Success Is Not A Commodity – Cypress aims for steady growth – Brief Article
Michael Barrier
It’s a problem faced by business people in many industries, selling everything from toothpaste to personal computers. If the market looks at your products as commodities, virtually indistinguishable from those of your competitors, how do you persuade customers otherwise?
That was the challenge Alan Bagliore faced more than 10 years ago when he founded a McHenry, Ill.. company called Cypress Medical Products. It sells such things as latex gloves, crutches, and bandage rolls.
“It’s a commodity product line for the most part,” Bagliore says, “but commodities have different levels of quality” Commodity sellers provide different levels of service, too, and Cypress tried to set itself apart with what Bagliore calls “a tailor-made service program.”
“You create problems for your customers when your shipments are late,” he says, “when your shipments come in pieces, when the quality is not there, when the sales support is not there. We look at it in this light: How do we make the people we work for”–the customers, that is–“happy? You do that by removing their problems.”
Bagliore, 51, is a native of New York City and has worked in the medical-products industry for more than 25 years. He moved up from taking telephone orders to increasingly responsible sales and management positions, until he decided he was tired of working for someone else.
He asked a former colleague, Varun Soni, to join him as a partner, and the credibility they had earned in the industry helped them get a line of credit for $750,000 from a bank, as well as good terms from the manufacturers, many of them foreign, whose products Cypress assembles or repackages.
Bagliore immediately got a lesson in heeding customers’ wishes. His original plan for the company was “totally revamped” after his first visit to a customer; he says. “He said, ‘If you want to do business with us, you will do this, this, and this’ “–carrying inventory, for instance–“and our game plan went out the window.”
As successful as Cypress is by most measures–it has annual sales of around $45 million and about 90 employees–Bagliore is far from satisfied. “In every industry,” he says, “you have different levels. We’re kind of an A-minus company now; we’re going toward the top of the classifications.”
What accounts for that rating, he says, is “what you can do for the customer. When you jump from a C to B, it’s quality of product more than anything. When you jump from a B to an A, it’s the services you can provide the customer.”
Because Cypress’ customers are not end users but dealers in medical supplies, the questions Cypress must ask itself include these, Bagliore says: “Can you attend their sales meetings and give their sales force what they need to succeed in selling your product? Can you come up with innovative programs for their sales force that give them an incentive to sell your product?”
Cypress now accounts for about 5 percent of the industry’s sales in its major product line–examination gloves–“and less than 2 percent in our other product lines,” Bagliore says, “so we have tremendous room for growth.” Gloves in particular account for an expanding market, thanks to greater awareness of the need for protection from HIV and hepatitis B.
Bagliore doesn’t talk like a man who will be tempted to pursue that growth recklessly. “I’ve had a tremendous fear of losing what I have, throughout my entire life,” he says. “You build it weak, it stays weak. You build it strong, you’re going to endure.”
COPYRIGHT 1998 U.S. Chamber of Commerce
COPYRIGHT 2000 Gale Group
