After nearly 70 years, Baxter-Rutherford Inc. stays strong by focusing on more than one market. “When one segment is up, the other might not be,” President Rob Norwood Sr. explains. “But when they’re both up, it’s a beautiful thing.”
Based in Seattle, the manufacturer’s representative markets products through its Pipe-Valve-Fitting division and its Industrial-Construction-Fastener division. “We’re finding [business for] them both to be up right now,” Norwood Sr. reports.
Founder Bruce P. Rutherford started the company in 1947, and entered a partnership with Ed Baxter in 1965. Rutherford later left the business and Baxter died in 1969, leaving Dennis Seger as the company’s owner.
When Norwood Sr. went to work for Seger in 1971, Baxter-Rutherford had a very small operation. “Back then, we started out with just Dennis, myself and a part-time warehouse man,” he recalls.
However, the company grew by diversifying its product lines. “We just built on each segment of our business,” Norwood Sr. recalls, noting that he bought the company from Seger in 1977.
Today, Baxter-Rutherford represents 30 different product lines. “They’re evenly split between the [two divisions],” he says. “We represent all of these manufacturers on an exclusive basis. We are a bit of a hybrid operation in that we work on both manufacturers’ commissions, whereby the manufacturer invoices the distributor, and we also do some invoicing for the product that we own.”
Covering the Bases
Baxter-Rutherford conducts business in the sales territory of Oregon, Washington, Idaho and Alaska. Geographically, Oregon, Washington and Idaho expand roughly 245,000 square miles. Add to that the state of Alaska, which covers more than half a million square miles.
“While the metropolitan areas often drive the largest sales volume, our diversity has enabled us to establish and maintain meaningful relationships across the entire territory,” says Rob Norwood Jr., vice president and Norwood Sr.’s son. “Our diversity of products allows us the consistency of coverage that puts us where we need to be when the opportunity arises.”
Location, Location, Location
Baxter-Rutherford operates from two warehouses in Seattle and Vancouver, Wash., that together total 70,000 square feet. “Both have locations that are key to some of our success,” Norwood Jr. says.
The Seattle facility is adjacent to Interstate 5 and Boeing Field. “We’re in the industrial part of the city,” Norwood Sr. says. “It has benefited us greatly.”
“Many of our customers are here every day,” Norwood Jr. adds. “Our Vancouver facility is in a similarly strategic location, right off of Interstates 5 and 205, allowing us to conveniently serve the Portland market as well.”
Baxter-Rutherford recently grew its operational footprint with the purchase of a building next to its Seattle warehouse. Although property and land tends to be extremely expensive, “We were in a position to buy when it became available,” Norwood Sr. explains.
The purchase includes a 6,000-square-foot warehouse and a relatively large yard. “It will give us room for additional expansion,” he says.
Baxter-Rutherford does not sell directly to contractors, but within the last several years, has hired new associates that are focused on engaging with them, Norwood Jr. says. The company created the roles of “contractor specialists” who not only introduce new products and provide local support to the contractor but also solicit a better understanding of the preferences and priorities behind the sale of any given product group.
“We have people on board that strictly expose our product to the contractor and let them know the features and benefits they might not have been exposed to in the past,” he continues. “We get their attention that way.”
Since implementing the new roles, Baxter-Rutherford has seen a “tremendous” increase in sales, he says. Previously, “It was difficult to do justice to the contractor with the resources we had at the time,” he recalls. “We’re now out there in front of the contractor and engineers, as many of the products need to be approved before the contractor will buy them.”
A Good Mix
The Norwoods also credit Baxter-Rutherford’s success to its staff, which carries more than 200 years of combined industry experience and maintains a low-turnover rate. “Three-fourths of the staff have more than 10 years with us,” Norwood Jr. explains, noting that some workers have 20 to more than 40 years with the operation.
“We’re kind of a mix of veterans and younger folks,” Norwood Sr. says. “But even the younger folks have tenured with us for a number of years.”
These associates have helped nurture a team-focused culture at Baxter-Rutherford. “We don’t have lines of demarcation where one group of people in our company is any better than another group of people,” Norwood Sr. says.
“Everybody is on the same team,” he continues, noting that its employees look out for the welfare of each other and our company. “I think they find it to be a focused, fair and enjoyable place to work. They see a good future here.”
This also has promoted strong ethics, particularly when dealing with the clients. “We’re upfront with the issues that we’re facing,” Norwood Jr. says. “We put ourselves in the manufacturers’ shoes and the customers’ shoes.”
Norwood Sr. agrees that this approach works best.
“I ask each of our sales staff to imagine this is your business,” he says. “After all, the decisions you make effect everyone in our organization.”
Norwood Jr. is proud of the success his father has had with Baxter-Rutherford. “It’s enabled me to learn a lot from him and see the world a little differently,” he says, noting that many hold his father in a high regard.
Norwood Sr. predicts more changes ahead for Baxter-Rutherford. “Everything is happening at a warp speed, with policies changing with manufacturers, conglomerations of manufacturers, distributors and national accounts,” he says.
“Fortunately, we’re nimble and quick enough that we’ve adapted quite well to the changes,” he says.
The company also maintains a conservative approach to business, Norwood Sr. asserts. “We don’t go out and stand at the edge of a cliff,” he says. “We try to make solid business decisions that don’t put our future in jeopardy with a high risk gamble.”
This has allowed Baxter-Rutherford to be blessed with a lack of debt. “We own our own inventory, we own our own buildings and we’re not paying interest out there to some bank that could cause a problem at some point in time,” he says. “We’ll take a gamble every now and again, but not before we do our due diligence.”
Currently, Baxter-Rutherford is in the process of implementing new business software that will go live in the first quarter of 2016. “In upgrading to the most current version of Epicor’s Profit 21 software, we’re hoping to streamline many of our daily operational functions,” Norwood Jr. says.
“Basically, we’re always watching out for ways to run the business as efficiently as possible,” he continues. “In this case, the investment to upgrade made sense.”