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Published: Monday, 2/6/2006

Supplier offers right tool for the job

BY MARY-BETH McLAUGHLIN
BLADE BUSINESS WRITER

After spending a number of years working at local industrial distributors of tools, Tim McNeeley and Mike Sauppe knew it was a mature industry.

But they were convinced the business could be conducted better and more efficiently, so they decided to get into the business themselves and started Pinnacle Tool & Supply Co. six years ago.

They were the only employees, and they had 15 customers and $800,000 in business, said Mr. McNeeley.

Their instincts seemed to prove accurate. The business now has 10 employees and more than 300 customers and expects revenues this year of $6 million.

The company quickly outgrew its first offices and has taken over the unit next to them at 2620 Centennial Rd. in Sylvania Township. The growth led them to initial discussions with a local developer to build a 12,000 to 15,000-square-foot building on two acres in the township.

"There is still business out there to get," said Mr. Sauppe. "It just depends on who's aggressive to go out and get it."

One way to do that, said Mr. McNeeley, is to go into a plant and do an assessment of the operation, including studying the machinery, and then offer suggestions on what can be changed to make the company more efficient.

"Manufacturers are already getting squeezed by their customers on price, so the question becomes, 'How else can you be innovative?' " said Mr. McNeeley.

Dave Welling, maintenance supervisor at the Fremont facility of the Plastics Group Inc., said a main reason he is a customer of Pinnacle Tool is the inventory system the firm has.

"He came in and physically helped me put the inventory together and then he comes out and monitors that to make sure everything stays at the levels that I dictate," Mr. Welling said. He estimates Mr. Sauppe keeps track of the levels of more than 200 items, ranging from hand tools to saw blades.

A small but growing niche is Pinnacle is industrial vending for machines for tools. Pinnacle sets up a machine on a factory floor and stocks it with tools and parts. Then workers can access the machine on an as-needed basis, using an employee or job code.

The codes allow the company to keep track of who is using what, cutting down on overhead and excess.

It costs about $30,000 for Pinnacle to install the machines and stock them initially, but it allows an entree into companies that may not have used Pinnacle before, the partners said.

"The payback for us is about a year," said Mr. Sauppe, "but it's worth it to get the business. On paper, it's a no-brainer."

Pleased with their machine are the owners of Lockrey Manufacturing in Toledo.

"One of the big benefits of working with Pinnacle is the vending machine. It's like a candy machine," said Matthew Makulinski, process/quality manager. "No one has to monitor it."

But Mr. Makulinski said he also likes Pinnacle for its honest manner. "I put a lot of faith in the Pinnacle guys."

One reason for that trust, the tool firm's owners said, is the employees who have extensive background in industrial tool sales, including sales representatives in Cleveland, Detroit, and Fort Wayne.

"We have good-quality, smart people," said Mr. McNeeley.

"Our next step is to find some newer and younger sales people and train them from the ground up."

Within the first nine months in business, the company received the a touted quality designation ISO 9001-2000.

"We felt we were a pretty good operation, that we were pretty efficient, but that designation gives you credibility," said Mr. McNeeley.

Customers range from General Motors Corp. to eight-main tool and die shops, the partners said, and come from industries as diverse as automotive, plastics, and aerospace.

Plans call for constructing a headquarters and expanding sales territory.

"We want to be more of a regional player," said Mr. McNeeley. "There's so much business out there."

Contact Mary-Beth McLaughlin at: mmclaughlin@theblade.com or 419-724-6199.

Small Business Profile is a weekly feature on local companies. To be considered, send information about your company to Small Business Profiles, Business News, The Blade, P.O. Box 921, Toledo, OH 43697-0921.



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