If you were to ask Maryam “Mimi” Head’s daughters why their family business, Ram Tool Construction Supply Co. Inc., in Birmingham, has been successful, they will probably tell you about their mother’s decision-making skills.
Take, for example, the story of how she made the decision to become an entrepreneur in the first place. After having worked as the director of marketing for the National Bank of Commerce from 1981 to 1984, Head determined that what she really wanted to do was to become a business owner. She just had to figure out what kind of business she wanted.
So, she sought advice from her husband, the late Beverly Pierce Head III. She consulted several other mentors. She considered several types of businesses. Then, after careful deliberation, weighing all of her options, she decided to buy Ram Tool, a small company that sold construction supplies and materials, says her daughter Hillery Head, who runs the company with her sister, Maye Head Frei.
“The other businesses she looked at didn’t seem to have the potential, ” says Hillery Head. “She thought, ‘If I’m going to work and run my business, I want it to be a legitimate, real business that has real opportunity and that has potential for growth and advancement.’”
Since then, Ram Tool has grown into one of the largest privately held companies in Birmingham, with annual sales of more than $280 million, Hillery Head says. The company sells specialty commercial construction supplies — from fasteners, power tools, generators, pressure washers and water pumps to masonry and water proofing supplies and drywall. The company transports those products from its more than 30 warehouses across the Southeast, Texas and Mid-Atlantic to commercial construction job sites.
Hillery Head says Ram Tool has kept the same business model and the core values of its founder, Dee Gonder. On its website, Ram Tool promises customers “heroic service” and a “sense of urgency” in getting products to their construction sites.
“We have a delivery infrastructure in place that allows us to do same day delivery, ” says Maye Head. “So our sales cycle is pretty short that way. Ninety-eight percent of our orders are delivered free the same day.”
Winning customers is especially challenging these days given the number of rivals they have in the industry such as the Birmingham-based Tool-Smith and general distributors like Grainger, Fastenal and HD Supply that sell the same kinds of tools and supplies, says Thomas DeCarlo, Ph.D., a professor and the Ben S. Weil Endowed Chair of Industrial Distribution in the UAB School of Business.
“Then you have a number of retailers who also sell these types of supplies, ” he says. “So, the competition is immense in this industry.”
To stay competitive, Hillery Head says Ram Tool’s inside and outside sales teams strive to say “yes” to customers who request specialty items, even if the products are not in stock. Last fall, for example, the Ram Tool team found an aerial drone for a client in Dallas.
“We do a lot of training of our personnel so that it’s instilled in our culture to help the customer quickly, ” Hillery Head says. “We always try to say, ‘Yes, we can’ and to do it quickly. A lot of times the customer just needs to know that we’re working on it and that we’re on it.”
Maye Head says that because of the sales infrastructure they have in place, their sales teams can source a lot of material so that customers can simply pick up the phone and call a single company to buy everything they need.
“We find any material they want, ” says Maye Head, “and we make those investments in those infrastructures in order to take care of our customers.”
To keep track of the more than 30, 000 items it has in stock, the company uses the SAP inventory management software system, Hillery Head says. Ram Tool also has what she calls a “robust” cycle counting program that allows them to count quick-selling items monthly and slower-moving products every other month up to once a year.
The technology is a far cry from when Mimi Head bought the company in 1984. Ram Tool’s previous owners, says Hillery Head, did not use computers.
“The most important thing she [Mimi] did was to put the company on a computer system, ” Hillery Head says. “When she was able to do that, she could keep track of inventory and AR balances, keep track of vendor purchases and sales from specific salesmen and sales to specific customers. That helped her a lot in organizing the business and building a platform on which growth could be achieved and a model that could be replicated in other markets.”
Ram Tool today works with more than 3, 000 vendors, Hillery Head says, and the company regularly fields calls from companies wanting to be included in the mix of products Ram Tool sells.
But Ram Tool also actively recruits vendors. “Especially if we go into a new market, ” she says. “If there is a vendor that has a strong name in that market, we’ll approach them.”
Ram Tool has grown steadily and expanded into new markets over the years. It now has more than 850 employees in 12 states and the District of Columbia, including Alabama, Florida, Georgia, Mississippi, Louisiana, Tennessee, Texas, Oklahoma, South Carolina, North Carolina, West Virginia and Virginia.
In 2012, Ram Tool acquired Marco Supply, a company in Roanoke, Virginia. Two years later, in June 2014, they bought Otto Dukes Construction Supply, a family-owned company in Corpus Christi, Texas. Their latest acquisition occurred last September, when Ram Tool purchased Jim and Slim’s Tool Supply, a 43-year-old company in Largo, Florida.
“We’re always looking for good opportunities, and we’re always looking for new markets, ” says Hillery Head. “That being said, Ram Tool grows like a puddle. If you look at our footprint, we started in Birmingham and when Mimi bought the company in 1984, we just crept out from there and hit the good markets that we found on the edges of our puddle. So we are always looking at the edges of our puddle to see good opportunities.”
Ram Tool has been rated as one of the largest women-owned businesses in Birmingham, and Hillery Head says she has seen more women among their vendors and in the construction industry than when she first joined the company in 1993.
A Yale graduate with a law degree from Washington and Lee University School of Law, Hillery Head became the company’s president in 2005 and its CEO in 2009, the year her mother retired from the business. In February, she turned the role of president over to Page Naftel, who moved up from his role as head of sales.
Maye Head, also a graduate of Yale and chairman of the board of Ram Tool, says she has learned much from working alongside her mother.
“Mimi has a great instinct for doing the right thing, making the right hire and making the right decisions, ” she says.
Hillery Head says the best advice she has received from her mother was to never accept easy answers.
“Another thing she taught us was to not have ‘analysis paralysis, ’” says Hillery Head. “Better to go ahead and make a decision quickly and move on with that. If it’s the wrong decision, it’s easier to back up and to reverse than to just sit around and not do anything. So it’s important to make decisions quickly and then move to execute them quickly.”
Gail Short and Cary Norton are freelance contributors to Business Alabama. Both are based in Birmingham.
Text by Gail Allyn Short • Photos by Cary Norton