Valve World Americas had the pleasure of speaking with George Booth, Chairman of Gebflow Control Co. (GEBCO) to learn about the evolution of the valve industry’s distribution channels.
By Bob Donnelly, Contributor
Q: What experience do you have in the Industrial Sector?
A: I have been involved in the valve business for over forty years now. I started out in operations and over the years participated in the growth of our business. I had the privilege of becoming part of the management team before moving into the role of Chairman, where I oversaw the business as it became one of the major valve houses in the Midwest. My father signed on as a distributor of Worcester Controls in 1970, and we are now the oldest Worcester Distributor in the country. Our mantra throughout the years has remained the same; all the valves and valve automation components we provide are ‘engineered products.’
If I had to pick one major strategic event that propelled the company’s growth and allowed it to become a major player in instrumentation and valves, it would be the decision to become a part of the I-Power consortium in the mid-nineties. I-Power put us in a position to offer storeroom management and related services. This allowed us to provide value and instrumentation standards to our customers which established us as the ‘standard’ for projects and MRO business.
Q: How has the distribution process evolved over the course of your experience supplying valves?
A: As we grew and expanded our offerings, we also changed the way we provided customer service by pairing our outside salesmen with supporting inside salesmen and hiring engineers for both positions with similar incentive packages. This has been a common transition over the last few years for many companies.
For example, roughly eight years ago, we acquired the Endress & Hauser Representative in Chicago, and have grown that business with an alliance with Rockwell Automation. The paring of their PCX system to operate our Process Training Unit allows us to conduct in-house valve, instrumentation, and trouble-shooting training. This type of relationship can contribute to building brand equity and a wider customer base.
The acquisition of smaller integration companies is another evolution I have witnessed. This type of acquisition was beneficial to our company as it allowed us to provide our own field service. Our latest acquisition was the Erdman Corporation, a major pipe, valve, and fitting distributor which expanded our footprint in the Indiana, Kentucky, Ohio, and Illinois market areas, along with new valve lines.
Q: How important is staff retention to the overall success and evolution to valve business?
A: Picking the right individuals can lead to the success of a company. My father’s philosophy has always been to surround yourself with good people; take good care of them, and they will take good care of you. I have carried on the same philosophy.
As we have increased our sales, people, and market area, we have given our managers the authority to make decisions and, sometimes, mistakes. By coaching them to do the right things, the company can learn from its mistakes and continue to evolve. Thirty-five years ago, incentive programs were implemented at GEBCO, and this has been a growing trend since.
For example, our sales team has incentive plans based on profit with no cap. This has allowed us to maintain our sales force. We also have a profit-sharing plan for our management team. It remains a challenge in today’s market to continue to find the right people.
We also have established a relationship with several engineering universities to recruit sales engineers. Additionally, we have started an internship program with local colleges to have students work for us during the summer and to learn about our business with hopes of hiring them when they graduate. These are all steps we have taken to ensure we are continually able to meet the needs of the market.
Q: How much does the automation of your operation play a role in the growth of a company?
A: Over the last 40 years, we have been through 3 ERP systems to continue to increase efficiencies and profitability. Some of what our system can do:
- Allow purchasing from our website.
- E-mail marketing materials.
- Automatic quote follow-up.
- Integrated links to our suppliers to allow them to quote and convert quotes to orders.
- Improved order entry per customer service representative.
Q: How do you see the consolidations in the industry impacting the future of industrial valve distributors?
A: As a second-generation family-owned business, we have had to plan for our survival in light of all of the continuing changes in our industry. We continue to acquire related valve businesses to expand our footprint like the Erdman Corporation out of Louisville, KY. Erdman has been in the PVF business for 93 years and has a reputation for valve automation.
These acquisitions allow companies to expand their market area and adds other valve lines to their portfolio. It also adds another layer of talented people to our management team.
Q: How much of an impact does the perpetual introduction of foreign valving products into the U.S. market have on your ability to maintain your competitive advantage?
A: While foreign competitors offering lower prices have created some issues, we have maintained that we sell proven engineered products and work to get those products specified. We also have relationships with several foreign manufacturers and we private label them as GEBCO products.
Q: In conclusion, how do you see the continuing evolution of technology/AI changing the valve distribution network in the U.S.?
A: We have developed a strategic approach, as the company realized that our customers are looking for us to make it ‘easy’ for them to do business with us. Partnering with engineering firms and end users is part of our strategy and has helped us win several new large projects. By working with engineering firms to create part numbers, procure products, receive products, and do recite verification, a company can relieve the end user of these tasks.
By implementing the new AI technologies, companies are able to optimize the ordering and procurement processes, which will ultimately allow them to stay relevant in the ever-changing market place.