Coming Back Home

Shawn Niehaus is in the tool distribution business for the second time.

After attending school in Texas, he and his wife returned to home to Duluth, MN, to start a family. His father had left the repair shop by then to become a franchise distributor, and when another route with the same flag became available, Shawn jumped at the opportunity. He became a tool distributor for the first time in 2003.

Having worked as a tech, he knew something about tools and the people who buy them. With Dad as his advisor, he never doubted he would be successful, but he hadn’t counted on the role his customers would play in his future.

Another career opportunity

After seven years, Shawn left the franchise to open his own financial services company. Things were going well, but the new distributor who took over his old route lasted only six months, and Shawn’s old customers started calling him.

“A lot of my customers called me and said ‘we need you to come back.’ Another franchise dealer in the area advised me to come back as an independent, and he turned me on to Neu Tool.” His father offered similar advice, and Shawn says “I already knew what the franchise could teach me, so I came back as an independent. If it wasn’t for Dad’s advice, I don’t think I would have made it.”

Shawn stocked his new truck from several WDs, but just as a distributor builds relationships with his customers, the Neu Tool salesman, Brad Clabaugh, built a relationship with Shawn.

“People that I do business with earn my business, the same as my customers are about me. Brad has treated me so well that he gets about 90 percent of my business now. If I order something from him by 3 PM, I have it the next day. If I order freight (big items or larger orders) by 2 PM, it’s in the next day. Even parts houses have a hard time competing with that.”

On his own terms

Family life is the most important thing to Shawn. “I only want to work as much as I have to.” Being independent has let him build a route that requires a minimum of windshield time. He covers only 20 percent of the area of his old route, but he sees more customers.

In a 40-hour week, he drives 300 miles, making 80 stops to collect from 350 people. He does put another 15 hours a week into his business, but that’s after his two young sons have gone to bed.

More family time became available when Shawn found a way to complete the route in only four days.

One of his stops is a VoTech school, and when that closed for the summer it freed up half a day. “I just moved all the other Friday customers to Tuesday. They don’t really care as long as I’m there every week.” What surprised Shawn was that his sales and collections went up almost $2,000 a week. “I don’t know why, but it happened at the same time. I (just) adjusted my daily goals to compress five goals into four days.”

The software Shawn uses is also a real time-saver; All-Soft Tool Manager. He uses it to handle point-of-sale tasks, manage customer accounts and for inventory management. Neu Tool updates the prices in his database, and when he talks with Brad he just types in the tool number without the warehouse prefix to see each vendor’s price. “It kind of forces Brad to match prices too, but he appreciates it when I point out the difference. It helps him stay competitive and I don’t have to do all that work to check each vendor.”

Why it’s working

Shawn attributes part of his success to former competitors. “There’s nothing better for a good tool guy than a bad tool guy. A tool guy who mistreats his customers will make them angry, and they all talk to each other about him. Somebody will say ‘I’ve got this other guy that I really like, so you should call him.’ That’s what I learned when I went independent after driving for a flag. It’s not the brands that I carry, it’s the person who walks into that shop. If you take care of the guys, they’ll come back to you every time. The goal is to be the first call.”

He feels his real competition is not other tool distributors, but parts stores, retail stores and the Internet. “(My customers) don’t really buy from them, but they want me to match their price.”

Shawn says his tools are “identical to what you see on the franchise trucks, the exact same tools,” and even though some are priced lower at retail stores, customers recognize it as a product that holds up and comes with a warranty. “So they would rather buy from me ‘cause they want me to come by with it on the truck right now.”

It’s probably no surprise to learn that scan tools are not one of his favorite things to sell. “As soon as I get it into their hands, they’re disappointed because they find out it doesn’t do what they thought it would do. If they buy it and don’t like it, I’m getting it back.”

Shawn knows the real problem is a lack of training, so he has sought help from Ed Lipscomb, the product manager at OTC who works with the Genisys diagnostic tool. “He’s sending someone here to run a training class. If I can offer training, that will help me sell diagnostic tools.” Shawn is hoping to arrange training every quarter.

The right support

What Shawn likes most about being a tool distributor is the freedom. “The joke is that you get to choose your own 80 hours a week, but I also get to choose who I do business with, how much I want to do and when I want to do it. (I have) the freedom to be the kind of dad I want to be."

Since his father’s advice played an important role in Shawn’s decisions, we asked what he would say to people just starting out today. “Depend on the support group that you have. IMTDA (Independent Mobile Tool Distributors Association) is only a few people but they’re good mentors. Without a group like that, start with a franchise. But remember they’re in it to make money too.”

“For me, having the support of family is key to what I do. It would be for naught if I didn’t have their support and encouragement.”

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