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By Harrell Kerkhoff, Maintenance Sales News Editor

The global pandemic has caused major shifts, disruptions, challenges and opportunities for companies and professionals involved in facility supply distribution. It’s a situation that’s likely to continue for the foreseeable future.


Michael Marks

Throughout the turmoil, one part of business has not changed — the importance of cash flow. Michael Marks, founding partner of Indian River Consulting Group
(ircg.com), discussed the topic during his presentation, “Cash Flow Management As A Competitive Weapon.”

“The amount of money a company makes is a function of executive decision making. We are all in the middle of a major disruption (with the pandemic),” Marks said. “It’s important to think about the impact of cash, and how it should be properly monitored and used within your organization.”

His discussion focused on three main topic areas: forgotten cash flow basics, supply chain alternative approaches, and a brief bottom line.

FORGOTTEN
CASH FLOW BASICS

Profit is not the same as cash. The thing that can ruin a distributor is not losing money, but running out of cash, according to Marks.

“The interesting thing is, most failures occur in the recovery phase of an economic cycle,” he said, adding many distributors were “sitting on a lot of cash” by mid-2020, especially after the federal government’s PPP (Paycheck Protection Program) became available.

“Now in the recovery phase, cash can ‘vaporize’ very quickly, and many asset-based loan covenants can be in jeopardy, triggering hard decisions. Company owners are often shocked and surprised when that occurs,” Marks said. “Trying to grow your way out of operating losses will not work. It’s also important to manage your receivables and understand that poor liquidity equals poor leadership.”

Under the current business climate involving many distributorships, Marks added that working with a funds flow statement is more important than a P&L (profit and loss) statement or balance sheet. Monitoring a two-week planner that focuses on ‘beginning cash, cash in, cash out and ending cash’ can be the best way to closely manage a company’s cash flow and availability.

“My advice for distributors (when trying to preserve cash and eliminate risk) is to conduct a stress test, involving a recovery scenario,” Marks said. “Stress testing, such as what the banking industry did after the Great Recession in 2009 and 2010, uncovers a company’s actual financial limits and doesn’t involve opinions. It’s testing, not predicting or forecasting.”

He added that stress testing is a means to measure the resilience (time before running out of cash or blowing a lender covenant) of a business, when subjected to unexpected shocks. It’s used to find:
Outside ranges of potential revenue increases during the next 12 months;
Understanding how long certain conditions will continue, including issues with supply chains; and,
How comprehensive a company’s contingent-designed cost reduction program is, and how effectively is it being executed.

“Stress testing helps eliminate surprises and provides added time, if corrective action is needed,” Marks said.

When implementing a basic cash flow action plan, Marks recommended the following for company leaders:
Start a two-week cash flow planner;
Focus on receivables and subscribe to a credit update service. The latter can help company officials look for financial distress among those businesses that their company does business with on a regular basis;
Consider innovative approaches to supply chain issues; and,
Get to know lenders before there is a need for their money.

Although the current pandemic has placed many obstacles in the way of conducting business, there are opportunities as well. That includes adding marketshare. Marks said marketshare gains are often connected to properly managing risks.

“It’s best to take risks that you understand, and avoid risks that you don’t understand,” he said.

He listed four factors to predicting marketshare gain. They are:
Leveraging a strong balance sheet;
Align limited resources to customers that will most likely survive;
Remain a optimistic leader to customers, helping them as they create the new normal in business; and,
Be willing to make investment bets.

On the flip side, Marks listed five factors that can predict marketshare loss. They are:
Serious cash flow issues;
Blindly taking care of a company’s largest customers, while ignoring many others;
Being fearful for the future and hiding under a “shell” while waiting for troubles to pass;
Failing to increase margins during today’s supply chain challenges; and,
As the market recovers, running out of working capital.

SUPPLY CHAIN
ALTERNATIVE APPROACHES

Marks presented a history lesson on the evolution of the global supply chain since World War II. He noted that the 1944 Bretton Woods Agreement, which involved countries from around the world, created a safe and predictable foundation for global commerce. It leveled the playing field related to schedule and delivery consistency, and better optimized speed, creating just-in-time delivery possibilities.

According to Marks, during the last half of the 20th century there was significant growth in global trade, helping reduce poverty. Global economic demand was increased and led to the creation of new businesses in many countries. What also followed was “good, better and best” product quality standards.

“With reliable and consistent global deliveries, and many suppliers able to compete on quality, the only factor left was price. Therefore, supply chain activity became more focused on reducing purchasing prices,” Marks explained. “In the quest for lower prices, labor arbitrage in low-wage countries made those countries major players in the global supply chain. Decades of supply chain stability narrowed the focus of most sourcing professionals as they concentrated on the next ‘upstream supplier.’ As a result, awareness of the entire value chain declined.”

He added a fundamental law of economics states that when an economy becomes more efficient, it also becomes more brittle and less resilient.

“For example, can you imagine what would happen to global economies today if suddenly there was no internet?” Marks said. “Every day is seen as ‘combat’ right now (within the global supply chain). When that happens, it all becomes about price. That is what everybody wants to talk about. The question is, how do you fix that mentality.”

There are many resiliency and whipsaw effects in play, when it comes to global supply chains.

“A ‘force majeure’ can be declared four steps back within any value chain. That can paralyze every downstream member of a supply chain long after a problem is corrected,” Marks said.

Resiliency, he added, is the ability of a process or system to take a shock, and still perform at the minimum required performance. Resiliency is increased with redundant processes or designing something to be operated at 70 percent of capacity. Both add recurring downstream costs. Marketplaces also increase resiliency, but costs are often absorbed upstream.

“Supply chains are optimized when demand and supply are balanced within the desired economic standard deviation for fluctuation,” Marks said. “Just like a pendulum has a shortening swing until it is at rest, shortages and gluts continue at lesser magnitudes in supply chains until balance is achieved.”

A simple definition of “supply chain” is the act of moving products and services through to end-users. An unprecedented period of disruption within the global supply chain, however, continues due to the pandemic.

“There will be ongoing and isolated whipsaw effects over the next several years as the weakest link in each and every value chain rebuilds. Also, the recent focus on resiliency will slow the eventual recovery, i.e., reshoring,” Marks said. “The global response thus far (to supply chain challenges) has been to do the same things as in the past, but with more urgency, more frustration and more anger.

“The question to ask, ‘Is it time to consider a range of different actions related to supply chains, involving different business models?’”

He added that customer-specific solutions to supply chain challenges generally work better than broad or rigid policies. Short-term tactical alternatives for better supply chain optimization involve three areas that Marks described as: “Flow Business,” “Project Business,” and “Both.” Benefits are:

Flow Business

Provide price discounts for deliveries scheduled beyond 90 days; and,
If there are large and demanding customers (perhaps involving low to zero net profit) who want to take everything (in inventory), consider allocating a limited portion of available product to each of those customers, based on interpretation of what is best.

Project Business

Conduct training classes for customers, helping them manage their own downstream customer expectations, perhaps offering to participate in a pilot program to develop a pull replenishment system;
Get customers to change their bid process, and as a distributor, join that process from the beginning, which can drive availability; and,
Have the manufacturer, distributor and contractor post a delivery performance bond, to be provided to the end-user if late.

Both

Shift selling resources to expediting, keeping customers informed of daily changes;
Offer cash in advance to upstream suppliers to counteract FIFO (First In, First Out) procedures, as demand stresses working capital in smaller firms;
Given current industry turmoil, conduct activity-based costing to measure net profit by customer, and then raise prices on those customers that are not currently profitable for your company; and,
Collect data on delivery date change patterns to improve predicted probability on delivery date accuracy.

Marks also recommended the book, Innovate To Dominate, by Mark Dancer, which he said focuses on ways distributors have gone beyond the status quo to improve supply chain options, gain customers and improve profits.

“There is a global conversation going on in today’s business about doing things differently for better outcomes,” Marks said. “Meanwhile, major consulting companies are addressing three critical areas: No. 1, How to get ahead of the supply chain; No. 2, How to deal with the great resignation of talent; and, No. 3, How to change the business model for the new normal.

“It’s important to be part of those conversations, and include your company’s CFO. I would also recommend looking for a current, or potential, partnering company, one that is involved in either the upstream or downstream value chain, and perhaps has a problem that it wants to address. Connect your CFO with their CFO in an effort to explore areas of potential collaboration. Also, engage with a neutral third party if a black box analysis (used to find vulnerabilities) is needed.”

A BRIEF BOTTOM LINE

Hunkering down and waiting for challenging times to pass is potentially a risky choice, according to Marks.

“Recognizing that the effects of this pandemic will be with us for a long time, and things will never truly go back to the way they were in January 2020, is important,” he said. “The real question is not when will (the pandemic) be over, rather it is how do you, as a company, continue and win? For example, the pandemic has accelerated the changing role of the field sales rep. How do you, as a distributorship, respond?

“I recommend companies conduct a stress test to remove uncertainty, and if cost reduction is needed, to do so deep and fast. Speed is a weapon. There will be opportunities to upgrade staff. Optimize your strength for the pandemic recovery point while protecting your core team.”

Marks also recommended distributorships develop strategies and scenarios to exploit ongoing market disruptions. The idea is to develop aggressive and quick reactions to new opportunities.

“During any major market disruption, the act of initiating has much more value than just reacting,” he said.


DDI Hosts Webinar Thursday, April 21



From ACS Products Group:
Dubble Scrubble Hand Pad

A double duty, light and medium scrubbing power in one pad:
• Dubble Scrubble is a two-sided, non-woven hand pad;
• White light-duty side is great for delicate surfaces that can scratch easily such as Teflon®, Silverstone®, Plexiglas® or other sensitive surfaces;
• Green medium-duty side is great for scrubbing pots & pans or tough stains that need extra power;
• Hourglass shaped to fit your hand’s grip;
• Curved ends to reach inside round corners; and,
• Manufactured using UL® validated 100-percent PET recycled pad material.

For more information, visit acs-cp.com.

 


Stanley Dean Koschnick
France Broom Company
Nexstep Commercial Products

Stanley Dean Koschnick, 78, of Buckley, IL, died April 10, 2022, at home, surrounded by family. He was born November 8, 1943, to Leonard and Selma Theesfeld Koschnick.

He married his wife of 36 years, Shelley Sue Deck, August 16, 1985. They had two sons, Terry Dean and Troy Dean, who both preceded him in death. He was also preceded in death by both parents and his brother, Wilfred Koschnick.

Mr. Koschnick is survived by his wife, Shelley; four grandchildren, Sadie (Parker), Lannie, Shanice and Tyler; five great-grandchildren; one godchild, Shayla Vermillion-Burton; his sister, Pat Henrickson; as well as several nieces and nephews.

He graduated from Buckley-Loda High School (IL) in 1961. He then joined the United States Army from 1969-1971, and was stationed in Okinawa.

He was co-owner of France Broom Company, and co-owner/plant manager of Nexstep Commercial, retiring in 2014, after 53 years.

He was a member of St. John’s Lutheran Church, Buckley. He was mayor of Buckley for 12 years, president of the Buckley Fire Department for six years, and a member of the Buckley American Legion Byron A. Hickerson Post 432. He was an avid fan of the Buckley Dutchmasters. He was a former member of the Lions Club.
He loved golfing, fishing, playing cards and spending time with family and friends. He was well known for his sense of humor.

Funeral services were Thursday, April 14, 2022, at St. John’s Lutheran Church, Buckley. Burial was in St. John’s Cemetery, Buckley.

Memorials may be made to St. John’s Lutheran Church, St. John’s Lutheran School or Christ Lutheran High School. Condolences and memories can be shared with the family at baierfuneralservices.com.


From Nyco Products Company:
HPX Hydrogen Peroxide Disinfectant Cleaner Awarded EPA’s DfE Certification

Nyco Products Company announced its new HPX Hydrogen Peroxide Disinfectant Cleaner is now EPA Designed for the Environment (DfE) certified for using green chemistry.

According to the EPA website on DfE certified disinfectants, “The Design for the Environment (DfE) label helps consumers and purchasers find antimicrobial products, like disinfectants and sanitizers, that have been reviewed by EPA, and found to meet both the pesticide registration requirements and the standard for DfE-certified products. These products contain ingredients that have been reviewed for both human health and environmental fate.”

Nyco said, “HPX is a ready-to-use disinfectant formulated with enhanced hydrogen peroxide technology. As a naturally occurring compound in the earth’s atmosphere, hydrogen peroxide (H2O2) is more sustainable for the environment and safer on surfaces. The non-toxic formulation breaks down into water and oxygen, and leaves behind no residue. HPX is a safer disinfectant for people and for the environment, as compared to other disinfectants formulated with less safe active ingredients.

"HPX is EPA registered as a disinfectant, cleaner, mildewstat, virucide and deodorizer for homes, institutional and industrial use.”

Brendan Cavanagh, vice president of sales for Nyco, said, “Not only is HPX safer and more sustainable, it’s highly effective against many dangerous germs. For example, it kills the COVID-19 virus in a minute or less, and also kills the flu virus in just three minutes. Our customers really appreciate how effective HPX is against COVID specifically, but other seasonal germs as well.”

According to a press release, hydrogen peroxide-based disinfectants like HPX make particularly good restroom cleaners. HPX controls mold and mildew, whitens grout, removes soap scum, disinfects high-touch surfaces, and eliminates odors. It is appropriate for all facilities, but especially those with green mandates — often schools, day care centers, healthcare facilities, and LEED Green Certified buildings.

HPX Hydrogen Peroxide Disinfectant Cleaner provides environmentally sustainable disinfection for cleaning professionals and consumers who want to use green cleaning solutions without compromising core cleaning performance. And now with DfE certification for using green chemistry, it will provide cleaning professionals and consumers the peace of mind that these products are intended to do.”

Nyco Products Company is a privately-owned manufacturer of high-performance national cleaning brands and distributor of private branded chemicals used in the sanitary maintenance, industrial, institutional and other specialty cleaning markets.

For more information, visit nycoproducts.com.


From Lindhaus:
Backpack Vacuums Shown To Increase Worker Productivity

According to a recent study, demand in 2022 for backpack vacuum cleaners will have significant growth from previous years.

“Even the most conservative estimates of backpack vacuum cleaner use predict the highest demand on record,” according to Lindhaus, maker of the LB4 Digital Pro Lithium-Ion battery-powered backpack vacuum.

“Those in charge of cleaning restaurants, theaters and office buildings are all coming back to use these items, in association with a dwindling labor force, which presents a new set of challenges for facility managers and all business owners. Proper floor care represents almost 50 percent of maintenance labor. Backpack vacuums are an easy way to increase productivity in this area.”

According to Lindhaus, its LB4 Digital Pro is the world’s lightest battery-operated backpack vacuum cleaner, at 8.3 lb. with battery. The company is also manufacturing “the finest battery-operated power nozzle on the market.” Now any backpack vacuum cleaner can be equipped with the PB14e L-ion battery-power brush, to increase efficiency in cleaning carpets, rugs and mats.

The PB series was designed for industrial use. Lindhaus engineered this accessory with commercial components. Benefits include:

• ELECTRONIC LOGIC — The electronic control is equipped with a soft start to avoid current peaks to the battery and motor, protecting the motor and transmission from overload;

• DYNAMIC BALANCING — Long service life and low vibration levels are achieved with superior engineering and precision manufacturing. All rotating components are balanced and protected by electronic controls;

• OVERLOAD PROTECTION AND BRUSH SENSORS — This feature assists the operator in adjusting the ideal height of the brush, according to the type of carpet to be cleaned. If the roller gets stuck, it turns off the engine instantly; and,

• ULTRA HIGH-SPEED BRUSH — Turns at 4000 rpm and is kept constant as the load changes. This high-speed brush is effective on embedded dirt and debris, yet protects the very fibers it cleans with an exclusive nonabrasive brush design. It requires no maintenance of the toothed belt, motor and electronics.

“Two hours of charging will provide the user with almost a full hour of operation per battery. The batteries pop in and out with the ease of any cordless tool,” according to Lindhaus. “With an extra battery, the user can employ the one-and-one method (one in the powerhead and one in the charger) for almost unlimited cleaning.

“Not just for battery backpack vacuums, the PB14e L-ion will fit easily on any corded backpack for an easy upgrade to the hassle of external cords and plugs.”

Contact Lindhaus at 1-800-498-7526 for more information.


From Queenaire Technologies:
Hydroxyl Air Treatment & Ozone Generation Eliminate Odors

With established brands Newaire, Rainbowair and Queenaire in place, and a management team with over 30 years of odor control experience, Queenaire Technologies provides various products that incorporate up-to-date ozone generating technology as well as hydroxyl air treatment to an expanding marketplace.

“Using ozone is especially good when getting odor out of surfaces, while hydroxyl works well at cleaning the air,” Queenaire Technologies President Susan Duffy said. “A great product for doing both, at the same time, is the Newaire™ HO3 - 2500 Air & Surface Treatment System. It incorporates the best characteristics of each type of air and surface treatment.

“The Newaire™ HO3 - 2500 can be used as an hydroxyl generator, in areas where people are present, to get rid of odors, bacteria and viruses. It can also be used, when people are not present, to generate ozone in the same locations, for a more in-depth odor treatment and cleaning. The range of the Newaire™ HO3 - 2500 is 6,000 square feet.”

She added that a good ozone generator is, and always will be, the best way to deodorize air, surfaces and to reach cracks and crevices. However, limitations in this process occur in areas where people are also present.

“An hydroxyl generator can be used to fill this void for superior air quality. With the Newaire™ HO3 - 2500 Air & Surface Treatment System, Queenaire Technologies now offers two types of odor elimination — ozone and hydroxyl — within the same machine,” Duffy said. “These are complementary technologies.”

Visit ozoneexperts.com or call 1-866-676-9663 for more information.


From Intelligent Design Manufacturing LLC:
The MyHousekeeper Micro Floor Scrubber:
Less Work With Better Results

The MyHousekeeper micro floor scrubber handles any space a traditional mop can, and does a better job of cleaning, according to Intelligent Design Manufacturing LLC.

The scrubber includes an ergonomic handle, locking recovery tank, battery charger port allowing charging without removing battery, 360-degree pivot and comes standard with urethane blades.

The cleaning width of the MyHousekeeper micro floor scrubber is 14 inches and its working capacity is 10,764-square-feet per hour. The brush speed is 180 rpm, brush diameter is 11 inches, and the brush pressure is 28.7 pounds maxs. The machine height is 48.8 inches, weight is 34 pounds with batteries, and its battery voltage is 36v.

Providing commercial cleaning power with ease, the MyHousekeeper micro floor scrubber leaves floors dry after use.

Send email to Leo@IntelligentDesignmfg.com, call 1-833-554-3628,
or visit IntelligentDesignMfg.com for more information.



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| 204 E. Main St., P.O. Box 130 | Arcola, Illinois 61910-0130, USA
(800) 598-8083 (217) 268-4959 Fax: (217) 268-4815 | email: rankinmag@consolidated.net


In the
May/June 2022
print issue
of MSN


SPECIAL
CONTENT:


The Guide
To Green:

Environmentally Friendly Products

SPECIAL
FOCUS ON:


• Maintenance Chemicals


• Dispensers & Proportioners

• Floorcare
Equipment
& Supplies


For further
information,
rankinmag@
consolidated.net



Send News Of Your Company To rankinmag@
consolidated.net