We spoke to independent distributor Steve Johnston in front of a brand-new tool truck on display during ISN Tool Dealer Expo 2024. The display truck was as shiny as it was comfortable, and it was loaded with pristine shelves, spotless carpeting, display areas, and an equally new refrigerator with a sparkling glass door near the front. With all of its features and add-ons, Johnston was impressed with the truck, but he wasn’t interested. He’s a huge proponent of buying a used truck and avoiding the sticker shock of a new or wildly customized one.
“When it comes to what am I looking for as an upgrade on a truck, I'd love to have that new truck,” he said. “I'd love to have the video screens and tool videos playing all the time and the refrigerator. That's all neat stuff, but I promise you, I can get a refrigerator out of a motor home and put it on my ‘96 model and get a computer to stream and run videos, it’d cost about $300. Why would I spend $225,000 for a new truck?”
Johnston said that he’s had plenty of competing distributors show up in brand-new trucks with flashy vinyl wraps ready to knock him out of the market. Those types of distributors are usually gone within two years, he said, and Johnston is still kicking – at least for another few years, though he’s eyeing retirement.
With decades of experience in the tool distribution business, he’s seen countless other distributors come and go, as well as the constant increase in costs. Still, he's undeterred.
“I’m sure you’ll find a guy ... who says having a new truck really gives me an advantage over old Steve and his 25-year-old fossil that smokes and sputters and whatever they want to say about it. I don’t care. But the proof is I’m still liquid after 20-however many years.”
'I need to be smarter than my customer'
It’s not just what you’re driving that affects your bottom line as a distributor, it's what’s in it that really changes things. Of course, Johnston keeps a healthy supply of staples – sockets, impact tools, and so on – but how does he keep the rest of his inventory feeling fresh and useful for his customers?
“Being here,” he said, gesturing to the ongoing expo around us. “Staying current with my knowledge base. For the things that I sell, I need to be smarter than my customer when it comes to what’s the latest, greatest thing from CPS, what’s the newest thing from Power Probe. I need to keep that rotating through my truck. You got to have a working base, but the specialty tools need to rotate through.”
Johnston spends a good amount of time at the shows checking off his list of requests from customers about new products and possible deals. He’s able to work with his customers’ needs and get them better prices if they’re willing to wait an extra few days for him to return from whatever show he’s visiting, but he’s quick to point out that attending industry events comes at a cost.
“It cost a bit to come down here,” he said. “It cost me my busiest day of business. Friday is the [busiest] day, and I didn’t spend it selling and collecting. I spent it here spending and learning. Hopefully, it’ll pay off. It’s an investment. Going to shows is an investment in my time and knowledge, so [my customers] benefit from it.”
Ultimately, as Johnston sees it, tool distribution is about a lot more than the numbers involved or sales. Those are secondary to the relationships formed with customers.
“I’m not in the price business, I’m in the service business,” he said. “I only sell services. There’s nothing that you can buy from me that you can’t buy somewhere else cheaper. If service is not worth anything to you, you’re in the wrong place.”
