Tri-State Enterprises: Pedal To The Metal

[Counterman]

In the spring of 2020 – when it was becoming clear that the pandemic wasn’t going away anytime soon – a member of the Tri-State Enterprises buying team asked owner Tristan Taylor how the company should proceed. It was a conversation undoubtedly taking place in executive offices across the country, with a public health crisis – and the specter of an economic recession – looming on the horizon.

Taylor’s message to his buyer was simple.

“I said, ‘Don’t take your foot off the gas. Let’s keep going,’” Taylor recalls. “Looking back, the pandemic is lasting much longer than we thought. But at the time, my gut told me that we don’t want to take our foot off the gas.”

While it was a bold decision in the moment, it wasn’t out of character for Taylor or Tri-State Enterprises. The Fort-Smith Arkansas-based distributor of truck accessories, hard parts and mobile audio/electronics has enjoyed double-digital annual growth “for many, many years,” according to Taylor – and 2020 turned out to be no exception.

“We’ve never really had a month where we went backward in sales,” Taylor says. “We’ve always been very fortunate and very blessed as a company to be always moving forward.”

Tri-State’s unique mix of must-have products (spark plugs, motor oil, belts and hoses, etc.) and nice-to-have products (lift kits, truck-bed covers, window tint, etc.) gives the company a broad sweetspot that straddles the traditional repair/maintenance and enthusiast markets. When the stimulus checks hit consumers’ bank accounts in 2020, Tri-State was in a prime position to capitalize on the surge in spending that swept through the automotive aftermarket.

“We had a fantastic 2020,” Taylor says. When AMN/Counterman spoke to Taylor in late August, he estimated that the company was on-pace for 40% year-over-year sales growth in 2021.

Taylor makes no bones about the fact that “we’re a very aggressive company,” at least when it comes to Tri-State’s growth mindset. Case in point: In the midst of the pandemic, Tri-State acquired the O.W. Donald Co., a Fort Smith-based distributor of 12-volt electronics (speakers, back-up cameras, remote-start systems, etc.). Announced in April 2020, the deal expanded Tri-State’s 12-volt portfolio and provided a foot in the door for a market that the company had been eyeing for some time: Texas.

“We’ve always been a company that’s willing to take a risk,” Taylor says. “We measure that risk, and we measure it and then measure it again, so to speak. But we’re not afraid to take a chance on something if we feel like it’s got a good shot.”

Roots in Radio

The late W.O. Byrd, who founded Tri-State in 1977, probably was smiling down from heaven when the company acquired O.W. Donald. In the early years, Tri-State primarily sold Ford Motorcraft parts and radio equipment, out of a warehouse in Fort Smith. Prior to that, legend has it that Byrd – who was affectionately known as “Dub” – got his start selling AM/FM radios and antennae masts out of his van.

“The joke was when the doors were closed on the van, the warehouse was closed,” Taylor says.

Jim Miller – Taylor’s father-in-law – joined the company as a salesman in the late 1970s, and Byrd later appointed him as general manager. Together, Byrd and Miller grew the company, selling Motorcraft parts, along with accessories such as cruise-control kits.

“Cassette-tape players became a big business for them,” Taylor adds.

Fresh out of high school, Taylor joined the company in April 1987, helping out on the phones in the mornings and working in the shipping department in the afternoons. Eventually, he became a full-time salesman, and later stepped up to the role of sales manager.

When Byrd passed away in 2007, Byrd’s daughter, Martha, took ownership of the company. In 2015, Taylor (who was general manager at that point) and his wife, Kim, purchased Tri-State.

“My wife and I were fortunate enough to have a really good working relationship with our bank, so we were able to pretty much finance the company through the bank we were doing business with,” Taylor explains.

From its humble beginnings in three states (hence the name), Tri-State today boasts a footprint that reaches Arkansas, Kansas, Louisiana, Missouri, Oklahoma and Texas, as well as parts of Illinois, Kentucky, Mississippi and Tennessee.

link hidden, please login to view

W.O. Byrd founded Tri-State in 1977.

With the recent acquisition of W M Automotive (more on that in a bit), Tri-State now has around 600 employees. Taylor emphasizes that Tri-State’s team members are “the most valuable part of our company,” which is reflected in the company’s slogan: “People-Driven.”

“For the past seven or eight years, we’ve been focused on building a really good team of individuals who we feel can help propel Tri-State to the next level,” Taylor says. “And I think we’ve been very successful in doing that so far.”

The Tri-State team includes Taylor’s son, Devon, who has been involved with the company since he was in high school. After graduating from the University of Arkansas-Fort Smith in 2014, Devon stepped into the open position of marketing director, and worked his way up to his current role, vice president.

Tristan emphasizes that he never pushed Devon to work in the family business, nor did he push Devon’s sister, Kenzie (who joined the company in May after graduating college). Fortunately, he didn’t need to, as Devon admits that he was hooked from the very beginning.

“I was coming in during the summers pulling stock adjustments, and that isn’t the cleanest stuff in the warehouse,” Devon recalls. “I would come home dirty from head to toe, but I saw Tristan’s passion for this business, and I saw the people who were involved in this business. I knew that this was what I wanted to do in the long run.”

Like Devon Taylor, many Tri-State team members are in it for the long haul. Turnover is low – especially in management and supervisory positions – and Tristan points out that “we’ve always been blessed with being able to find good people.”

“I’ve been here for 34 years, and I have employees who have been here longer than I have,” Tristan adds.

Tri-State’s identity – the way the company treats its team members, customers and suppliers – is rooted in the Golden Rule, which Tristan attributes to its founder, Dub Byrd.

“I think we’ve always had a reputation in the industry for honesty and integrity,” Tristan explains. “ … We feel fortunate that we’ve always had a company that really stood on good Christian values and principles and always tried to do the right thing.”

A Great Fit

Reflective of its unique product mix, Tri-State is a proud member of both Pronto Automotive Distribution Network (formerly the Automotive Distribution Network) and the AAM Group. The AAM Group, which caters to distributors and manufacturers of automotive accessories, named Tri-State its Member of the Year in 2017 and 2021.

“We put a high value on both of those partnerships,” Tristan says.

Tri-State joined the Automotive Distribution Network in 2014. It was through Tri-State’s involvement in The Network that the Taylors got acquainted with Garry Castles, the former president of W M Automotive in Fort Worth, and some of his team members.

The parallels between Tri-State and W M Automotive were readily apparent. Founded in 1976, W M Automotive – like Tri-State – is a family-owned and family-oriented warehouse distributor that came from humble beginnings. The late Wilson McMillion shepherded W M from a small operation with a handful of employees to a full-line regional warehouse distributor with more than 200 employees and a strong presence in Texas, Oklahoma and Kansas.

link hidden, please login to view

Tri-State now boasts about 1 million square feet of warehouse space throughout the Central United States.

And like Tri-State, W M has a company culture steeped in Christian values. McMillion, who passed away in 2018, was a religious man, and his approach to business was intertwined with his strong faith. At company functions, he would hand out 12-inch rulers with the Golden Rule printed on them.   

Those parallels served as a strong foundation for the Taylors to establish a genuine camaraderie with the W M Automotive leadership team – which culminated in Tri-State’s acquisition of W M in May.

“I know they had other suitors,” Tristan says. “At the end of the day, I think they looked at our culture, and they knew that we were a Christian-based company, and that was probably one of the big factors that led them to make the decision that they did.”

In any merger or acquisition – regardless of how well the companies mesh – there will be challenges throughout the process of bringing the two organizations together. Devon recalls one difficult patch that revealed a lot about the character of both companies’ leadership teams.

“We got together and just prayed to put peace over the situation,” he explains. “That was something that doesn’t happen in every acquisition.”

If the O.W. Donald deal was a foot in the door to the Texas market, the acquisition of W M Automotive was Tri-State’s decision “to really go there in a big way,” as Tristan puts it. W M has 38 independently owned Parts Plus stores in Texas, and it sells to more than 100 independently owned stores in Texas, Oklahoma and Kansas. It supplies these stores from its 110,000-square-foot warehouse in Fort Worth.

The W M acquisition inspired Tri-State to lease a 492,000-square-foot warehouse in Arlington, which the company is outfitting with the latest robotics and material-handling technologies. The warehouse is strategically located “pretty much dead-center in the heart of the [Dallas-Fort Worth] market,” according to Devon.

With the new warehouse in Arlington and the addition of W M’s warehouse in Fort Worth, Tri-State now boasts approximately 1 million square feet of warehouse space throughout the Central United States. On the heels of the W M acquisition – Tri-State’s biggest yet – the company will continue to look for new opportunities, with an eye on expanding its footprint into the Eastern and Western parts of the country.

The Taylors also are open to branching out into more product categories, such as RV parts.

“There are so many opportunities out there right now, it’s kind of scary,” Tristan says. “The challenge we have today – and maybe we’ve just been fortunate to have so many opportunities presented to us – is trying to figure out which ones to take advantage of.”

The post

link hidden, please login to view

appeared first on

link hidden, please login to view

.

link hidden, please login to view