What's Not In Stock?

Published: March 30, 2021 - by Dan Holohan

Categories: The Business of Heating

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I asked a bunch of heating contractor friends what was missing from their wholesaler’s stock and how they felt about that. They had some interesting things to say and I thought you might want to listen in.

One contractor who specializes in piping steam boilers said he missed American-made fittings and pipe. I’ve heard that from many other contractors in recent years. I don’t know what you can do about that, but I think you should know that if you are stocking American-made fittings and pipe, you have a good story to tell to a lot of contractors who want those pipes and fittings, even at a higher price. It’s just easier to work with.

Another heating professional said there was a lack of knowledge at the wholesalers when it comes to hydronics.

“There’s a lot to know these days,” he said. “Everything is getting more complicated and many of the suppliers are stocking multiple boiler and furnace lines, as well as AC lines. All of this needs dedicated training, and we’re not getting that from the wholesalers. I realize hydronics is a small percentage of the total market, and I’m sure that has something to do with the lack of knowledge, but if wholesalers are depending on the manufacturers to do all the training, the manufacturers must be wondering why they’re paying the wholesalers what they’re paying them.”

I guess that means it pays to be smart.

A contractor buddy in Alaska said, “They’re missing anything related to any kind of repair service for any kind of heating unit. Whenever I have a unit go down, the typical answer I get from the wholesaler is that they can order it. This generally sets me back about $60 for freight. I got a freight charge for a control board out of Canada the other day for $190.00. That hurts. But, nothing is worse than having a piece of equipment go down and the supplier who sold me the equipment doesn’t have any replacement parts whatsoever. I did manage to get most of the parts needed to fix the York furnaces that I was installing, but then my supplier changed brands. Now I have to restock more parts. And the wholesalers wonder why more of us are shopping online.”

Another contractor said, “Parts for modulating or condensing boilers are expensive and supply houses don’t stock much of those. It’s hard to tell a customer in the dead of winter that it’s going to take three days to get the parts to fix the unit I sold them. It’s not like the days when we sold only cast-iron boiler that hold a lot of water. If you have one of those you can always seem to get it running somehow.”

Another guy chimed in with this: “I guess the big question we should ask is who the seller is? Is it me or my wholesaler? I think it should be my wholesaler. I’m the installer. But it’s looking more and more like the wholesalers think we should be the sellers. When I put something in, I have a hard time finding that extra $1,200 or so it takes to stock the parts for it. This is especially true when the wholesaler keeps juggling their lines around. They can’t seem to settle on one or two good manufacturers. Now I’m supposed to have a massive amount of money sitting in spare parts for all the various units that are out there. I wish I could do this, but I just don’t have that kind of available cash flow lying around.”

And it looks like the wholesalers feel the same way.

Another pro had this to say: “I’ve been to wholesalers that sell six different brands of modulating/condensing boilers. Picture this across all the models and vintages, and how many parts such as circuit boards, inducers, and gas valves they would need to stock. When I finally settled on one brand and model that I would sell to all of my customers, I kept a complete boiler in stock as my parts back-up. It would be helpful if common consumable parts covered an entire size-range of a particular boiler model.”

I found the concept of having one spare boiler in stock that a contractor uses as a body-parts donor interesting. Does a wholesaler really need to carry so many lines of boilers? Does it pay to settle for one or two that will satisfy most jobs? Then you could sell that donor boiler along with your first sale. Maybe help with some financing on the donor to make the sale. Food for thought.

Some more things most wholesalers aren’t stocking that contractors want: Acid neutralizer media, solid concrete blocks, drop cloths, reducing-90s in the larger sizes, magnetic dirt separators, anodes for water heaters, and trained and knowledgeable employees.

Forty years ago, I spent time in the Catskill Mountains, calling on contractors who serviced the huge hotel resorts that were once there (think Dirty Dancing). I was representing Bell & Gossett and these resorts had a lot of B&G pumps that needed service. I came up with an idea. Suppose I did a complete pump survey in each resort and tagged every B&G pump with a number. Then I could put together a binder that showed all the information about each pump they had in service, what parts each took, and how to service them. Then, looking at the binder, I could boil down how many of the tagged pumps used the same parts. If the resort stocked just these bearing assemblies, those motors, these impellers, those couplers, these motor mounts, and so on, they would have everything they would ever need to fix any pump that ever broke down at the worst possible time. And they could do it without disrupting their guests.

When I had all the binders made I took them to the local wholesaler who sold equipment to the resorts and told those in charge that if they had these parts available for the resorts they would have more sales.

Can’t miss, right?

What actually happened was the resorts thought the wholesaler should go to the expense of keeping the inventory in stock; and the wholesaler felt the same way about the resorts. Nobody wanted to front the money so nothing happened. And when things broke down it was always on us, the manufacturer’s rep, to get what was needed to the wholesaler who would then get it to the resort. This took time, of course (our warehouse was 100 miles away from them), and that aggravated both the wholesalers and the folks at the resorts.

And as this went on, I kept pointing at the parts binders I had made for them. “Isn’t this a better way?” I said. They kept waving me away. What did I know?

The older I get, the more I think about my Catskill days. All those resorts are gone now. So are most of the wholesalers. Nature and business take their course. And in the meantime, online suppliers seem to be reaping the rewards.

Care to dance?