The essential middleman: CMA Darin McLean has built a successful business out of a supply chain necessity. Excellent customer service has kept the business thriving.

The retail supply chain can be a challenge to maintain, especially in smaller Canadian business centres. No one wants to order too much merchandise but nor do they want to wait a week or more to get critical products from larger hubs in other parts of the country.

This is a problem that Darin McLean, CMA, understands well from his own experience as an executive in Halifax, Nova Scotia. But unlike most people, who would simply be frustrated by long lead times and poor distribution practices, McLean saw a great opportunity. His vision led to the creation of Atlantic Mobility Products (AMP) Limited, a very successful communications distributor that continues to grow.

The call for more

In 1998, McLean was an executive with DownEast Communications, a large communications retailer in Atlantic Canada. At that time, all Atlantic Canadian communication retailers were purchasing hardware from suppliers in Ontario or Western Canada.

"We bought from a broker, which meant it took two to three weeks for our phones to arrive. With our growing business, we needed to get the equipment faster. So we started working directly with the suppliers in Calgary but it still took upwards of a week to get the equipment." For some companies this arrangement could also involve going to upwards of 50 different suppliers across the country.

McLean saw that this couldn't work in the long term. He saw the need for a regional distributor, and knew that such an arrangement would create the opportunity to dramatically improve service delivery. AMP was created from this basic idea and is now a viable and profitable Halifax-based business. McLean's management acumen has been an essential part of this growth.

"Our business was run on trial and error at first," McLean admits. "We handled an exclusive line of Motorola accessories at the time. That's where we started the business."

But the first year certainly wasn't easy. It was a 100% shareholder-funded business at the beginning. There was a perception that one dealer was trying to sell products to its competitors, even though McLean maintained an arm's-length agreement with the company. Most manufacturers didn't see the value of AMP's presence on the east coast and only slowly warmed to their presence in the marketplace. Committed to its vision, the company and its initial three employees persisted, developing relationships with suppliers and customers alike.

Within about a year, the company's big break came when Aliant took an interest in their services and became a partner in the business. The business has grown such that it now supplies telecommunications equipment to more than 300 mostly small independent dealers. Aliant dealers are by far its biggest clients, however, for which AMP primarily supplies cellular handsets.

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Value added

The vision for such a company would be nothing, however, without its dedication to client service. The company was created originally to provide faster service to local companies, and just in time delivery is still the cornerstone of the business. This is made easier, to a certain extent, by Aliant's promotions management.

"AMP needs to place orders three months in advance," says McLean. "Aliant provides us with a heads up on future promotions they are planning, and we work on forecasting together. That relationship is clearly crucial for us," notes McLean.

But there have been other service additions along the way, like a call centre and a repair service, that have added to the customer service benefits for all AMP clients.

"Early on in the business, we saw that we were getting more and more calls, asking us if we had this or that product, and it was starting to interfere with picking and packing orders," says McLean. "We set up the call centre to increase service levels."

The customer service centre has since grown from a staff of 2 in 1998 to its current 10 employees.

The repair shop also simplifies the retailers' relationships with manufacturers. All products that the retailers buy from AMP can be sent back to AMP for repairs. The company can also replace defective products and send the damaged items back to the manufacturer for the retailer.

McLean has created a one stop shopping model for all of his telecommunications clients. "Now they only have to worry about one contact for all of their concerns," he says. At the same time, he is always on the lookout for new products that will bring more value to everyone involved.

"Everybody is under margin pressures, so we supply more and varied products to ensure that everyone's bottom line remains profitable," says McLean.

While focusing on client needs, the company hasn't neglected the importance of strong back room systems. In 2001 McLean set up a sophisticated integrated management information system, with an integrated Web site, from which dealers can place and track orders at their convenience, and very strict inventory control using radio frequency hand held devices (rather than traditional paper tickets) to track and fulfill orders. In the end, this simply helps the company serve its clients even more efficiently.

The most recent numbers from the company demonstrate McLean's success at making customer service work for him. In five years, he has gone from having 3 to 68 employees; from 6,000 square feet of facility space to 36,000 square feet; from one client to more than 350; from a few hundred products to more than 2,000.

New horizons?

Change and growth management is nothing new for McLean. In fact, in his previous two jobs he has witnessed and been involved with impressive growth. DownEast Communications went from eight to 40 stores during his tenure; and during his career at Lawtons Drugs, the chain went from 50 to 80 stores.

"I brought a lot of history of growing businesses when I came here," he says. "This was just an evolution of that."

He also credits the CMA with giving him effective tools to use within all of these organizations. "It gave me the experience and the ability to understand where the really critical business was happening within each company."

McLean has tried to give back to CMA as well, as a member of the board of directors of CMA Nova Scotia from 1999 to 2002. He has also been involved with the mentoring program and the organization of various events.

Beyond both work and the CMA, McLean has been involved as a board member for the Discovery Centre in Halifax and for his ward's community association.

His role in the creation and growth of AMP also landed McLean on the Top 40 Under 40 list this year, an accomplishment he is very proud of.

But greater pride will come to McLean from seeing AMP continue to grow and prosper. "We are constantly looking at where we can grow as a business," he says. "We are now logistics experts, which is how we have to view ourselves. We have expanded as much as we can in this business in this area. Now we're looking for other products with which we can adopt the same business model, perhaps in other countries."

And many people will be watching with interest to see how the company grows again.

Robert Colman is editor-in-chief of CMA Management.