Electronic components distributor Master Electronics will celebrate its 50th anniversary next year, and the company has much to celebrate. Master ranked 18th in Global Purchasing’s 2016 Top Electronic Components Distributors report, with $183 million in sales, and continues to grow organically as well as by acquisition, acquiring Canada’s Electro Sonic two years ago. Riad Nizam, senior vice president of sales and product, talked about the economy, the importance of employee training and development, and the potential for more acquisitions in a recent interview with Global Purchasing. Here are some excerpts from our conversation:
How is business shaping up in 2016?
Riad Nizam: It’s a challenging market, but we are marching to our strategy. We continue to invest in inventory across our line card. Just recently we reached over 40,000 part numbers in stock for TE Connectivity. We continue to invest in people as well as new technologies and tools to enhance our operations, striving for the best customer experience. We have been partnering with suppliers and customers alike to solve problems. We are up 5% [year-over-year] and we continue to build momentum and outperform the market.
What kind of “people” investments are you making?
Nizam: We haven’t stopped hiring because business is slow, for one thing. This year we created a new role within the company, hiring a talent development specialist last January. We are creating a culture of learning and continuous improvement. We want to train and teach “our way” to set up our sales team for success. I have high hopes for this initiative.
What will be included in the program?
Nizam: Since we are starting from scratch, this will be an evolution as we obtain buy-in from the entire organization. Since onboarding our specialist, we’ve created a training program. Next steps will include creating content and allowing our teams to digest it in-person or as online training. The key is to make it fun, engaging and low pressure. Employees are embracing it more than I thought.
It’s been two years since Master Electronics’ acquisition of Electro Sonic, based in Canada. How is that going, and are you planning any additional acquisitions you can share?
Nizam: As I mentioned last time we spoke, we knew Electro Sonic was a culture fit with our organization. We also knew Electro Sonic had a rich history of servicing the Canadian market for over 60 years. Since the acquisition we have doubled the customer base, launched an e-store, added to the sales team, and appointed a national sales manager. We also opened a distribution center in Toronto, which allows us to carry local inventory for customers. The Canadian economy has not been great since the acquisition, but despite that we are still up nine percent this year.
We completed 13 acquisitions in 15 years. I’d be surprised if we didn’t accomplish another within the next 12 months.
What are some of the greatest challenges your company is facing in today’s market?
Nizam: In a down market we are challenged by margin erosion. We are also challenged by customers’ inability to make commitments. Nonetheless, every challenge is truly an opportunity for Master. We are adding more parts to stock than ever before, adding quality people to our team, and working with customers to understand their problems and solve them. Becoming a true partner to our customers and suppliers will be key to our success. Asking “What are your problems?” is our motto these days. Defining a problem is one thing, but we feel if anyone can solve a problem, it’s us. On the supplier front—we are adding suppliers to our line card at a quicker pace than usual, which allows us to offer more products and solutions to our 75,000-plus customers.
Riad Nizam is senior vice president of sales and product at Master Electronics, which ranked 18th in Global Purchasing’s 2016 Top Electronic Components Distributors report with $183 million in sales.