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The Super Influentials

Electrical Wholesaling magazine salutes the electrical industry's best and brightest.

The most progressive companies in the electrical business are always looking to benchmark themselves against the true leaders-the electrical distributors, electrical manufacturers or independent manufacturers' reps in this or other distribution-based industries from whom they can learn, and apply to their own firms, the thinking and practices that make these companies so successful.

Ten years ago, Electrical Wholesaling magazine ran an article called "The Super Influentials," in which we profiled the industry leaders who the magazine's editors believed would set the pace in this business in the 1990s. These distributors, manufacturers, reps and educators excelled in many different areas. Some of the Influentials led the electrical industry in finding practical applications for what were then relatively new technologies such as Electronic Data Interchange (EDI), bar coding and computer communications. Several of the men and women selected were respected for their creative marketing strategies. Others developed one-of-a-kind training programs for the electrical industry, or quickly built their companies into industry powerhouses during the 1980s.

As the 1990s draw to a close, Electrical Wholesaling magazine once again has selected the standouts among us-the people who have proved that one person truly can make a difference, not only to their own companies, but to an entire industry. Their accomplishments bettered their own businesses, but what makes them truly influential is how their contributions affected the electrical wholesaling community as a whole.

Along with these industry leaders, this time around we have added the "super influential" companies and industry trends that reshaped the business during the past decade and, we believe, will have the most impact in the future. In the following pages, the editors of Electrical Wholesaling proudly profile the industry leaders, companies and trends who we feel will lead the electrical industry into the 21st century.

Always a Few Years Ahead of the Pack Jim Coghlin

Think back to the truly "big ideas" that took root in the electrical wholesaling industry over the past decade. Concepts like integrated supply, Total Quality Management, ISO 9000, bar coding and harnessing computers to streamline operations. Now name an electrical distributor who was in on the ground floor in each area. Chances are the name Jim Coghlin comes up in each area.

Part philosopher, visionary, adventurer, business strategist and technical guru, Jim Coghlin sees The Next Big Thing a few years earlier than most electrical distributors and applies what he learns to Coghlin Companies, Inc., Westborough, Mass., his family's business. His company headquarters showcases a state-of-the art, materials-handling system and a real-time computer network. Among his many accomplishments, the chief executive officer and chief quality officer of Coghlin Electric co-founded New England's Innovative Distribution Group (IDG), was an early pioneer in integrated supply, and won NAED's Distinguished Service Award in 1992.

Coghlin is a Renaissance man who is equally at home discussing the latest in distribution strategies and electronic commerce, his bungee-jumping adventure in New Zealand, his vintage automobile racing or the post-season woes of the Boston Red Sox. Although he lives his business life on the cutting edge, his philosophies for business and life are grounded in two basic philosophies. When he won EW's 1996 GEM Award for Electrical Distributors, he said his company philosophy was based on his observation that, "Winning is relatively simple if you surround yourself with people who have a passion for life, as that passion will reflect in your business successes." His personal philosophy, the "Words to Live By" offered upon receiving that award, reveals the compassionate side of one of the industry's most fascinating men: "People don't care how much you know until they know how much you care."

A Future as He Envisioned It Clyde Moore

Some people see Clyde Moore and immediately think of how the dozens of acquisitions that he has made over the past decade have turned Thomas & Betts Corp. into a formidable player in so many product areas. Yet the mark that he has made on the electrical industry reaches far beyond the acquisition game.

No one can question that in the 1990s, the CEO of Thomas & Betts Corp., Memphis, Tenn., has in some way shaped advances in major industry initiatives such as distributor programs, EDI, vendor-managed inventory (VMI), bar coding, the Industry Data Warehouse (IDW) and warehousing and logistics. Moore has invested millions to make T&B one of the industry's unquestioned leaders inthese areas, with the ultimate goal of transforming T&B into one of the easiest companies in the industry with which to do business. From the miles of aisles and conveyors in the company's monstrous automated warehouses in Byhalia, Miss., and Sparks, Nev., to the much-imitated Signature Service distributor program that's only a few mouse clicks away on T&B's Web site. Moore's vision is to make T&B the electrical distributors' preferred supplier in one of the electrical industry's broadest product offerings.

It's hard to believe that this visionary got his start in the electrical business making $1.62 an hour as a night-shift computer operator for the Modern Maid division of McGraw-Edison Co. But it's not hard to envision that he will continue redefining what's possible in the electrical wholesaling industry.

Speaking Out for Reps Loud & Clear Hank Bergson

For time eternal, independent manufacturers' reps have endured the scorn and disrespect of people who don't understand their role, or the value they add to the industry's marketing equation. Twenty-nine years ago, Dick Noel and Tom Preston made their dream for a national organization that could help independent manufacturers' reps combat these challenges a reality by founding the National Electrical Manufacturers Representatives Association (NEMRA).

When Hank Bergson, today NEMRA's president, took the helm at NEMRA in 1986, he said he felt like a teenager who had just been handed the keys to the family car for the first time. Bergson stepped on the gas and never looked back. He has become the voice of the independent manufacturers' rep in the electrical business. When manufacturers new to the electrical market analyze their potential paths to the market, Bergson is there to champion the advantages of a rep-based sales force. When the second generation of a rep agency needs some advice on running the family business, they seek out Bergson for his wise counsel. In the future, reps will continue to wrestle with their role in the face of challenges from manufacturer consolidation, electronic commerce, new product technology and the changing of the guard in so many of NEMRA's family-owned businesses. But you can bet that it will be Bergson at the point, speaking out forcefully and eloquently for the concerns of the common rep.

A Bold and Radical Vision for the Future of the Distribution Industry Bruce Merrifield

Every industry needs some intelligent eyes on the frontier to spot new ideas that could blow away everyone's comfy concepts of business as usual. During the 1990s, Bruce Merrifield has dispatched countless bulletins from his post on the electronic frontier alerting distributors in his distinctive rapid-fire stream of consciousness style about the new ideas, competitors and ways of doing business that are changing the definitions of distribution as we know it. He has seen enough to know that distributors who don't add value to the basic packages of me-too services will have the most trouble finding justification for their existence. In his many presentations at industry meetings each year, Merrifield drives home the point that more supply houses will die off from the "thousands of little nicks" inflicted by new alternate sources of supply and new theories on getting product to market than from frontal assaults from any one single competitor.

Merrifield's Web site, found at is a treasure trove of new, old and otherwise fascinating ideas on the distribution business. The dozens of articles at this site on basic financial, sales, marketing and management skills, as well as his selection on electronic commerce and the Web make up one of the distribution industry's best online resources. Many of his ideas are based on his experiences running a distributorship in the lock and security systems business.

In recent years, Merrfield's vision of how electronic commerce will transform the industry has shaken up a lot of distributors. He believes distributors have to get serious about electronic commerce, and his signature line, "If distributors don't get serious about electronic commerce they will be toast," gets a lot of airtime in many different distribution businesses.

You may not agree with all of Merrifield's ideas, but it's somehow comforting to know that someone out there is thinking all of this stuff through.

The Big, Bold Behemoth W.W. Grainger

Grainger is not exactly the new kid on the block in the electrical market; the company got its start selling motors 72 years ago through its famous red catalog. But in the 1990s, the company took on many premier electrical product lines, marketed itself much more heavily to electrical contractors and increased its share of the maintenance and repair operations (MRO) business of industrial and commercial accounts.

It's not so much that Grainger has taken dead aim at the electrical market that makes the company one of the most influential players on the electrical stage, it's how the company does business that makes it a force. In the early 1990s, while many electrical distributors were arguing whether or not EDI was a good idea, Grainger was transmitting orders via satellite from its branches to its main headquarters in the Chicago suburbs. A few years later, the company powered up a Web site that has won numerous awards for its accurate, easy-to-use search engines, electronic catalog and online storefront.

On top of all these advances on the electronic commerce front, the company still publishes its famous catalog that sits on the bookshelves in so many of your customers' offices. This catalog is now so thick, it's almost beyond binding, a tribute to Grainger's ever-expanding product offering. The company also has scored big in integrated supply with some major national contracts.

Grainger in many ways epitomizes the hybrid distributors and alternate channels that emerged over the past decade to challenge full-line electrical distributors. While in and of itself the company has not knocked any distributors out of business, the company has by any measure chipped away a ton of business from electrical distributors and will be a force in the market for years to come.

The Scare, the Reality and the Lessons Learned Home Depot

During the past decade, electrical distributors saw Grainger edging into the market on the MRO front in the industrial and commercial markets, and in its new interest electrical contractor business. From the other end of the marketing spectrum came a big orange blur with blinding speed out of Atlanta, Ga.: The Home Depot, Inc. The $30.2 billion big-box bully, which has grown to 761 locations worldwide, used in-your-face advertising, warehouse retail strategies, and shopping baskets chockful of solid electrical lines to strike fear in the heart of many an electrical distributor over the past few years.

The company became a major factor in the electrical market and probably sells in the neighborhood of $1 billion-plus in electrical products. The company now does more in electrical product sales than any electrical distributor, save the largest national and regional chains. This figure will grow, now that the company has introduced a hardware store format for Main Street U.S.A. to complement its big boxes.

Yet, resilient electrical distributors learned that they can offer much more than Home Depot, if they play the game properly and offer a broad, deep inventory, reliable delivery, 24-hour service and knowledgeable sales help for assistance with technical questions. That's because Home Depot, for all its high-profile positioning as a source of supply for professional contractors, still focuses primarily on the fastest-moving items for the residential market, some small commercial jobs and a touch of MRO business. Electrical distributors were relieved to find that their customers still needed more than that. Savvy companies learned from this master and hit the market with aggressive advertising, sharpened up their merchandising skills, cleaned up their counter areas and took Home Depot head on.

The Benchmark of Success for All Distributors NAW/Arthur Andersen's DREF Research Studies

If you agree with the premise that the business fundamentals are the same whether you are schlepping boxes of wire nuts, spark plugs or dental floss, you have already figured out that electrical distributors can learn a lot from distributors from other trades. That's the foundation of the invaluable package of services that the National Association of Wholesaler-Distributors (NAW), Washington, D.C., offers the distribution industry. In some industry observers' eyes, the jewels of these services are the research studies that NAW co-publishes with the Arthur Andersen consulting firm. The Facing the Forces of Change series, as well as some related studies, give distributors of all stripes a terrific read on the most important current and coming trends in the distribution business, as well as a wealth of benchmark data that companies can use to compare their basic financials against those of like-sized distributors from other industries.

Along with invaluable data, NAW offers distributors some truly monumental food for thought: Break out of the "If it 'ain't invented here, it won't work" philosophy that's so prevalent, and stretch your thinking to adopt ideas from other distribution-based businesses.

The Group by Which All Others are Measured Affiliated Distributors

Sure the annual rebates are great. But the cooperative purchasing power of the members of Affiliated Distributors, the largest buying/marketing group in electrical land, is only part of the story. A-D helps-some would say forces-electrical distributors to use marketing to sell electrical products.

That sounds like pretty basic stuff. Distribution 101. But from his years of working with electrical distributors as the head of Progress Lighting, David Weisberg, A-D's founder, knew that when it came to marketing, most independent electrical distributors were in desperate need of assistance. With this in mind and a buying consortium model already successfully established in the hardware, auto supply and other distribution-based industries, he built a network of many of the best and brightest independent distributors by offering not only volume-based rebates to keep members' purchasing on par with the nationals, but mandatory participation in marketing programs to help grow their businesses.

With the help of David's son, Bill, who now leads the association, the 1990s were extraordinarily busy years for A-D, which has grown to 280 electrical distributors, industrial supply houses and pipe, valves and fittings distributors with a combined sales volume of over $13 billion. Along with its core focus on marketing and cooperative purchasing, Affiliated Distributors now offers exposure to national account and integrated supply contracts; a sophisticated extranet that members can use to communicate with vendors, A-D personnel and other members; and advice on getting into newer markets like datacom and energy-efficient electrical products through formal presentations from fellow distributors, as well as more informal networking opportunities.

Other buying/marketing groups are now on the scene that provide many of the same services to their members. But no one can argue that A-D was there first and is the model that others attempt to emulate.

A Few Steps Ahead of the Pace Vic Jury

Vic Jury is not afraid to admit that electrical distributors don't have all the answers, and he is one of the best in the business at spotting better business practices of distributors from other industries and applying them to his own business.

At an EW Roundtable held a several years ago, Jury said, "The last thing we need to do is benchmark this industry. We need to see the guys who do it right. Hard-goods distributors traditionally lag in terms of trends, while soft-goods distributors and the drug and grocery industries tend to be on the leading edge."

Whether it's keeping an eye on W.W. Grainger or learning from a smaller niche player in another distribution industry, Jury finds other distributors' businesses to be fertile ground for new ideas.

One thing Jury didn't have to learn from another industry is the importance of training, and Albuquerque, N.M.-based Summit Electric Supply Co., Inc., is known throughout the electrical wholesaling industry for its training programs for new employees. The company also has one of the finest Web sites in the business, and over the past few years has become a power to be reckoned with not only in its native Albuquerque market, but in Dallas, El Paso, Fort Worth and San Antonio, Texas; Phoenix, Ariz., and Montclair, Calif., as well.

Jury, who won EW's GEM Rising Star Award in 1992, is also respected as an articulate spokesperson for the electrical distributor in any debate on the state of distributor/manufacturer relations. With lessons learned from his father, Vic Jury, Sr., and industry veteran Dave Meredith, who recently retired from the company, Jury will continue to be a distributor to watch in the years to come.

A Killer Strategist Who Walks the Talk Terry Burkholder

Remember all the talk from the podiums at industry meetings and in the editorial columns of this and other industry publications after the Facing the Forces of Change study was published in 1987 by NAW and Arthur Andersen about the need for distributors to find new market niches? Terry Burkholder, president, Dauphin Associates, Inc., Harrisburg, Pa., did more than just listen to these speeches or read the articles on the subject. An acknowledged master of the market niche, Burkholder has separate companies operating in voice/data, specialty lamps and energy-efficient systems. He is at least a decade ahead of the distributors who are now preparing themselves to take the plunge into voice/data, having started up his Mid-Atlantic Cable & Connectors business in the late 1980s. At about the same time he set up his lamp specialty company, Mid-Atlantic Lighting Co. The two businesses were the subject of a 1990 EW cover story.

Anyone who has spent any time with Burkholder knows how he loves to discuss the big picture, and of his penchant for developing strategic marketing plans. But unlike others who write up strategic company visions that never make it out of their credenzas, Burkholder has a knack for picking a target market, developing a plan to get a piece of that market and then finding the right people to make it all happen. In his success with new business start-ups are lessons that all distributors should take the time to study and learn.

A Rep With a Vision for the Future Ron Haedt

Ron Haedt surprises a lot of people. The principal of Electrorep, Inc., Sausalito, Calif., and chairman-elect of the National Electrical Manufacturers Representatives Association (NEMRA) enjoys a good a laugh and his easy-going demeanor covers up his strong opinions on the state of rep-manufacturer relations and other challenges confronting the rep of today. At this year's NEMRA meeting, the winner of EW's 1999 GEM Award for Independent Manufacturers' Representatives spoke out strongly against outdated one-size-fits-all compensation programs, and asked manufacturers to reexamine rep compensation packages and tailor them to the new market realities of the 1990s.

Haedt is widely respected for the team strategic planning sessions that he insists on with vendors and how he has used technology to transform Electrorep into an efficient business partner for the distributors and manufacturers the company partners with.

The Question Everyone's Asking Dare You Data?

With the explosion in applications for voice/data equipment, one would think this bandwagon would be groaning under the weight of all of the new converts who want to take the voice/data market for a long ride to future profits. As the 1990s come to a close, it's true that many distributors, manufacturers and reps are closely scrutinizing potential sales opportunities in the voice/data market, which depending on whom you talk to, will represent $4 billion to $7 billion each year in sales through electrical distributors. Yet relatively few new distributors are committing the resources necessary to become serious players in this market. Graybar Electric Co., St. Louis, Mo., and Anixter, Inc., Skokie, Ill., still dominate this market, although a handful of strong independent regional distributors are major players in some areas. This market will continue to surge, because of the rewiring of offices, schools, hospitals, universities, government facilities, factories, homes and so many other commercial and non-residential buildings with new computer, security, video, smoke-alarm, signaling and other types of low-voltage cable and related products. Yet only time will tell if this market, which is about 10% the size of the market for traditional electrical products, will ever live up to its hype, and whether many more than a few well-entrenched specialists who keep up with the necessary commitments to training personnel will become significant players in voice/data.

A More Wired World 'Goin Mobile

Remember when fax machines and personal computers came onto the scene in the 1980s? Very radical at the time. When it beeped for the first time to signal an incoming fax, most of us rushed over and waited in awe for that first scroll of fax paper to roll out of the machine. And when the company's first personal computers came out of the cartons, for many of us it was like Christmas morning.

During the 1990s, mobility has become the watchword. Cellular phones, E-mail, pagers and laptop computers changed the business world even more than fax machines did. They let us bring the office on the road, take it home and in the air, and, for better orfor worse, gave us all the opportunity for no-excuses, 24 x 7 access, all the time, anywhere. What will change the business world in the next decade to the degree that fax machines, personal computers, cellular phones, laptops and other trappings of the totally mobile office changed how we did business over the last 20 years? Some people are placing their bets on the Internet and believe it will shake things up just as much as these devices did, though it hasn't happened as fast as the more Web-savvy among us would have expected.

A Bug that Bites Y2K

The editors of Electrical Wholesaling selected the Y2K bug for this article because of the countless hours and untold millions of dollars that companies in this industry have had to spend to make their companies Y2K-compliant. While some industry observers believe dealing with this problem meant companies had to divert their attention and resources to a totally non-constructive and unnecessary problem, when they could have spent their resources on much more constructive areas, others believe Y2K inspired many distributors to junk their antiquated legacy computer systems and to finally invest in current technology, bringing them many operational efficiencies.

The price tab for Y2K in the electrical industry is near-impossible to calculate. It includes the expense of the programming time and the additional costs that companies incurred to keep or hire the computer talent that has become in such short supply, in large part because of the current demand for programmers willing to change thousands of lines of code to overcome Y2K. Think of all the other things companies could have been doing with these resources.

Making New Rules in the Automation Game Rockwell Automation/Allen-Bradley

The automation market shift over the past 10 years, from a hardware-based environment controlled by proprietary software to a software-based open-architecture world where some types of hardware are seen as little more than commodities, has had a dramatic impact on all players in the automation market. To adapt to this fast-changing market, Rockwell Automation/Allen-Bradley blended software into its product and service mix and now requires its distributors to have specialists in Rockwell Automation software on staff, in addition to the on-staff expertise on the hardware side.

The new requirement to hire on software talent and the related training that they will need to stay current with the market has reportedly been a factor in the decision of some smaller Allen-Bradley distributors to sell out to larger companies like McNaughton-McKay Electric Co., Madison Heights, Mich. Because of A-B's size and market dominance in so many types of automation products, this move was big news in the automation market. It also may have had an impact on the distributor policy front, because some companies seem to key off of A-B's respected selective-distribution policy. The company also has pushed distributors into unfamiliar territory that promises to pay big technological dividends over the coming decade.

Inevitable Turmoil Down the Road Utility Deregulation

As utility markets across the U.S. open up for competition over the next few years, electrical distributors can expect to see plenty of changes in their relationships with their local electrical utilities. Utilities will be looking for new revenue streams or ways to cut costs, because they stand to make less on the electricity they sell to businesses and consumers. For instance, some utilities see installation of energy-efficient electrical systems for commercial and industrial buildings as a profitable venture and have already set up their own installation crews or have contracted with electrical contractors to provide this service with them. Others are reexamining how they warehouse supplies and are considering outsourcing this function to distributors.

While the early impact of deregulation has not been as dramatic nor as far-reaching as expected, it's a no-brainer that this trend will eventually affect electrical distributors, independent reps and manufacturers in a big way.

Quiet Growth on a Huge Scale Graybar

It's part of Graybar's corporate culture to not brag on itself or reveal any more than absolutely necessary about its strategic initiatives or plans for the future, as you can see in this month's feature "Gearing Up for Growth," (page 47). However, its accomplishments during the 1990s in so many areas of the business are readily apparent. Competitors scrambled to respond to the growth of its datacom business; the renovation of dozens of branches with retail-style floor plans and related merchandising strategies; and its national accounts/integrated supply partnerships with so many Fortune 500 companies. The company also earned kudos for its contributions to the industry through the tough stand it took on standards for electronic commerce in bar coding, EDI and vendor-managed inventory. While these accomplishments are impressive, Carl Hall, company president, and his management team will quickly and confidently tell you that they are just the foundation for what Graybar has planned for the future.

Fasten Your Seatbelts Online purchasing

The Internet already offers 24-hour access to more data (both useful and useless) than we ever dreamed possible. The mega-million-dollar question is how to harness this data to produce additional profits. Access to electronic catalogs and basic information on product specials, special events and company policies is certainly useful, but online access to this information in and of itself will not revolutionize the electrical business.

Online purchasing can. More distributors are building online storefronts to test the waters. Look for it to become a popular option that will supplement, but not totally replace, conventional purchasing options.

Leveraging Economies of Scale Roy Haley

The rebirth of tired old Westinghouse Electrical Supply Co. as a vibrant national powerhouse is one of the most dramatic comeback stories of the past decade, and its impact is assured well into the next. In an era of mind-boggling activity in mergers and acquisitions among electrical distributors, Pittsburgh, Pa.-based WESCO Distribution has captured the lion's share of the attention, landing marquee names such as EESCO, Avon and Reily in full-line distribution and Bruckner in integrated supply. At the same time, WESCO has amassed a dominant position in the utility-products distribution market and considerable strength in integrated supply and national accounts. Directing WESCO's metamorphosis is Roy Haley, chairman, president and CEO, who, in a period of about two years followinghis selection to lead WESCO in 1994, went from being just another Arthur Andersen consultant to one of the most talked-about CEOs in the electrical industry.

Although he has been criticized in some quarters as a financial operator who would leave the industry as quickly as he came once WESCO's turnaround was complete, Haley's insights on evolving customer needs and the changes distributors and their vendors must make to satisfy those needs continue to gain influence. Last year he led a management buyout to refinance the company and as this issue goes to press he is preparing WESCO for its initial public offering. All indications point to even greater consolidation activity and aggressive growth in the near future for WESCO, suggesting that WESCO's role in the next stage of the electrical industry's evolution has yet to be defined, and its influence in this market has yet to peak, which assures that Haley's stamp on the company will influence the industry well into the future.

The Power of a Good IDEA Industry Data Exchange Association

For more than a decade, this industry has tried to find the right way to use electronic data handling capabilities to suck redundant data entry, errors and other pointless costs out of the wholesale channel. Countless valiant efforts were derailed for various reasons--more often political than technical--and in the meantime the rise of TCP/IP Internet protocols spawned countless new tools and techniques for exchanging data. Now, with the creation of a new association with equal representation from both manufacturer and distributor interests, the Industry Data Exchange Association (IDEA) seems to have hit on the answer. If IDEA succeeds in its quest to establish an industrywide data warehouse (IDW) and extranet, the results could produce the most profound positive change the industry has seen in a long, long time.

With two of the industry's technological visionaries leading the charge--Dave Crum, president of Crum Electric Supply, Casper, Wyo., as chairman, and Clyde Moore, CEO of Thomas & Betts Corp. (T&B), Memphis, Tenn., as vice chairman--the association in very rapid fashion has created an information infrastructure to change the industry.

Dozens of individuals have contributed substantially to IDEA's efforts, but it has been the IDEA technical committee that set the pace and the standard for commitment to the industry's future. Led by co-chairs John Haluska, chief information officer of T&B (who has been called the "spiritual center of the IDW" by his peers) and Jim Ford, director of electronic commerce for Graybar Electric Co., the technical group has met every two weeks for more than two years now developing, prototyping and troubleshooting the IDW and developing the specs for the IDEANet extranet. Electrical Wholesaling's editors applaud all the participants in IDEA who have given so much of their time and effort to make the IDW and IDEANet a reality.

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