“Also, all of our products are bar-coded, which allows the trucks and store to keep in contact via a wireless communication and an integrated, web-based customer information database. So the trucks and the store are able to talk to each other in better servicing the customer. Plus, our trucks can service an entire city, they’re not limited to just a designated route.”
Sporting A New Approach
Brian Gale is the president of Beta Distribution USA, the Englewood, CO-based company charged with introducing Beta Tools to the U.S. market. Like Rutherford, Gale was also familiar with Beta from racing motorcycles. A few years back, he found himself in Italy conducting business with a sporting goods company that was close to the Beta factory. He recognized the name and inquired about the brand’s availability in the U.S. From there the domino effect took hold. The Knoxville opening is the fruit of his three-year labor.
As the company grows and opens more locations, the plan is to have these stores act as both regional warehouses, as well as sales and service centers. They will not only cater to walk-up business, but also support a fleet of tool trucks.
The stores will feature demonstration and display areas solely dedicated to Beta’s line, which includes hand tools, power tools, shop equipment, tool storage, work wear and safety shoes. Tying everything together is that web-based, proprietary bar-coded software system that allows for managing inventory in the store and on the truck. Essentially, this new business model provides immediate customer service support and inventory fulfillment.
Beta, based in Italy, is a major tool player in Europe. They see this approach as the best way to enter a U.S. market that they’ve been looking to crack for nearly five years. The company’s roots go back to the early 1880s when Alessandro Ciceri opened a metal forge in northern Italy. The company is still owned by the founding family, and currently works with distributors in over 90 countries.
Beta also supplies Ferrari’s Formula 1 racing team and works with the elite vehicle maker in developing a line of tools and equipment bearing the famous Scuderia Ferrari insignia. Beta is well funded and carries a significant amount of experience in breaking into new markets. Initial plans call for 127 franchised locations throughout the country, with crosshairs firmly fixed on Charlotte and Indianapolis for their next store openings.
With their eyes set on that many stores, distribution becomes a key point of Beta USA’s business plan. Right now everything flows from Italy and through their U.S. location outside of Denver before reaching the store. This warehouse keeps about 8,000 SKUs on hand, while the store stocks about 6,000. Beta offers over 11,000 SKUs.
The U.S. warehouse receives a monthly shipment from Italy, which they will turn around and send to the stores twice a month. If a requested product is not in the store, it will take about six weeks to make the trip from overseas. Once more store fronts are established, Gale would like to see an east coast warehouse constructed.
What really ties everything together is the database that will be accessed and used to share information amongst the headquarters in Denver, every store and each truck. In addition to thorough customer contact information and purchase histories, the database will also provide sales data showing how different products are usually sold in unison with one another, or offer advice, based on company-wide sales trends, relating to possible up-selling opportunities or related product buys.
Everything that’s sold will be tracked and referenced to that customer, regardless of where they travel or move across the country. Additionally, the company offers an incentive program called Beta Collectibles, which allows customers to accumulate points from purchases that can be redeemed on anything from watches to golf gear.
Beta’s experience in breaking into new markets, combined with a business plan that complements both their traditional approach and the U.S. tool truck dynamic should prove interesting to watch. Beta has quality products, a tested methodology and a dynamic support structure. But their approach to the market is new and different, and so is their name to many end-users. That said, their success or failure should depend on the same things that impact any distributor – customer service, product availability and fair pricing.