West Texas Container (WTC)

Why West Texas Container was started.
In 1978, when opening a sheet plant in Tucson, we learned that traditional box manufacturers had their crystal ball wearing blinders. There were too many misguided decisions. To differentiate our products and corporate message, we successfully implemented a direct sales strategy. We would do the same in El Paso, when we launched West Texas Container (WTC) in 1997, but with more hardships.

Why? Local box makers were practicing ‘if things were late, they were worth the wait.’ Yet, we saw an opportunity to prevail with JIT, quality printing and local structural designing.

Finding Good Employees

It’s no secret that finding able, experienced employees was tough in a small market. One small bushiness owner, who avoids local recruitment firms,  told me that he preferred to do his own search through networking and local classified ads. He said, “God gives milk an I have the pail for it.” (Maybe his solution starts with reflective leadership or market based management?)
To illustrate, when an existing corporate culture is protected or there is a tight labor market, consider, “Five years ago I advertised for an administrative assistant and had more than 30 responses to a four-line ad. The person hired moved on to a better job, and I ran the same ad this year. I only had four responses and there was no way I could consider any of those untrained applicants. In the end, I had to call my ex-employee and hire her back at 20 percent more than her previous salary,” explains the frustrated entrepreneur.

Hiring for Direct Sales

Sales people are the vital link between the customer and the company. One day, one of my friends, a box maker, noted that he had a revolving door in
one position. “No matter how deeply I checked references, and no matter how cautious I was in hiring the best candidate, I just couldn’t get it right,” he told me. “I hired, trained and patiently waited for increased sales with three people, before the fourth hire paid off. It’s an awfully expensive process.”
He’s right. Small companies with less than $6 million in sales, rarely have the money or the expertise to find the winning salespeople, customer service people and managers.
So, to set ourselves apart, I changed our business model. It will take WTC in a uniquely different direction.

Entrepreneurial Risks

The goal has always been to grow slowly, organically, steadily, and profitably, but with an intense passion for performance.
Shall the plan materialize?
I surmised that intensity is everything, but not for everyone. As the sheet plant adapted to the local relaxed service, I had made a conscious decision to bootstrap.
In contrast, plenty of flashy start-ups, especially high-tech companies, believe in the “big bang” model, with very fast growth, fueled by lots and lots of poaching, investment and debt. Bootstrapped companies start slow on somebody’s cash. And in their turnaround, you learn a lot about ambiguity in making a profit. It can mean becoming a high risk venture. In opening our 35,000 sq.ft. sheet plant in El Paso, I hoped that it would not be insular, but
cost-effective on a limited budget. Thus, when I bootstrapped, rather than viewing mistakes as something I’ve done wrong, I look at improvement opportunities. I wanted to better grasp the degree to which customers were aware of our box business competence. Hopefully, never to outstrip the quality of the goods or services we were providing them.

In Pursuit of Excellence

Unfortunately, the future has a way of sneaking up on us. We weren’t afraid of our competition, as we believed a kite rises against the wind, not with the wind. But it did mean we had to hire a team that understands and shares goals. After hiring two new applicants, in 2000, I was still ambivalent with their caliber of innovative skills. They had some experience, but didn’t meet all my sales criteria. As a performance oriented entrepreneur I definitely didn’t  ant to hire someone else’s mistake. Besides, local sales commission was based on sales dollars, which was customary in El Paso.My plan needed to be the right fit. It is all about a basic work ethic. This is normally difficult to change in people. A new salesperson needs an investment of time and money to learn the territory and its accounts. Usually it takes six months to a year to be productive and pay for themselves. The result?WTC needed $1 million loan from our other plants to escape from the valley of death. A crucial next step was to improve the timeliness of quotes and corrective action by
our employee centered management.

New Strategy- Brokers/Agents

The art of being wise is knowing when to stop. In California our sales expertise is with broker/agents and distributors. The trick is to understand the sensitivities of the market.
So, in 2002, our cross-functional team began to compile a list of individuals working for El Paso distributors, supply firms and industrial sales reps. We then went with the broker approach saying, “If you are interested, tell us. Here’s what we have to offer. An opportunity to keep
most of the profits you generate, but pay us for the business support services and the product with the delivery costs you need.”
Our nimble sheet plant would offer fast quoting, broker load tags on shipments, office space, phone, fax, copier, postage and Internet access. We also would provide  commission and inventory reports; on-site design services, free inside sales backup when the salesperson is sick or on vacation; and a secure, friendly environment.
Within a month we had half a dozen responses. Most came from people who had their oars in the water and were anxious to start or had their own small broker business. We had a tough time selecting those we believed would be credit worthy and row our ‘sales’ boat faster.
Even though some candidates were once selling a few packaging products, we believed that they would have inevitable setbacks. Hiring knowledgeable independent contractors would allow this box maker to build in a small profit for services rendered, by providing custom designs, quality corrugated boxes and JIT deliveries. WTC justified using brokers “because we don’t want to hire people, do a lot of training, and then have them leave. We get them after they’ve been through the weaning process, the educational process,” says Chris Widera.
Brokers/agents and packaging distributors have many product lines. They bring with them a price-bid business. Value added products becomea commodity and difficult to sell at higher margin because most sell on price. When we do 300 quotes and receive 30 orders, something is not right. The sales process can be a win-win situation for all involved. Typically in our box making business, the inside salespeople have been order takers. But from the start, we made them more proactive. They now call customers, to inform, build rapport and relationships. You can sense the soul of West Texas when speaking to our sales service team. “I think our people like to stay here because we try to make it a fun place to work – for real. Our people are loyal – they care. We involve them in decision-making and the things that affect their job,” says Nick Widera, GM, who is steering the ship.

Update – 15 years later

Today, we believe that our best sales growth solution for manufacturing in smaller markets is a combination of selected direct sales by our employees and through loyal broker/agents, distributors, plus our website.
Events are forcing changes. WTC is grabbing hold of the future with continuous improvement. For starters, we have moved into our own 85,000 sq. fit. building near the Mexican boarder. Plus, we have upgraded every machine, every interface and every system into one vast, interconnected virtual manufacturing web that is accessible, traceable and trackable from any secured smart
phone anywhere in the world.