Celebrating its seventh consecutive record year, this organization has grown far beyond its roots as a jan/san buying group.
- By Jerry Laws
- Jun 01, 2011
You can't call AFFLINK a buying group, because that description became inaccurate about seven years ago. As President/CEO Dennis Riffer discusses the Tuscaloosa, Ala.-based company's transformation, it also becomes apparent that the pace of change at AFFLINK continues to accelerate.
Riffer spent more than 25 years working for Kimberly-Clark and Scott Paper before joining AFFLINK.
"Afflink's probably one of the most complex businesses you could try to get your arms totally around," he said during a recent interview. “It started out 34 years ago as a buying group and in the last five to seven years has totally transferred over to be a true sales- and marketing-driven organization. We today primarily focus on the key global accounts that we do business with within the end market segments of the safety business, the jan/san business, packaging, MRO, and office products. We're kind of a unique organization where we can surround that end user and truly provide the most innovative solutions within those specific segments of the marketplace, and that's how we really differentiate ourselves."
AFFLINK's mission is growing top-line revenue and providing new business to these key global accounts. Its 110 employees are doing that through a growing suite of business services. As a result, AFFLINK has reached $7 billion in annual revenue, Riffer said.
"Where we are today, we won't even look like this five years from now," he added. "Basically, all of this change has happened, really, in the last seven years. Our members' and suppliers' revenues have grown at a double-digit clip during that period, even with the economic downturn. We'll celebrate our seventh [consecutive] record year. Today we have over 335 independent distributors who are part of our organization. We have over 250 of the best key preferred suppliers. We try to be that link that really brings it all together."
The organization's largest end market is health care. Building services is "an enormous end market segment for us," Riffer said. AFFLINK has an MRO division, hospitality and food service businesses, and a big presence in packaging, where it helps companies remove cost and improve sustainability. "Manufacturing's probably our best footprint, where we can really surround that end user with all of our different entries," he said.
Riffer agreed there is a major opportunity for his organization in the trend of end users' consolidating their sources of supply. "That's our biggest opportunity," he said. "Companies are truly for the first time being able to capture the cost of their procurement."
Technology and Consulting Offerings
AFFLINK had just released a new diagnostic tool named elev8™ when the interview took place March 29. Developing and producing the tool's first phase lasted two years at a cost of $2 million; Riffer predicted it will take three years to finalize all of elev8™.
"We're able to go into these top customers' [facilities] today and go through this diagnostic process that measures where they are today and where we can take them," he explained. "It allows them to quantify their total cost: It takes a look at the procurement cost, the application cost, the acquisition cost -- all of these factors to spit out the best overall total cost. And then we're able to show the productivity improvements and what those look like in the different use areas."
AFFLINK then can offer the customers sustainability, occupational health, and wellness suggestions, which is where AFFLINK comes in as a third-party consultant. (Riffer termed the AFFLINK offering "creative consulting," which includes corporate wellness training. A unit named AFFLINK Academy works on warehouse management, consultative selling, logistics, etc., and an events and exhibits division operates from a 40,000-square-foot warehouse stocked with exhibition supplies. The SafetyLink division created seven years ago is just now coming into its own, he said.)
Most customers don't have deep visibility into their procurement of MRO and other supplies. The elev8™ tool gives them a template to walk through their facilities and create it. Then, they can carry this picture of procurement savings up to senior management as powerful evidence of the savings that can result from changing their processes, Riffer said.
He said the early response to elev8™ was extremely positive. "I've never heard of anybody in the safety industry having anything like this. For the first time, we're able to bring this into the safety industry and, quite honestly, this is a huge home run for us because we are finally able to quantify this," he said.
Riffer said AFFLINK's growth made elev8™ possible because the development cost wasn't being borne by just one unit, such as SafetyLink. And it is just one of the technology benefits the AFFLINK Business Services Division brings to the table. State-of-the-art dashboards show members where they're spending and where their margins are. Forecasting tools are made available. "We can put our customers online overnight and integrate them into an online catalog. We post their website, we develop websites," Riffer said. A customized online catalog is created to match the needs of each end user facility, he said.
Describing AFFLINK's culture, he said, "It's a million miles an hour. It's a very entrepreneurial spirit. It's a very challenging opportunity that you have to continue to re-create. . . . You've got to add value every single day. That's really our whole focus and what we're trying to do."
Asked how he manages to keep all of his customers happy, Riffer immediately identified two things:
- Growing top-line revenue for distributors
- Technology solutions from the Business Services Division
"And even in a tough, tough, down economy, we feel very good because we're changing the game. And that's what has to take place," Riffer said. "We're not standing still. If we would have stayed back in the old model of what a buying group was when they first started this, we'd be out of business."
This article originally appeared in the June 2011 issue of Occupational Health & Safety.