Photo: iStockphoto.com/vernonwiley

Buying groups have been around since commerce started — individual companies joined together to maximize their purchasing power of buying products at a higher volume and lower price. 

So much has changed since their inception; today’s buying groups are known for their ability to go beyond purchasing power and extend into marketing efforts and tools for members to holistically integrate offerings from e-commerce, educational opportunities, and networking to maximize the potential of a business.  Membership is often accompanied by member engagement that strengthens the group, fostering growth and opportunities. 

There are many buying groups — both large and small, in so many different industries — and the PHCP-PVF channel is no different.  Each group has their own nuances, vision, and offerings — so we bring to you what is taking place at AD, IMARK and The Commonwealth Group.  

AD
(Tagline) Together We Win
www.adhq.com

AD is a member-owned and -governed group, passionate about bringing growth-oriented independent distributors and best-in-class suppliers together. AD is composed of 898 independent members, 918 suppliers and 89 service provider partners in 13 divisions in the United States, Mexico, and Canada. The divisions cover industries including electrical, industrial, safety, bearings and power transmission, plumbing, PVF, HVAC, decorative brands and building materials. 

The group’s mission is to help its members, supplier partners and associates develop, grow and prosper. As stated by Bill Weisberg, Chairman and CEO, “We help independent distributors outperform national and international chains. We help manufacturers build and protect their brands while diversifying their channel strategy. And, we help our associates reach their growth potential and have a great place to work.” 

He added that when he joined the group in 1983, AD distributed $1.9 million in rebates to members. Today, it has reached $1 billion in net distributions to its independent members. “We’re able to achieve this incredible milestone because our team is exceptional at the buying group basics — things such as rebates, reporting and meetings are all done efficiently and professionally by a dedicated group of associates who are laser-focused on our members’ success,” Weisberg says. 

Ruth Mitchell: The definition of a buying group has extended beyond the focus of combined purchasing power. Groups are incorporating tools to help members grow and expand their businesses — such as e-commerce platforms, marketing tools, payroll services and peer networking support.  What are the key member benefits offered by your group, and how do the offerings support growth within a member company? 

Bill Weisberg:  Our strategy is to be world class at the buying group basics and use scale to cost-effectively expand our offerings in areas of strategic value to independents.  

We do rebates, reporting and meetings efficiently and professionally. And we have an incredible ecosystem of value-added growth programs and services to give our members a competitive edge in the market in areas of e-commerce, finance, IT, marketing, HR and procurement services. We also provide a wide array of cross-industry and inter-industry networking and learning functions such as women in industry, emerging leaders, and e-commerce. 

Jeffrey S. Beall, president, PHCP Business Unit: AD’s e-commerce program proved extremely pivotal for members these past two years. This program and the team that fuels it helps companies build their e-commerce platforms to sell online where their customers are. By leveraging this innovative program, AD members — many of whom are in PHCP — not only continued to do business throughout the COVID-19 pandemic, but also evolved to thrive in the most difficult conditions, which is pretty remarkable. 

At the core of all our programs is our people. It’s not enough to offer a program. Those efforts must be backed by experts, dedicated to driving programs for our members’ and suppliers’ benefit, and constantly adjusting to fit their changing needs. 

RM: Navigating through a pandemic wasn’t easy — and wholesale distributors leaned into their buying groups for support. What existing avenues of assistance did members lean into, and what new tools/offerings were developed?  Are the new items now permanent offerings? 

JSB: Right from the start, the AD team got together with our member-owner-led boards to brainstorm how we could help our community navigate the profound effects of the pandemic. When lives were literally turned upside-down overnight, we knew the human element, the people in our community, were the top priority.  In close collaboration with our members, we focused on safety, education, and awareness. 

At AD, we innovated new ways of doing business and different programs to add value. We developed weekly, and then monthly, frontline business intelligence reports that members could use to benchmark themselves regionally. We established a community message board and a weekly “news you can use” newsletter so our members could get access to relevant real-time information, share insights they’ve found helpful, and support each other.  

We partnered with our service provider partners to hold webinars on key topics such as the federal Paycheck Protection Program and cybersecurity. Working with all our divisional resources, we conducted group purchases on gloves, personal protective equipment (PPE) and other safety equipment. 

We even found new ways of communicating with our community, internally and externally. We stayed connected with our divisional boards more frequently to facilitate quick decision-making, and we developed an internal program we call Heroes & Happenings, which are interview-style updates that Bill hosts, designed to help associates stay connected and informed in this new environment.  

Many of these initiatives served an immediate purpose; once our members became more adjusted to the new normal, they weren’t as heavily needed. Others have become permanent fixtures in our business.  

Strong partnerships between members and suppliers were crucial when navigating the pandemic, and the AD team was on the phone every day finding new ways for our members and suppliers to work together during this time. Ultimately, our members demonstrated the ability to drive growth with our suppliers even in the toughest of times, and that resilient and productive partnership is here to stay.  

RM: How did the group strengthen relationships and partnerships between members and suppliers over the last 20 months? How does this bond help members in their daily book of business?

JSB: The powerful relationship between AD, our members and supplier partners deepened in 2020 and drove incredible collaboration and innovation focused on uniting us and using our scale to lessen the effects of the pandemic.  

While workplace and travel restrictions limited our ability to host in-person meetings, the AD community didn’t skip a beat in shifting focus to continue our partnership in a virtual setting. By shifting to virtual, AD was able to host 11 spring and fall meetings, 45 member networking meetings, and thousands of virtual one-on-one booth sessions, enabling collaboration between members and suppliers.  

AD members also transitioned market planning efforts to include virtual field marketing summits, collaborating with AD suppliers for mutual growth. These efforts resulted in an increase in supplier conversions, where our members transitioned purchases from non-AD suppliers to AD suppliers. This was a time of deeper engagement and commitment. Our suppliers were there to support our members when they were needed the most.

In the PHCP divisions, we developed many new relationships, including merging with the members of Delta Distributors, who we were grateful to welcome at the beginning of 2021.  

RM: Many would say that it’s not a buying group, but a community. Can you share with us how members supported one another over the past 20 months? 

BW: We agree, thank you! Everything we did was focused on maximizing the strength of the group, facilitating continued growth of our relationships, and supporting one another.  At a more granular level, we coordinated several cross-divisional collective “power buys” of PPE when members and their customers needed that material most. We were able to secure a supply of KN95 masks, hand sanitizer and three-ply disposable face coverings to quickly distribute these critically needed items to members.  

This program had more than 100 AD members from multiple divisions participating in purchasing more than 700,000 masks, resulting in deep discounts based on the combined group buy. The effort enabled essential member companies to continue to serve their customers.  

Peer-to-peer networking and best-practice sharing are some of the most valued benefits of AD membership.  The truth is, if you want to get better at any game, you need to play it with the best players. This is true in life and in business. The Community Message Board we implemented at the onset of the pandemic enabled members to post resources, ask each other questions, and share timely best practices on how to navigate the common challenges members were facing. We were all learning on the fly, and it was a useful consolidator of the best information that was available at the time.  

I know I found consolation in making phone calls to associates, members, and suppliers to check in.  Communication was key, and we needed a lot of it. It was comforting to stay in touch.  

RM: The way business is conducted has drastically changed since the pandemic — supply shortages, labor shortages, transportation and logistics issues have made for the perfect storm.  What resources are available to members to help their companies navigate the challenges?  

BW: We’re fortunate to have a lot of expertise among our associates and service providers. This stable of experts were at our community’s disposal, and continues to be. And partnering with our safety suppliers to organize the PPE power buy was another benefit that helped us all navigate.    

RM: In what areas do you see growth potential for your members?

BW: This year, we've had 78 members and 42 great suppliers join us. Reaching a record amount of net distributions to members brings with it opportunities for growth and investment by our members. It also translates to our ability to offer more innovative growth programs for our community, which helps these companies grow and prosper. Welcoming new member and supplier companies into AD not only brings financial growth with more volume, but we also grow mindshare with new ideas, new networking opportunities and new ways to keep raising the bar.  

RM: What is a strategic goal or new initiative the group will focus on in 2022?  

JSB: We are excited to be focusing on our AD Rewards program. It has an eight-year history of driving sales at double the market rate in the Electrical-U.S. Division. Launched in the Plumbing and HVAC divisions last April, and currently introduced into our Industrial and Safety divisions, the program incentivizes our members’ sales teams to learn about and sell products from participating AD suppliers. It is tremendous value-add for our members as well as a fantastic engagement tool for our AD supplier partners. 

Conversions are the heart of our AD Market Planning Program, and we have invested additional resources to focus on them in 2022. Our members are very eager to support their AD suppliers, and we are looking forward to giving them some additional tools to help with this process.  

Finally, using technology will continue to be at the forefront of our innovative programs. The e-commerce program was a life saver for many of our members during the shutdown orders at the beginning of the pandemic and we will continue to help support our members with ease of business transactions.  

These are just a few, but they’re strong examples of how the AD team is out there advocating for members every day, negotiating for the best programs, and imagining new creative programs and services to bring value to AD businesses. We’re not about to take our foot off the pedal now. I know the same rings true for our determined, purpose-driven members. We’ve got new ground to cover. 

RM: For a company on the sideline who is not a member, what would you say to encourage them to contact your group for more information?

BW: We’d love to talk with you! We’re fortunate that so many members have decided to join AD, many from other groups. We’ve heard from these new members and their reasons span from best-in-class networking, reporting and meetings to unique, value-added programs and associates specifically dedicated to driving those programs. 

We are coming out of a few very stressful years stronger than we went in and that is a testament to the power of the AD community. While we weren’t immune from the effects of the pandemic, the challenges revealed what kind of partners members and suppliers had in each other, and how well the AD community’s values stood up in a time of adversity. We are poised for a record year and excited to help facilitate member growth throughout 2022 and beyond. 

RML Let’s make it easy for them – where can they go for additional information and an individual to contact? 

Please contact anyone on the team – we’re all glad to help.

Jeffrey Beall, jbeall@adhq.com

Justin Dunscomb, jdunscomb@adhq.com

Randy Lee, rlee@adhq.com

Prospective members can engage with us on LinkedIn, Facebook, and Twitter.    

The Commonwealth Group
(Tagline) United for Strength. Independent to Serve.
www.thecommonwealthgroup.com

On Jan. 1, 2020, two premier member-owned buying groups — Embassy Group Ltd. (established in 1991) and WIT & Co. Ltd. (established in 1974) — joined forces and merged to form The Commonwealth Group Ltd (TCG). It is comprised of 116 independent wholesaler members with more than 1,600 branches, 141 vendors participating in plumbing/PVF, HVAC and underground utilities/waterworks. TCG specializes in the plumbing, PVF, HVAC, waterworks, and irrigation industries.  

The member-owned and board/committee-driven group is committed to working toward collective goals and initiatives to ensure each individual owner’s success; TCG boasts combined sales of more than $9 billion. 

While TCG was formed in 2020, its first fully integrated in-person member meeting took place in late 2021.  Leading the way is President Mike Lepley, Senior Vice President Maureen Cosyns, Vice President of Finance Neil Mills and Director of Vendor Relations Jeff Smalley. 

RM: The definition of a buying group has extended beyond the focus of combined purchasing power.  Groups are incorporating tools to help members grow and expand their businesses – such as e-commerce platforms, marketing tools, payroll services and peer networking support.  What are the key member benefits offered by your group, and how do the offerings support growth within a member company?   

Mike Lepley: We don’t believe TCG should ever take our eye off of the leading reason to be associated with a buying group. The financial returns are priority No. 1 and always will be.  With that being said, there are services TCG provides that enhance its position.  TCG has a best-in-class payment and cashflow model. Our EDI initiative has paid major dividends to the membership and other services we continue to focus on bring down transaction costs.  

Our annual networking sessions and structure continue to foster best practices among our membership throughout the year. Shared data and content will continue to be key moving forward as many of our members have e-commerce platforms and are looking to TCG to provide a community to help facilitate a shared cost and content hub. 

RM: Navigating through a pandemic wasn’t easy — and wholesale distributors leaned into their buying groups for support. What existing avenues of assistance did members lean into, and what new tools/offerings were developed?  Are the new items now permanent offerings? 

ML:  Virtual meetings and facilitating best-practice sessions remotely helped. However, virtual meetings will never usurp getting together face-to-face. TCG’s Annual Shareholders Meeting in September proved to be a powerful reminder of this, as this non-mandatory meeting had more than 80 percent participation.  

RM: How did the group strengthen relationships and partnerships between members and suppliers over the last 20 months? How does this bond help members in their daily book of business? 

ML: Communication was key. Our group is large in volume but limited in membership. We were fortunate as we were constantly in touch with our members and our vendor partners. Whether it was person-to-person, print updates, email, Zoom meetings, or a phone call, these touch points were extremely valuable to all TCG members and vendors. We also have extremely dedicated board and committee members who are committed to providing an engaging and collaborative environment for our members and vendors.

RM: In what areas do you see growth potential for your members?

ML:  Consolidation will continue to be a constant. TCG members are looking to grow by acquisition and adding new locations. It also is expanding into new verticals that will continue to add value for current members, along with providing an attractive alternative to future members.  

RM: For a company on the sideline who is not a member, what would you say to encourage them to contact your group for more information?  

ML: TCG is very large in volume but limited in the number of members. We will never be hundreds or thousands of members large. We are a group where it is easy to know all of its members; it’s truly a close-knit organization that enjoys working together. We also are a group that never forgets about the financial returns, operates with a small overhead (eight employees), and ensures the very best in customer service experience for our members and vendors.  

RM: Let’s make it easy for them — where can they go for additional information and an individual to contact?  

ML: Visit TCG’s website a ; or visit our LinkedIn page. In addition, feel free to email me at mlepley@thecommonwealthgroup.com or Maureen at  

mcosyns@thecommonwealthgroup.com

IMARK
(Tagline) Building Success ONE Member at A Time
www.imarkplumbing.com

IMARK Group is a multivertical, member-owned and -governed group of independent distributors that generates annual sales volume exceeding $28 billion in support of the electrical/utility, HVACR and plumbing industries. IMARK Group consists of three industry verticals: IMARK Electrical, IMARK Plumbing (Luxury Products, Irrigation, Waterworks and PVF) and BLUE HAWK (HVACR), an owner of IMARK Group.  Look for a feature on BLUE HAWK in the March issue. 

Working together, these groups make their individual member-owners stronger by offering better programs and access to better cost-saving initiatives than they could on their own. At the helm of IMARK Plumbing is President John Aykroyd. 

Membership in IMARK Plumbing includes 640 member companies that have more than 1,330 locations, 155 plumbing suppliers (manufacturers), 60 plumbing service providers (other vendors), and 440 plumbing/lighting showrooms with 995 locations.   

The Luxury Products Group (LPG), which serves the needs of plumbing and lighting showrooms, showcases 67 showroom plumbing/lighting suppliers and 20 showroom service providers. 

Recently launched, IMARK Irrigation, Waterworks and PVF have experienced rapid growth.  Industry veteran, Scott Bardreau, vice president, is spearheading the group’s expansion and reports 155 member companies with over 320 locations participate in these new verticals.  

The mission of IMARK Plumbing is to help independent wholesalers thrive and generate the highest possible financial returns while delivering above-market performance in volume and market share to an industry-leading group of manufacturers. “We strive for a win-win in everything we do, and are driven by our core values,” Aykroyd says.  Those core values include a family culture, profit-minded, humble confidence, passionately progressing, and members’ willingness to share. 

“Combining our core values with our innovative marketing programs and resources is all designed to spur greater collaboration between our member distributors and IMARK suppliers to increase sales and profits, he explains. “Our aim is to provide a combination of marketing solutions and superior financial returns to our members, while delivering above-average rates of market share growth for our supplier partners.,”  

Jeff MacDowell, executive director of LPG, notes that its mission is to “provide our members a competitive advantage financially and professionally, with select products that define luxury in their marketplace, and to provide a solid partnership which is equally advantageous to our suppliers.” 

RM: The definition of a buying group has extended beyond the focus of combined purchasing power.  Groups are incorporating tools to help members grow and expand their businesses — such as e-commerce platforms, marketing tools, payroll services and peer networking support.  What are the key member benefits offered by your group, and how do the offerings support growth within a member company? 

JA:  Our passionately progressive culture has driven the group to expand beyond the traditional role of a buying group. For example, with the synergy and scale of IMARK Group’s 1,600 wholesalers with more than 6,500 locations, we developed a Health Insurance Captive Plan. Like all businesses in the United States, IMARK group members are frequently faced with increases in the costs of providing high-quality health insurance to their employees. IMARK Group members can now join a captive insurance plan and can expect savings on health insurance premiums.   

[Editor’s note: A captive insurance company is a licensed insurance company fully owned and controlled by its insureds. Instead of paying to use a commercial insurer’s money, the owner invests its own capital and resources, assuming a portion of the risk (https://bit.ly/3qAvaS7).] 

In addition, we established an IMARK Group Retirement Plan, a multiple employer retirement plan (MEP). MEPs allow multiple business to join one retirement plan and operate it as a single entity, rather than each business operating a separate retirement plan. MEPs offer cost savings and improved services with efficient administration of common back-office tasks. Also, by leveraging scale and purchasing power in negotiations with service providers, the IMARK Group Retirement Plan drives cost down for all participating members. 

Networking and building relationships are a fundamental principle for our group and demonstrates our membership’s willingness to share ideas and assist fellow members in all aspects of their business. I-Net Meetings provide IMARK member owners and senior executives with a formal peer networking session to discuss their challenges, share ideas and review solutions leading to best practices for business improvement. I-Nets have proven to be an indispensable resource and have strengthened business relationships and built lasting friendships among fellow IMARK members.  

Data is power and the IMARK DASHBOARD offers numerous data points that benefit members and suppliers. Members have access to in-depth analytical tools to help them better manage their experience with the group; they provide guidance on maximizing members’ total rebate earnings through the group’s supplier partners.  

For our Supplier partners, the dashboard provides multiple analytical sales tools to aid their sales efforts and to help them better manage their overall relationship with the IMARK membership. Suppliers also gain insight on new business opportunities to grow sales and market share with IMARK members.  

Our innovative marketing programs promote greater collaboration between our members and suppliers, which has led to above-market growth and enhanced profitability:   

• The IMARK GainShare Joint Market Planning program offers members the opportunity to set purchase objectives with select supplier partners. Members are encouraged to conduct joint sales and marketing activities with local sales reps to drive sales growth, gain market share and increase profits for both members and suppliers. 

• IMARK University provides member personnel with access to high-quality, web-based learning materials regarding the products and applications of all major commodity products in the plumbing industry. The learning modules provide practical, efficient training so IMARK members can grow sales and solve customer problems.

xTeach, a microlearning platform, provides training models on soft skills in leadership, selling and merchandising, and best practices to enhance counter sales. Most courses can be completed within four-to-six-minute increments. It is the only platform of its kind in the industry.  

• Digital Impact provides suppliers with the ability to place banner ads on key sections of the IMARK website. Digital Impact advertising creates awareness of opportunities for member employees to increase sales, educate customers on new products, and increase productivity and efficiency among installers.  

• IMARK PLUMBING NOW Magazine is our flagship publication. Published quarterly, it reaches more than 3,000 member employees. Each issue includes articles that focus on industry trends, leadership skills, best business practices, management and marketing.  

RM: Navigating through a pandemic wasn’t easy — and wholesale distributors leaned into their buying groups for support. What existing avenues of assistance did members lean into, and what new tools/offerings were developed?  Are the new items now permanent offerings? 

JA: During the throws of the pandemic, we realized that assisting the membership with cash flow was a critical priority. Working in unison with our supplier partners, we shifted a greater percentage of rebate earnings from quarterly pay to monthly distributions. The quicker distribution of rebate funds provided critical relief to many members during those difficult times. Monthly rebate distributions are now a permanent benefit for the membership.  

In addition, LPG members use a private Facebook group to help locate obscure products, source items on backorder and solve showroom problems.  The group has more than 260 members that openly share and help each other to help serve their customers. 

RM: How did the group strengthen relationships and partnerships between members and suppliers over the last 20 months? How does this bond help members in their daily book of business? 

JA: To encourage a higher level of collaboration between members and suppliers we introduced the Member Premier Program and the Supplier Gold/Platinum Program. 

The Member Premier Program recognizes members that are fully engaged with IMARK suppliers and are effectively using IMARK marketing programs and resources. The program tracks activities accomplished, and results achieved throughout the calendar year. 

The Gold/Platinum Program provides a road for suppliers that intend to maximize their affiliations as an approved IMARK supplier. Suppliers receive recognitions for activities accomplished and results throughout the calendar year.  

RM: Many would say that it’s not a buying group, but a community. Can you share with us how members supported one another over the past 20 months? 

JA: Many of our members using our social media platforms connected to discuss much more than product-related issues.  They chat about everything from the new stresses of COVID-19 at the workplace, dealing with employee burnout, and how to help each other work on their businesses, not just work in the business.  We are all helping each other become better in distribution. 

RM: The way business is conducted has drastically changed since the pandemic — supply shortages, labor shortages, transportation and logistics issues have made for the perfect storm. What resources are available to members to help their companies navigate the challenges?  

JA: In these challenging times, sourcing material from fellow members is vital to the entire membership and helps the group maintain our purchasing power by keeping business inside IMARK. We developed two new resources, located on the IMARK website, to assist members on connecting with fellow members:  

• LINK provides a digital list of fellow members who sell a particular brand or manufacturer. Members are listed in geographical order and contact information is provided. Members now have a quick and easy resource to aid their efforts on sourcing products from fellow members. 
• IMARK Group Member Locator is used to identify IMARK Group member distributors in a particular geographical area. Members can seek out fellow plumbing members and also search for decorative showroom, electrical and HVACR members. 

RM: In what areas do you see growth potential for your members? 

JA: Results from a member 2022 Sales Outlook survey indicate that the majority of IMARK members are bullish on sales growth into 2022.  Residential (single family and multiple family) are leading segments for projected growth, followed by commercial, institutional, industrial and irrigation/waterworks.

In terms of growth opportunity for IMARK Group, COVID-19 has sparked an unprecedented surge in consumer spending on interior home improvements and outdoor living/entertainment spaces.  LPG members expect strong demand on kitchen and bath remodel projects throughout 2022.  We also are experiencing explosive growth within IMARK Irrigation as homeowners are turning their backyards into outdoor oasis living spaces.    

RM: What is a strategic goal or new initiative the group will focus on in 2022?   

JA: With the ever-increasing pace of industry consolidation, promoting IMARK Growing Forward is priority initiative. The program is designed to maintain and grow the group’s purchasing power by alerting member companies of fellow IMARK Group members companies that are in acquisition mode.  

While family considerations are of principal importance during the company sales process, many member-owners of independent distributors often feel that the best thing they can do for their employees and customers is to so sell their companies to fellow independent distributors. This initiative has resulted in far more member companies selling to IMARK peers and has kept that purchase volume inside our organization. 

We will also be focusing on e-commerce and marketplace initiatives to help our members compete with not only our traditional channel, but also with upcoming competition from outside our channel.  Plumbing, electrical and HVACR systems are coming together through technological advances; purchasers of these systems will look to distributors that can effectively combine those products to reduce procurement costs.  

RM: For a company on the sideline who is not a member, what would you say to encourage them to contact your group for more information?

JA: IMARK Plumbing is much more than just a buying group. We offer innovative marketing resources, business coaching, multiple training platforms, social media support and proprietary process improvement ideas at no additional cost to a member.  We reward our members for their alliance to our supplier partners.  The best part of IMARK Plumbing is its members’ humility and willingness to share.  Just as theirs is a family business, we feel and treat one another like a family; you won’t find better networking and sharing anywhere in the industry. 

RM: Let’s make it easy for them – where can they go for additional information and an individual to contact?  

 JA: Our website, www.imarkgroup.com, is a great starting point and provides full details on member and supplier benefits. Plumbing wholesalers, contact Matt Roos, 843-422-0067,  mroos@imarkgroup.com.

For decorative showrooms, contact Jeff MacDowell at 330-274-1225, jeff@luxuryproductsgroup.com.

For Irrigation, Waterworks and PVF, contact Scott Bardreau, 214-801-2131, sbardreau@imarkgroup.com