From August through November, “The Wide Line” blog will feature a series of columns authored by Dan Strongin, a well-known name in the food industry.
The conversation with John and Jerry then turned to the topic of the personal side of their business and the advantages of working in a family-owned operation.
Jerry: Let’s discuss the idea of a family business.
John: …and the direction that we can go and other businesses can’t, because we are family owned; simply put, we have the luxury of a long-term perspective.
Jerry: You know I came from a large corporation before joining Nelson-Jameson. At the large corporation we had the initiative of the month instead of long-term thinking. You could not do long-term things. The direction of the organization was constantly changing. At Nelson-Jameson, with a long-term strategy, it is so much better, and so much more fun to operate in our environment.
John: An example I could give is our branching strategy. We never ever really tried to rush; we let it develop as it seemed to make sense. We first propounded the idea sometime in the late 80s, and now in 2012 we have all the locations we planned way back then. It’s a long term thing.
Dan: What exactly do you mean by a “branching strategy?”
John: That refers to the establishment of branches, or other locations around the country. A major part of our role is having inventory close to the customer.
What makes sense for us is to be within a day’s delivery by some parcel service, and have it in inventory. Why is this good business? When a customer calls and finds that we have it, and the three other things they may need, before long, they get the habit of calling us first.
Dan: In your branching strategy do you bring everything into a central warehouse or is each satellite warehouse independent?
John: It’s actually mixed bag. It evolved over time. One thing you have to understand about our evolving position in the marketplace is that our target market is all food processors; every one of our locations is unique and their needs are related to what foods are being produced there.
I believe in what I call distributive distribution, where the decision-making is fairly close to the customer. I can see a time when Nelson-Jameson will have branches that pretty much express the local environment in the food industry, and are really quite different. They will be carrying different products, but are linked together by a computer system with a certain logic that allows us to take advantage of the resources of other branches, so we can get product to people in emergencies, and find other economical ways to deliver on our promises.
We are still incredibly dairy-oriented. As time goes on we are superimposing little teams which organize themselves in such a way as to concentrate on other food industries. I always think in terms of product and product lines, so we are looking closely at each in terms of what products they use: what’s up and coming, in order to position ourselves a little ahead of the curve, so we can find leading-edge products or lines, and get accepted in the industry. You introduce yourself by these specially lines. And frankly I think food safety and laboratory products are still the best bet across the entire food industry. We have a lot of fertile ground to plow in just moving into the overall food industry for our future.
Dan: Besides long term thinking, in terms of a family business, what are the advantages for people of buying from you as opposed to buying from a big corporation?
John: We love our employees and they know that they are loved; when they are loved they don’t have to worry about things other than doing a great job for the customer.
Jerry: I think what John said is the answer! Another thing that I want to mention though is the Nelson’s involvement in the community and the industry. The Center for Dairy Research is looking to rebuild Babcock Hall in Madison and they just came to us asking for a significant donation, and the Nelsons again are going to be very proactive in supporting that, as they do all the industries they serve.
Note: In our final installment, we will look at the inherent danger in letting accountants have too much influence over your business decisions, pulling all the various strings from previous posts together.