Born on a Reel: A-Z Wire and Cable

By Mike DeFilippo

Jim Anixter is literally and figuratively wired.

The 69 year-old President and CEO of A-Z Wire and Cable delivers non-stop conversation while he zips around mountains of cable in his company’s 100,000 square foot corporate headquarters via golf cart.

Topics range from family, the wire business and his beloved Chicago Cubs, then circles back to the family business and the company founded by his father Alan and Uncle Bill.

“My father and uncle started on the manufacturing side of the business working for American Insulated Wire (AIW) They learned the business and saw a need for specialty cables and value added services. My grandmother Zelda leant them $20,000 and they started a wire and cable distribution business in 1956.

The company he refers to is Anixter International– a multi-billion dollar publicly traded Fortune 500 Company with locations in over fifty countries.  Jim joined the business in 1966. The Anixters grew their family business into the largest wire and cable distributor in the world. Anixter was sold in 1986. Two years later Jim left to start A-Z Industries with his partner Bob Zywicki.

Like his father and uncle before him, Jim saw an opportunity in providing the electrical distributor and wire and cable specialist with hard to find items normally associated with higher manufacturer minimums and low inventory turns. Utilizing their relationships with the wire and cable manufacturers, the partners started A-Z as buyers of special constructions, overstocks and discontinued items. The company experienced modest growth for its first ten years of operation. Things changed as Jim Anixter’s three sons graduated college and decided to join the business.

“I am the oldest of four siblings who grew up in wire and cable and we all were interested in the business, so we had to grow. I knew we weren’t going to grow selling special constructions and slow movers,” said Executive Vice President Darren Anixter.  We might hit on a good deal and make money on a flip, but there was no way to guarantee growth and feed everyone’s interest with that model.”

The Next Generation
The Anixters have the family business hardwired into their DNA. According to Jim Anixter, they were “born on a reel.”

Each Anixter brother—Darren, Todd and Eric—has the title of Executive Vice President. The three brothers purchase all of the wire and cable stocked in the company’s five distribution centers.

“We each handle different product categories,” explains Darren Anixter.  “I manage the heavy mining, welding and single end power cable like DLO, Entertainment and jumper cable. Todd manages all of the building wire, aluminum building wire and tray cable. Eric is responsible for the portable cords, control and electronic cables. We all handle certain accounts, but we are all interchangeable.”

In a business tied to the volatile price of copper—where margins can expand or shrink in a flash—the more brains the better.

“We know exactly where copper is at any given moment at the day. We manage our inventory turns well,” said Eric Anixter.

“The most important part of our business is our purchasing,” said Darren Anixter. “We have to be really smart.  A lot of people buy this stuff, so we have to be good at it.”

Todd Anixter agrees with his brother.

“By dividing up purchasing we are all in the trenches. We can share information and better understand the market,” said Todd Anixter.

Initially purchasing and sales was a free-for-all where each person bought and sold what they needed. Recognizing the need for a structure, the brothers divided up the products and clients based on their strengths and interests. As some customers might have needs for a variety of types of wire the three often find themselves collaborating on a project.

The “boys” are also heavily involved on the sales side.

“We used to account for 80% of the company’s total sales,” said Todd Anixter. “Thankfully that number is down to 40% today and shrinking. We still handle a lot of the big customers, but today we employ 20 inside and outside sales people across the country. This is better for our customers and for company growth.”

Two calls for quotes ring in to Darren Anixter’s desk during the few minutes of this interview. He excuses himself to take each call, then proceeds to quote price information without referring to his computer. This leads to the question—”Do you have wire on the brain?”

“There is a size of cable we sell called 535 DLO. Sometimes when I look at my clock it will be 5:35 and it triggers the “DLO” response in my brain. I am in too deep,” said Darren Anixter. “But it allows me to be that much more responsive.”

Each brother has a similar story about the pervasive nature of his business.

“We are lifers. When I see a truck on a highway carrying wire, I wonder whose product is on the back and where it is going. During my first ten years on the job I vowed never to take it home with me, but now with text and e-mail, you can’t get away from it,” said Todd Anixter.

Eric Anixter admits that he too is not good at shutting things down when he leaves the office.

“I think about all aspects of the business and the ways we can grow and expand what we have started,” says Eric. “We are always looking at ways to add value to our products and service and to streamline our process to add value for our customers.”

The company currently specializes in eight product groups, but acknowledges there are thousands of different possible product offerings that fall under the heading of “wire and cable”.  Their customer base is comprised of electrical distributors and their own competitors.

“The reason people do business with us is that we are very accessible. We are a service-oriented company. Our main focus is to sell to electrical distributors and let them worry about collecting from contractors,” said Jim Anixter.

“We are still buying items that other people in the market consider B, C and D items,” said Darren Anixter. “But that is how we fit, we blend and complete our customers’ wire and cable inventories.”

“The message we try to get out to our customers and potential customers is this—if you are an electrical distributor and 20% of your budget is for wire and cable, reduce that spend and copper risk to 10% and work with us on the balance. One hundred percent of our budget is wire and cable and the labor and overhead to provide value to the product. Utilize our product, labor and space,” said Eric Anixter.

Currently, A-Z’s strategy for growth and expansion is geographic. Since the three brothers have taken the reins of the business, the company has expanded from its base in Northbrook, IL by adding four 30,000 square foot sales and distribution centers in Houston, Phoenix, Charlotte and Denver, and a sales office in Tampa. It stocks $20 million in inventory across these locations.

“Our warehouses are set up with the goal of making same day shipment in all of the major domestic markets, and one day away from everywhere in the US,” said Darren Anixter.

Additional locations in the Northeast, Midwest and West Coast are on the company’s wish list for future expansion. Canada also provides a market for the company to expand. But growth will be incremental, not explosive.

If not for the presence of sister Courtney Anixter, the family business would be a true boy’s club. She received her master’s degree in Education and taught school for a year, working part time at the company. When a full-time spot opened in the accounts payable department, she decided to fill it.  She has no desire to move into the wire side, preferring to deal with the financials.  Her business partners appreciate having a family member keeping an eye on the till.

“I enjoy working with my family. My father is very much a character. He is a happy person, full of life and energy. He really cares about the people here,” she said.

Although Courtney Anixter is the only girl in the family, her department is staffed entirely by women, four of whom are two sets of sisters. The Anixter family likes having other families in their employ. “We try to create an environment where our employees enjoy working here,” said Courtney Anixter. “It is an old school way of doing things, and my father embraces that.”

Rebranding
One of the ongoing challenges A-Z Wire and Cable faces is its image in the marketplace. The company has moved well beyond its roots as a buyer and seller of over stock, odd lots and slow moving inventory, but some potential customers still make that association.

The new generation of Anixters running the company have made it their mission to overcome the image of an odd lot outfit, and in all minds but their own, they seem to be winning the battle.

“When our father started the company it was a different time. Manufacturers were less efficient, so there was a need to buy close outs and slow movers and find a way to put them back in the market,” said Todd Anixter. “When my brothers and I started here, we realized we needed growth opportunities, and we started to take to heart what our customers really wanted – which was to get standard material from us quicker than from a factory because factories deal with lead times and production schedules.”

A-Z’s management began to position itself as a mainstream wire and cable specialist that serves as an arm to distribution. When the company started, its business mix was 80% B, C and D items or slow movers and 20% from the A items or most common wire and cable products. Today that ratio has changed, with about 70% of its sales coming from standard items and 30% from the slow movers.

The company attracts its customers by stocking $20million of cable inventory and keeps them with unparalleled service, value and speed.  Company-wide there are 20 cutting machines ready to tackle custom orders.

“Once we let people know what we do and our inventory, we usually get inquiries, then we get orders,” said Darren Anixter. “Once we get orders then we have a relationship. Relationships lead to long term partners.”

The company keeps a lot of heavier product in stock that electrical distributors, or other wire and cable specialists, would not normally carry.  A-Z currently has over a mile of 2Kv mining cable in stock as an example of the depth of inventory.

“We made an advantageous deal on it. We could probably sell it cheaper than the factory can manufacture it, but we would not do that because we don’t break markets,” said Darren Anixter.

His father chimes in with an example of the level of service the company offers to its customers.

“One of our customers gave us a great opportunity to perform 10,000 cuts on heavy material with a time constraint,” said Jim Anixter.  “Not many people could have handled that job with that window.”

A company that deals in a commodity item on a business to business level has to wage its rebranding campaign one small skirmish at a time. Recently Jason Anixter, son of Anixter Wire co-founder Bill Anixter and nephew to Jim Anixter joined A-Z Wire and Cable as an outside salesman. Though he ran a restaurant for decades, he says the business is “in my blood.”

Under the tutelage of veteran salesman Bernie Rosenblum, Jason Anixter has been introducing new customers to the A-Z brand through direct contact. Ultimately, face-to-face meetings have been the most effective way for A-Z to get its message across.

“The Anixter name opens doors. Once we get an opportunity we do a good job,” said Jason Anixter. “When we explain to them the segments where we are strong and how we fit in with their business we get an order and do a good job of holding on to customers.”

In Jason Anixter’s estimation, the rebranding efforts are working.

“In all the calls I make, I never hear anyone refer to us as an odd lot house,” he said.

At 75 years old, Bernie Rosenblum is something of an industry legend. He is effusive in expressing his zest for the action of wire sales and customer service.

“We give them what they need, help them engineer it and perform the service of giving them the product they need when they need it,” said Rosenblum.

A client visit to the company’s Northbrook, IL facility convinces any skeptic that this is a full scale, full service operation.

“Once they see what is on our floor the perception of us changes immediately,” said Jim Anixter. “We have had some national chains visit us and see all the bulk standard reels we have in house and their mouths drop.”

Diehard Cubs Fan
A highlight of a visit to the company’s headquarters is a trip to the conference room. This space is a shrine to Jim Anixter’s love for the hometown Chicago Cubs. In addition to his reputation in the wire and cable industry, Anixter is known as a die-hard Cubs fan. He can be spotted in his seats behind home plate at Wrigley Field wearing his distinctive pink hat. Known as “The Pink Hat Guy”, Anixter uses the hats to raise money and awareness for pancreatic cancer, a lethal disease that claimed his brother.

In addition to the ivy and photos on the walls, authentic seats, turnstile and on-deck circle from Wrigley Field, the conference room features a miniature model of Wrigley Field set behind a carpet designed like a major league infield.

“When we bring customers in here it takes the edge off,” said Anixter.

Jim Anixter’s passion for baseball and passion for business converge in this analogy that he has applied to his own operation.

“Running a company is like running a baseball team,’ said the founder of A-Z Wire and Cable. “You get the right people in the right positions, you pay them well, you build loyalty, and you win.”

Old School to the Max
Jim Anixter refers to himself and some of his colleagues as the “Geriatric Division” of A-Z Wire and Cable. He will hit 70 in October 2014. The title of Senior Outside Salesman is not taken lightly by 75 year-old Bernie Rosenblum.  Ray Geraci, former radio voice of the Chicago and Saint Louis Football Cardinals, is the 85-year old marketing and media professional who handles the company’s advertising. Bill Anixter serves as Chairman of the Board. He recently received a hand written letter from the Secretary of the Army congratulating him on his 90th birthday and thanking him for his service in WWII during the Normandy Invasion.

But all these men are mere pups alongside Max Fabian. The 105 year old recently retired from A-Z at age 102. He started working for the Anixter family in the 1930’s as a security guard and chauffeur for Jules Anixter. He continued in this position when Alan and Bill Anixter founded their eponymous wire business in 1956, then joined Jim Anixter at A-Z Wire and Cable.

The words of Bill Anixter – founder of Anixter Wire and Cable with his brother Alan, father to Jason, uncle to Jim, and great uncle to Darren, Todd, Eric and Courtney Anixter  – provide a fitting testimony to the company’s success.

“We are very experienced, and we care,” said Bill Anixter.

 

Tagged with tED