With that as a backdrop, Mangano set out to “build a back-office solution for lubricant
distributors that was a true Windows-based product, intuitive and user friendly, fast and
flexible, and capable of changing with times and technology.”
Mangano made no assumptions about what lubricant distributors do, how they do it, or what they
need. Instead, he says he “pulled up a chair and sat down, side-by-side with you, the people
that run the business, do the clerical work, read the reports, and sell and deliver the product
at lubricant distribution companies.” He says he did this for three months and lived and
breathed the challenges of double keying buy backs and the complexities of special pricing,
warehouse transfers, and state taxes. He says he experienced first-hand the frustration and
embarrassment felt by sales reps that didn’t have answers when their customers expected them to
know if they received payment for the last order and if the products they now need are in stock.
And he watched the teeth grinding and hand ringing of business owners that admittedly didn’t
“really” know how much they were making or what they were spending because their reports were
months old, incomplete, or worse yet, nonexistent. And yes, he says he also experienced the
increasing intensity of competition distributors face due to consolidation and the need this
creates for “better managing costs, deploying of assets, and streamlining the business.”
In JW’s view, it was the process of listening and learning about its customers’ wants and
needs that ultimately led to development of a product worthy of four thumbs up. One look
at the main screen of Visual Supplier™ is typically all it takes to drive home the point
that this software is about lubricant distribution, and it’s intuitive and easy to use.
Rather than asking users to get used to a screen full of codes and cryptic commands and
sifting through volumes of documentation, Visual Supplier™ has the familiar and
comforting look and feel of any Windows-based program. Its icons, emoticons, and command
prompts visually speak the language that lubricant distributors know. In fact, in most
cases first-time users can usually take orders, pay bills, or create one of the 65
canned sales reports or 20 accounting reports on the fly, simply by pointing and
clicking their way through prompts that most in this business are familiar with.
And apparently JW is not alone in its view that this product deserves four thumbs up.
Within six years of developing Visual Supplier™, Rax signed up 60 clients (including
some of the big guns) and installed 80 systems. In addition, Visual Supplier™ can now
electronically link up with the systems of both ExxonMobil and ConocoPhillips to provide
lightning-fast payment on buy backs, without the redundancy of double keying. And
according to Mangano, the capability to do the same with Valvoline and Citgo “are in the
works.” Whereas other systems have come and gone, it appears that Rax’s is taking root
with more of the majors. (Since the time of this article, Visual Supplier™can now link
up to all the major suppliers)
According to Mangano, Adaptive Server Anywhere (ASA) from Sybase (~$1,500 for a 10-user system),
is what his customers use.
The support and upgrade contract with Rax costs 20% of the purchase price of the system and
provides clients with “unlimited phone support” and roughly one new system feature (upgrade) a
month. “Last month’s upgrade included a process to give the distributors customers a prompt to
pay discount based on gallons rather than percent,” notes Mangano. He also notes that most of
the upgrades are driven by Rax’s ongoing process of listening and responding to its client’s
changing business needs.
When all the dust settles and the beans are counted, a one-user Visual Supplier™ system will
cost a lubricant distributor about $6,300 for the first year. Then they own it. If they want to
continue with the support and upgrade contract after the first year, they write a check to Rax
for about $800 a year moving forward. But according to Mangano, one-user systems are unusual. A
more typical installation will have five to ten users, which means an investment of $23,500 to
$40,300 for the first year, respectively. After that, they too own the system, and the support
and upgrade contract will cost $3,000 to $5,000 a year.
Mangano agrees that cost is a big issue with distributors, and in fact, “is one of the primary
reasons why astute lubricant distributors have been quick to embrace Visual Supplier.™”
Interestingly, however, Mangano feels it is “not the cost of Visual Supplier™ that ultimately
sells the system, instead, it’s the cost that Visual Supplier™ can drive out of the lubricant
distributor’s operations that really sells the technology.” And in Mangano’s view, and that of
several distributors JW spoke with recently that use the software, these costs become very
apparent and much more manageable when you have a good back-office system in place.
