Purchasing Co-op Saves Dealers Money and Time
By Donna Kreutz
“I got into this business through a fluke,” said Nicole Reisdorfer. Fresh out of college, she applied for a job with Allied Purchasing Company in Mason City, IA when the nonprofit co-op was starting up the Culligan division to serve the water treatment industry. “It was a natural fit because I already knew a lot about Culligan,” she said. “At the time, I was married to a Culligan Man.”
That was in 2002 and until recently she was Senior Account Manager for the Culligan division that, along with another water treatment division, served an estimated 1,000 independent dealers in all 50 states and Canada. She was just promoted to Director of Sales and Marketing and oversees both those divisions, as well as the dairy, beverage and brewery divisions.
It’s Reisdorfer’s job to introduce small and mid-sized dealers to the benefits of joining the industry’s only not-for-profit purchasing cooperative. “There are other national co-ops in different industries but we are the only one for water conditioning.” Many dealers don’t realize the benefits a co-op provides, she said. They can save time and money all year long, be connected to a virtual warehouse packed with an array of products they use, receive pre-negotiated pricing discounts and have everything delivered to their door with just one place to pay. “It’s one-stop shopping,” she said. And it’s personalized. “We do a lot of one-on-one with our dealers. We have such a wide variety of products that our members call and email us frequently, creating a great relationship and friendship between our employees and the dealers we serve, as well as the suppliers we work with on a daily basis.
“Allied has a strong focus on customer service with account managers who are well-versed in pricing products, placing orders and solving customer service issues, such as freight problems. Our members know when they call they will always get a live person to help them find products with the best prices, quality and customer service possible. Our suppliers like working with us and train us on their different products so we can help dealers make informed decisions.”
Lower costs for everyone
“We are able to negotiate lower costs for everyone by combining the purchasing volume of all the members in the same industry. Negotiated discounts vary by product and can range from one or two percent up to 10, even 15 percent. Across the company we work with about 500 suppliers. We have probably about 200 in water conditioning and treatment products. Our best-selling water treatment products are salt, RO systems, pumps, filters/housings, membranes and coolers. We don’t actually stock anything; we drop-ship from the manufacturer to the dealer.
“We’ve been growing very fast the last five years. We attend all the Culligan shows. We work with a lot of new water conditioning companies, attend regional and national meetings (including the International Bottled Water Association and the Water Quality Association) as well as education sessions to find out what’s going on in the industry, including innovations, changing regulations and what’s going on legislatively. We post articles on our website and in our email newsletters to help keep people informed. We keep paperwork on hand so we can help with US Food & Drug Administration (FDA) audits and assure that the materials purchased are compliant. Our members do not have to get this information from each individual supplier.”
Allied members pay a one-time fee of $50 for a share of stock and an upcharge of roughly two percent of the purchase total to cover internal costs. Because Allied is member-owned, any profits at the end of the year are rolled forward into the operation. To be eligible, a dealer must be in business for at least two years, provide credit information and references and have projected annual sales of $250,000 or more.
Steady growth since 1937
Allied Purchasing’s roots date back to the Great Depression, when a small group of independent dairies in Iowa came together to form the first successful buying group of its kind in 1937. “One of the original members also owned a beverage company, so that led us into the beverage industry. In the late ’80s, the bottled-water boom started and with many of our members being in the beverage industry, that led to bottled water. Once we started down that path, the natural progression was into water treatment since many suppliers and members handled both those lines of business.” Allied added the Culligan division in 2001. Reisdorfer was hired a year later and soon headed the new division. (Already serving wineries, Allied is now expanding into craft beers. The company will celebrate its 80th anniversary next year.)
“There are so many dealers out there who do not know we exist. We’re targeting the small to mid-range companies that might not get to regional and national shows and do not have a voice or access to price discounts. We are continuing to grow our water treatment division with new suppliers and members. We are making it easier to find products through our large catalog online and continuing to grow that segment of our company. We see so much opportunity.”
This busy mother of four children (ranging from three to 18) is a graduate of Buena Vista University in Storm Lake, IA, where she double-majored in history and business. Her job requires a lot of travel, so she’s become a master at juggling priorities. “I love what I do. I love the people I get to know. And I love knowing that I’m helping dealers improve their bottom line.”