand what we’re trying to accomplish,” he reports. Typically MacDonald works with sales reps to establish a comfort zone with accounts to let them know that a single source can be set up for office and janitorial supplies with one invoice and one delivery.
Often specialists provide much-needed answers that salespeople gladly take back to their customers. Whether it is an epoxy concrete floor, an odor problem or a marble floor with stains they have somebody they can call. “When you tell a client you will bring someone by to look at it, you’re 75 percent of the way to developing a better relationship and closing that sale,” says Hammond.
Moving into machine sales
When Eaton’s first joined AFFLINK, an AFFLINK representative came to Amherst and introduced Eaton’s to another local dealer, also an AFFLINK member, that serviced janitorial and food service accounts. The two dealerships have chosen to work together rather than compete. “Our product niche is more of the small and medium-sized accounts and they’re more of the GPO and larger account niche—hospitals and other places we wouldn’t be cost competitive,” explains MacDonald.
The two dealers have gone to market together in a number of instances and split responsibilities where one does invoicing and the other handles deliveries. The janitorial dealer isn’t structured to readily handle a number of smaller orders, but that is Eaton’s strength. Together the two dealers have won business using the “One Western New York” approach. “We work co-cooperatively to support a broad category of businesses, from small business and non-profits, to our well-known local sports teams—The Buffalo Bills, Buffalo Sabres and Buffalo Bisons,” MacDonald says.
The relationship has also opened up opportunities for sales of cleaning chemicals and floor care equipment, with a dedicated representative from the local AFFLINK janitorial dealer who works with Eaton representatives on selling machines and bulk chemicals. “It’s really taken us into a niche in the market that a general office supply company would probably not get into unless they bought a janitorial supply house,” says MacDonald.
As janitorial sales at Walker’s expanded, the natural expansion led first to floor care products and then to floor scrubbers and vacuums. “Next thing you know they want you to repair the machines,” says Anderson. He partnered with a Jan/San dealer not directly in his market that handles machine repairs. “They have given me access to the Windsor line of machines which is a well-known name in the Jan/San world,” he adds.
A team from Kerr went to last year’s ISSA show in Las Vegas to scout out a machine line to represent. Three vendors visited the dealership and it ultimately selected the IPC Eagle line of machines, which includes scrubbers, buffers, vacuums and related equipment. Kerr technicians were trained and certified by IPC Eagle to provide service. That was in the first part of last year. Since then, the dealership has held two lunch-and-learns to let customers know about the new offering.
Customers were invited to the events, given lunch and presented with the machine line. “We’ve had great success with the program because it lets them see the equipment and get their hands on it,” says McCoy. “We have even done some demos where we let people take a machine and try it out in their facility for a couple of days.” A small area of the showroom has been tiled and set aside for display and machine demonstrations.
Inventory and sourcing both present challenges. Storey Kenworthy has roughly 300 janitorial items in inventory but that number isn’t static. “Being a stocking dealer allows us to decide if it’s more important to have product on our floor at a better cost versus using a wholesaler and paying a premium,” says Guenther. Inventory ebbs and flows depending on opportunities and the customer base. Sourcing is fairly similar as Guenther says the dealership makes use of every opportunity, including purchases made direct, through wholesale or through the buying group.
At TSR, Jones says that currently 70 percent of product is purchased direct and the balance comes through wholesale. “We want to be doing more direct because we want to be tied more closely with vendors,” he says. The ratio between direct and wholesale will probably remain fairly constant, but there’s always room for variations, especially when they are strategic. “In some instances we’ve used the wholesaler a little more because some products were not turning the way we wanted,” he says.
It’s not a requirement that dealers maintain inventory to compete successfully in the janitorial category. Innovative works closely with all of its suppliers, but looks to its wholesaler for more than 95 percent of its janitorial items. “Essendant has been a great partner ensuring we have the access to the right breadth of product and pricing to compete on large opportunities,” says Burgwald.
Support from janitorial vendors has been excellent at Kerr Office Group where, it seems, no request is turned down. A school system that the dealer works with was trying to standardize facility products across all schools. One vendor will help train the janitors and work one-on-one with them on how to strip and wax a floor. “The manufacturer is funding that,” says McCoy.
At A-Z, Hammond is appreciative of vendors who take the time to work with his office supply salespeople. There is just one problem: most of those vendors only want to go out and call on large customers. “That’s not what I look for from my vendors,” says Hammond. “I want them to go on a route with a salesperson as they make their regular calls to help them with the smaller and medium-sized customers as well. To me their customer should by my salesperson, not the end user.”
The janitorial challenge
While the rewards are certainly worth the effort, adding janitorial products to a dealer’s business can be more challenging than adding other categories. Everything is different—from the customer contact to the products and different suppliers with different processes. The best way to go after this category, Jones contends, is with a dedicated sales force. The general line salesperson can uncover opportunities, but as the category progresses and the products get more complex, a specialist becomes a necessity.
Dealers who have yet to enter the janitorial category or those who are struggling to gain a toe-hold need to remember not to make the offering overly complex. “You don’t need to be everything to everybody,” says Burgwald. “You can sell a lot of toilet paper, a lot of towels, a lot of soap and a lot of can liners without ever touching any of the other stuff.”
To make your business model work, “partner with a manufacturer, have that manufacturer come in, build a relationship and then sell that manufacturer,” continues Burgwald. “There is also an opportunity for the independent dealer to leverage the wholesalers and buying groups to deliver this category through traditional office supply channels.”
If an owner or manager wants to sell more janitorial products, but the sales force isn’t on board, then it might be time to make some changes, Anderson suggests. “If your salespeople are not doing it by now, it is probably time to hire more people or new people.”
Michael Chazin is a freelance writer specializing in business topics, who has written about the office supply business for more than 15 years. He can be reached at email@example.com.