DistributionNOW is one of the largest distributors to the energy and industrial sectors. With more than 5,000 employees and greater than 300 locations worldwide, the company stocks and sells a comprehensive offering of products for upstream, midstream and downstream operations, as well as for industrial market segments.
The Houston-based company offers more than 300,000 SKUs around the globe, including pipe, valves and valve automation, fittings, instrumentation, mill and industrial supplies, tools, safety supplies, electrical products, artificial lift, drilling and production equipment, fabricated equipment and industrial paints and coatings.
“We are one of the largest providers of products and supply chain services to the oil and gas markets. We offer a full range of MRO and PVF products, but also couple the products with services that help our customers reduce their supply chain costs,” say Brad Wise, VP Marketing.
As a defining element of DistributionNOW’s ISO 9001-certified quality management system, its supplier evaluation program is industry-recognized for its focus on ensuring product quality through daily inspections, quarterly enhanced inspections and supplier quality audits. “DistributionNOW audits its supply base thoroughly, including inspections of manufacturing sites, inbound product and supplier reporting and scorecarding,” Wise says.
The company says its approved manufacturers list is one of its most powerful benefits to customers. Some customers have chosen to adopt it as their own, and others collaborate directly to develop their list. DistributionNOW also offers supply chain solutions, such as procurement, inventory, warehouse management logistics, safety and turnaround support services, project management, and business process and performance metrics reporting.
Pipes, valves and fittings (PVF) are among its top sellers, the company says. Its huge inventory bodes well for DistributionNOW, as many in the energy industry are seeking to minimize and consolidate their supplier base. “That is a strong value proposition,” Wise says. “We are there to represent the brand name as a top-tier supplier in the industry and we provide that product at point of sale.”
Each of the DistributionNOW’s more than 300 locations stocks local inventory, which can be shipped or picked up. Wise says the depth and breadth of the company’s inventory is a major competitive advantage. It operates locations in more than 20 nations, with about 68 percent of its business in the United States, 18 percent in Canada, and 14 percent international.
DistributionNOW’s locations have flexible operating models. They are strategically located, including some at customer compounds and worksites. Others are located nearby at separate offices with inventory warehouses.
DistributionNOW was the distribution arm of National Oilwell Varco Inc. in June 2014. National Oilwell Varco is the top U.S. provider of oil and gas components, generating $22.9 billion in annual revenue. The Houston-based company employs 64,000 and is ranked No. 131 on the Fortune 500.
“The third quarter of 2014 marked DistributionNOW’s first full quarter as a stand-alone public entity,” president and CEO Robert Workman said in a recent statement. “We delivered strong sequential sales growth, emerging from a disruptive second quarter where we had completed a spinoff, expanded our ERP platform globally and continued the integration process for three large distribution businesses.
“In the [third] quarter, we completed the corporate structure build-out required to support DNOW as a stand-alone company, which limited incremental operating margins in the period. Our healthy balance sheet, our experienced management team and employees help position our company well to respond to any market conditions.”
Supply Chain Services
DistributionNOW’s supply chain services group provides inventory management, industrial vending and warehouse management services. “Beyond just quality products, DistributionNOW offers a wide range of supply chain solutions to reduce customer costs and increase efficiency,” the company says. “We are committed to meeting customer expectations while delivering value through reduction in capital employed, through decreased total cost of products and operations and through improvements in process efficiency.”
The company notes that it supports its products and services “with accurate, timely and powerful analytics, allowing our customers to monitor the performance of their suppliers, carriers, customers and employees from a central dashboard interface. We work with our customers to determine the key performance indicators that most effectively support the objectives of our relationship.”
The company excels at this with excellent customer service provided by knowledgeable supply chain professionals, Wise says. “[They] have deep knowledge of products, understand what the customer is looking for, and provide that.”
DistributionNOW’s customer service is all the more critical given the nature of the company’s business. When customers are looking for a product, it is often tied to daily market conditions. “In the upstream environment, time is critical,” Wise says. “You have to have the inventory in place and respond to requests immediately as they come in.”
Because of these demands on customer service, recruitment is a top challenge. Oftentimes, it is difficult to recruit qualified professionals, especially for positions located in remote drilling spots. DistributionNOW’s supply chain team seeks professionals with warehouse, inventory management, inside sales, outside sales and customer service backgrounds, Wise says. “In general, we are always looking for good, experienced professionals in customer service and supply chain management.”
DistributionNOW’s wide variety of product categories include:
- Artificial lift
- Drilling products
- Fittings, flanges, gaskets and fasteners
- Mill and industrial supplies
- Paint and coatings
- Pipe and tubing
- Power transmission
- Production equipment
- Regional products
- Safety and PPE
- Valve actuation and automation