RJ Schinner Featured in WDI Magazine!
RJ Schinner was recently featured in the Summer 2014 edition of Wholesale & Distribution International (WDI) Magazine! Read the full article, written by Jennifer Hopfinger, on their website here: http://www.wdimagazine.com/index.php/featured-content/244-r-j-schinner-co or read the full article below.
Paper products redistributor RJ Schinner is going national while staying true to it’s regional roots.
Consolidation is part of the natural evolution of any industry. Smaller companies must grow or they’re gobbled up by bigger ones – until eventually the strongest come to dominate. Efficiencies are created, new geographies are tapped, better technologies emerge. But benefits are lost as well: high-touch service, personal relationships between customers and suppliers, intimate knowledge of particular needs.
Redistributor RJ Schinner – the largest independent redistributor focusing on disposables in the United States – is in that sweet spot between big and small, where it’s enjoying the best attributes of both – and it’s determined to hold on to them as it matures.
“We’re proud that we’ve been able to grow and still maintain our customer-centric focus,” President Ken Schinner says, “and to continue to do so is our challenge going forward.”
RJ Schinner is a 63-year-old company, owned and run by the five sons of the founder. One of them, Jim Schinner, is the chairman; Ken Schinner is Jim’s son. The company got started in 1951 distributing paper bags to grocery stores in downtown Milwaukee. It eventually expanded into other products including foodservice paper and plastic packaging and disposables and janitorial sanitation supplies.
About 20 years ago, the company based in Menomonee Falls, Wis., began opening distribution facilities in new areas – first in Minneapolis – and in recent years, has dramatically stepped up its expansion efforts by branching out beyond its home market in the upper Midwest and into the south-central and southeastern United States. It now has a total of nine facilities – located in Wisconsin, Minnesota, Ohio, Michigan, Missouri, Tennessee, Texas and Georgia – and redistributes to customers in 26 states.
“Quite frankly, we didn’t have a choice,” Jim Schinner says. “Most of the smaller, regional independents in our business are gone. Our competitors are national in scope, and therefore, we needed to attain critical mass to be viable and hopefully thrive.”
For the time being, though, most of RJ Schinner’s customers are still regional, and they appreciate working with suppliers that are smaller like themselves and geographically close to them. The company’s expansion has brought it in proximity to more of those customers. “We’re filling the void left by regional independents,” says Jeff Heeren, executive vice president of marketing.
Many of the national competitors use supercenters – large distribution facilities that might cover a 10-state area. RJ Schinner’s regional distribution centers make it possible to deliver products faster and cheaper. “Most of our business is shipped in our own trucks, and most of our drivers are home every night,” Ken Schinner says.
RJ Schinner plans to continue growing with this regional approach. “Our objective is to go national and we’re going to continue to expand until we are,” Heeren says. “We are getting more national customers and we need to be able to reach all of them.”
Size has other advantages, too. “When we were smaller, we weren’t really a factor with vendors, but vendor support has come on strong as we’ve grown,” Schinner says. “In order to attract the best arrangements and pricing from manufacturers, we had to become relevant and have the leverage of purchasing power.” With greater purchasing power, the company has been able to launch its own private-label brands in foodservice and janitorial products.
The challenging economic climate in recent years has been a boon to RJ Schinner. “By virtue of what we do – redistribution – we bring efficiencies to the supply chain,” Schinner says. “Because of us, our customers have higher return on investment and increased cash flow from carrying less inventory. And the manufacturers are shipping full trucks to our locations and turning those trucks faster.”
The tough job market has also helped the company grow. “We’ve been able to hire very high-quality people. Everyone sees us growing in the industry – everyone wants to be part of a successful team,” he says. “Our issue has been how fast can we put people where we need them.”
The company’s workforce is key to maintaining the kind of service associated with a smaller business, according to Schinner. “We don’t have a rigid organizational chart, and we empower our people with the authority to take action. No matter what your job, we all ultimately work for customer service.”
Sales are expected to grow to $160 million this year, up 15 percent from the year before – an annual growth rate that has been consistent over the past 10 years. “That sales growth trajectory is one we plan to stay on,” he says.
RJ Schinner is in a business that’s all about efficiency, generating it for others as well as within the company. “In this industry, profit margins are never going to be great,” he says. “You have to operate lean, doubly so for a company experiencing this kind of growth.”
-Written by Jennifer Hopfinger, Copyright 2014 Wholesale and Distribution International
© Copyright 2014 Amy Ullsperger, All rights Reserved. Written For: DSR Sales Support Blog