LONESTAR IN THE NEWS
Roadmap for Growth
10/1/2019
Stop and think for a moment about the last time someone in your market area started up a new electrical distributor.
Can’t think of anyone? You are not alone. They are tough to find. But if Texas is your market, you probably have a very quick answer: Lonestar Electric Supply, Houston, TX, which has grown in rather spectacular fashion since starting up just four years ago. Now ranked #57 on EW’s Top 200 listing with $167 million in 2018 revenues, Jeff Metzler, Lonestar Electric Supply’s CEO, expects the five-location company to hit $240 million in sales in 2019 from electrical contractors in Houston, Dallas, Fort Worth, Austin and San Antonio — an annual increase of about 44%. An amazing footnote to this growth is that Lonestar may hit that level of sales without a switchgear line or being invited to join one of the electrical market’s two largest buying/marketing groups, Affiliated Distributors, Wayne, PA, or IMARK, Bowie, MD.
Lonestar’s launch goes back to a meeting Jason Vaughn, president of the company’s Houston operations, and Neil Clay, president of its Dallas market operations, had in Metzler’s game room four years ago. The three men, along with industry veteran Craig Levering on the phone, agreed to utilize their 100-plus years of combined experience in the Texas market working for both national and independent electrical distributors to launch Lonestar Electric Supply. A graduate of the Texas A&M University School of Industrial Distribution and a long-time student of the distribution game (his family was in the bearings distributor business), Metzler previously worked for Summers Electric Supply before and after it was bought by Rexel, and Crawford Electric Supply, before and after it was acquired by Sonepar. A graduate of Louisiana State University (LSU), Vaughn worked for Graybar and Crawford before Lonestar. Clay, another Texas A&M graduate, worked at Summit Electric Supply, Crawford and Sonepar before joining Lonestar.
They had some financial backing from Levering, who built Crawford Electric Supply into one of Texas’ larger distributors before selling it to Sonepar in 2007, and former Major League Baseball All-Star Andy Pettitte. And they had some sage advice from Joe Jones, a legendary Texas distribution executive who sits on the Lonestar board of directors. With these resources, Metzler, Vaughn, Clay and the Lonestar team developed a package of project management, logistical support, education and lighting design services to help electrical contractors win more commercial lighting projects.
Lonestar’s executive team says some of their initial ideas for growing the business didn’t pan out because they had neglected an important element in their planning process — asking customers what they needed from a distributor and what types of products and services would differentiate from the many national, regional and local electrical distributors already serving the Texas market.
As Jason Vaughn explains it, “We realized early on that we might not get a gear line and that it would put us at a competitive disadvantage. We created a think tank group to come up with ideas to add value to contractors to differentiate ourselves. We did the big meetings with whiteboard ideas, but when we went to contractors and told them what we were going to do for them, they said, ‘We don’t need that.’ And we said ‘Uh-oh, that’s not good.’
“Somebody said, ‘Why don’t we ask the contractors what they want us to do?’ We asked the basic question: ‘Mr. Customer, what is it that you would like distribution to do for you?’”
“We went back to the whiteboard and figured out what we could do profitably,” says Metzler. “We developed strategies around what the customers asked us to do. It’s been a game changer for us. Along with hiring great people, that’s the reason we have been able to grow so fast.”
Vaughn and Metzler said the Lonestar team and the sales veterans with strong contractor relationships that they hired met face-to-face with owners of Texas electrical contractors and asked them several basic questions:
• What’s costly for you?
• What’s critical to you?
• How can we add value to your business, not only financially but also from a time-constraint position?
• What can we do to make your business better?
• How can I help you save money?
• How can I help you build your jobs more effectively?
Roadmap for Growth
10/1/2019
Stop and think for a moment about the last time someone in your market area started up a new electrical distributor.
Can’t think of anyone? You are not alone. They are tough to find. But if Texas is your market, you probably have a very quick answer: Lonestar Electric Supply, Houston, TX, which has grown in rather spectacular fashion since starting up just four years ago. Now ranked #57 on EW’s Top 200 listing with $167 million in 2018 revenues, Jeff Metzler, Lonestar Electric Supply’s CEO, expects the five-location company to hit $240 million in sales in 2019 from electrical contractors in Houston, Dallas, Fort Worth, Austin and San Antonio — an annual increase of about 44%. An amazing footnote to this growth is that Lonestar may hit that level of sales without a switchgear line or being invited to join one of the electrical market’s two largest buying/marketing groups, Affiliated Distributors, Wayne, PA, or IMARK, Bowie, MD.
Lonestar’s launch goes back to a meeting Jason Vaughn, president of the company’s Houston operations, and Neil Clay, president of its Dallas market operations, had in Metzler’s game room four years ago. The three men, along with industry veteran Craig Levering on the phone, agreed to utilize their 100-plus years of combined experience in the Texas market working for both national and independent electrical distributors to launch Lonestar Electric Supply. A graduate of the Texas A&M University School of Industrial Distribution and a long-time student of the distribution game (his family was in the bearings distributor business), Metzler previously worked for Summers Electric Supply before and after it was bought by Rexel, and Crawford Electric Supply, before and after it was acquired by Sonepar. A graduate of Louisiana State University (LSU), Vaughn worked for Graybar and Crawford before Lonestar. Clay, another Texas A&M graduate, worked at Summit Electric Supply, Crawford and Sonepar before joining Lonestar.
They had some financial backing from Levering, who built Crawford Electric Supply into one of Texas’ larger distributors before selling it to Sonepar in 2007, and former Major League Baseball All-Star Andy Pettitte. And they had some sage advice from Joe Jones, a legendary Texas distribution executive who sits on the Lonestar board of directors. With these resources, Metzler, Vaughn, Clay and the Lonestar team developed a package of project management, logistical support, education and lighting design services to help electrical contractors win more commercial lighting projects.
Lonestar’s executive team says some of their initial ideas for growing the business didn’t pan out because they had neglected an important element in their planning process — asking customers what they needed from a distributor and what types of products and services would differentiate from the many national, regional and local electrical distributors already serving the Texas market.
As Jason Vaughn explains it, “We realized early on that we might not get a gear line and that it would put us at a competitive disadvantage. We created a think tank group to come up with ideas to add value to contractors to differentiate ourselves. We did the big meetings with whiteboard ideas, but when we went to contractors and told them what we were going to do for them, they said, ‘We don’t need that.’ And we said ‘Uh-oh, that’s not good.’
“Somebody said, ‘Why don’t we ask the contractors what they want us to do?’ We asked the basic question: ‘Mr. Customer, what is it that you would like distribution to do for you?’”
“We went back to the whiteboard and figured out what we could do profitably,” says Metzler. “We developed strategies around what the customers asked us to do. It’s been a game changer for us. Along with hiring great people, that’s the reason we have been able to grow so fast.”
Vaughn and Metzler said the Lonestar team and the sales veterans with strong contractor relationships that they hired met face-to-face with owners of Texas electrical contractors and asked them several basic questions:
• What’s costly for you?
• What’s critical to you?
• How can we add value to your business, not only financially but also from a time-constraint position?
• What can we do to make your business better?
• How can I help you save money?
• How can I help you build your jobs more effectively?