Moving the Cooperative forward

As president and CEO of Johnstone Supply, the nation's leading cooperative wholesaler distributor in the HVACR industry, DeWight Wallace says his role is similar to herding cats — persuading successful, independent business owners to move in the same direction. “We have talented business owners who are operating in their own markets, and it's herding them in a way to leverage the power of the cooperative and making sure the cooperative is providing them with what they need,” he says.

The cooperative continues to grow in both size and scope. With more than $1 billion in annual sales, Johnstone Supply now has more than 350 independently owned stores across the United States and five regional distribution centers. According to Wallace, Johnstone Supply is investing heavily for growth as it explores new opportunities while continuing to provide customers with its breadth of products and outstanding service.

Wallace, who took over the top job at Johnstone Supply in December 2009, is spending lots of time on the road to get a better idea about those opportunities, which have become part of a strategic plan to guide the cooperative into the future. The goal of the plan, Wallace says, is to build on its strengths of locally owned stores with the backing and power of a national cooperative. “We leverage the fact that we're a cooperative; we leverage those touch points with the customers through our store owners nationally,” he says.

Five regional meetings across the country with store owners helped give him a better sense of customer needs and how those needs could translate into an improved value proposition for their customers. Johnstone owners know their local markets, and they're passionate about the products and service they provide to their customers. “The owners own those customer relationships as opposed to a franchise where you own it nationally and hire a store manager,” Wallace says. “We have people that actually drive these businesses aggressively. I think that's the core strength.”

That core strength — the local owner — magnifies what the national cooperative brings to the equation. In Johnstone's case, it is national buying power and the ability to offer specialized regional distribution so local stores can order what they need and receive it — usually by the next day. The distribution centers are set up to meet the specific needs of the stores within their individual regions.

Johnstone's product offering, encapsulated in its annual product supply catalog, continues to grow. The company's aim, Wallace says, is to be the “one-stop shop for our customers.” Johnstone has a product management team focused on sourcing the right products and working with its vendors to build strong relationships to negotiate the best deals for its members.