Steady Growth Leads to Success
With eight facilities located across three states, ILLCO Inc., based in Aurora, Ill., has grown steadily since 1929 to become one of the Chicago Metro area’s largest distributors of commercial refrigeration, heating, air conditioning, PVF, plumbing, and hydronic supplies. The company prides itself on having large inventories and a knowledgeable staff in order to meet the needs of its commercial contracting customers.
While growth is important to ILLCO, Bill Bergamini, company president and COO, said the key is to do it in such a way that will enhance its core business. “We don’t want to sacrifice quality just for the sake of getting bigger. Some of the strongest distributors are the medium-sized regional wholesalers in which the top management and ownership are extremely involved in the business. If you have 50 locations, how do you know all your employees and your key customers? That’s the tough part - getting bigger and still offering the small- to medium-size company service and attention to detail.”
CATERING TO THE COREAttention to detail is important at ILLCO, which has meticulously built its business around being a total solutions supplier for commercial contractors. In order to fill that role, the company carefully examined its customers’ businesses and then figured out how to provide everything commercial contractors need in order to do their jobs. This includes stocking a wide array of commercial refrigeration and HVAC products, pipes/valves/fittings, and hydronics equipment.
In addition, ILLCO carries commercial water heaters, which are typically the purview of plumbing supply houses. “Even though it’s a plumbing product, it’s usually the mechanical contractor who installs it, so it really fits into what we do,” said Bergamini. “We try to supply everything for the commercial contractor’s core business.”
Being able to successfully meet all the needs of its commercial contractor customers means carrying a large amount of inventory, which is the cornerstone of ILLCO’s philosophy: committing to a line, stocking it, and having enough of it on-hand. “Everybody is concerned with turns, but you can’t forget what a wholesaler is supposed to do: a wholesaler is supposed to have stock,” said Bergamini. “Our mentality is to have a large amount of inventory in local areas. We don’t want manufacturers to have distribution centers all over the place so that we can pull from them. That’s our job - we’re supposed to have that inventory. We’re supposed to place our orders in enough time, and they’re supposed to manufacture the products and ship them to us. We believe that’s our place in the chain, and it’s the main role that we play.”
With the tough economy, carrying large inventories also makes sense because it earns customer loyalty, noted Bergamini. “If customers know the product isn’t backordered, or that they won’t have to wait around for days for products to be transferred to complete an order, they may shop around a little bit less. Contractors can come to us, and they know we’re going to have what they need.”
Another key to ILLCO’s success is having talented employees on staff that can provide distinctive and comprehensive customer service. Having knowledgeable people on staff that can interact intelligently with customers is one of the main ways in which wholesalers add value to the supply chain, said Bergamini. “When you look at what a wholesaler does, we don’t manufacture anything, so what do we do? It’s about the value that we add to the process, which is basically our people - how they can help the customer out. It’s the interaction and the relationship between our people and the customers.”
ILLCO staff is there to make life easier for commercial mechanical contractors, which is why the company encourages its customers to place orders in whatever way they like. “Sometimes we get orders by email, and sometimes we get orders written on scraps of cardboard boxes,” stated Bergamini.
“Whatever is convenient for the customer is how we want to receive it. We’ll take the order, and we’ll deal with it. We don’t want to dictate to customers how they need to place their orders with us.”
EDUCATING STAFF, CUSTOMERSBergamini believes strongly in educating his customers and his staff, which is why ILLCO provides numerous training opportunities for both. For customers, ILLCO partners with manufacturers to provide training classes during the fall and winter months. This training is almost always technical in nature and takes place after the normal work day. As an added bonus, ILLCO provides dinner for those attending the training, which usually focuses on specific products or topics (e.g., supermarket refrigeration).
Staff members receive technical training from vendors, as well as sales training from Heating, Airconditioning and Refrigeration Distributors International (HARDI), which Bergamini believes is one of the best resources for industry training. “Education is one of the four pillars that define HARDI’s focus - the others are benchmarking, advocacy, and networking. HARDI continues to take all these pillars to new levels every year.”
Bergamini has been involved in HARDI for many years, and this year he will also be taking his involvement to a new level, as he assumes the role of secretary/treasurer. “I’m really looking forward to it because the more involved we are in HARDI, the more we get out of it. I’ve heard this many times over the years, and I am experiencing it now to its fullest. Thanks to our involvement, we’re much more aware of what’s going on in the industry.”
Getting involved in HARDI is one of the smartest moves a distributor can make, noted Bergamini. “If you aren’t familiar with the association or have been away for awhile, I strongly suggest you take a look at what you are missing.”
SIDEBAR: CLIMBING THE CAREER LADDERBill Bergamini grew up in the HVACR industry, as his father, brother, uncles, and cousins were all mechanical contractors. After college, Bergamini worked for an HVACR controls manufacturer before coming to work at ILLCO in 1988. He didn’t know much about the distribution side of the industry, but thanks to owner, Jay Glass, he learned very quickly.
His future father-in-law made it clear that Bergamini would work at every position in the company from the warehouse to the counter before he could move up to the next position. “This was the most important element of my career path at the company. I was told that I needed to know every position if I was to ever have any of those positions reporting to me. Jay was the most incredible mentor I could have ever hoped to have. His work ethic and knowledge of wholesale distribution is second to none in the industry.”
With over 50 years in the industry, Glass is the current CEO at ILLCO, and Bergamini is looking forward to having him there and continuing to learn from him for many years to come.
Published: January 2012