Disrupting a B2B Commerce Market

Disrupting a B2B Commerce Market with Sean McDonnell

Jary Carter: Alright everybody, welcome to the podcast Digitizing B2B with Jary Carter. I am here with Sean McDonnell, who’s the CEO and founder at Trupar. Sean, welcome to the podcast. I’m so happy to have you here, I’m honored to be chatting with you here today. Welcome!

Sean McDonnell: Thank you.

Jary Carter: Let’s just jump right in because we’re going to try to keep this short, hard-hitting, and super informational. Tell us, just to kind of back up here to the beginning here, tell us a little bit about Trupar, Sean, just for those that aren’t familiar with that.

Sean McDonnell: Trupar.com is an industrial equipment replacement parts eCommerce site. My background is a little bit… I grew up in the industry, and so essentially I saw an opportunity to sell replacement parts for forklifts, aerial lifts, sweeper scrubbers online. I can give you a little bit of the full story, but it depends on what you guys want to hear.

Jary Carter: I think this is great! For our audience here, I’m here in LA with Sean. Sean, you don’t look like somebody who is running a forklift parts business. Tell me a little bit about how you got into this. Just how did you get into running this business Trupar?

Sean McDonnell: For my entire life, my father has owned and operated an industrial equipment dealership called Trupar America Inc. He sells forklifts, industrial sweeper scrubbers and areal lifts. Trupar America is a full service dealership, meaning they provide equipment, service, parts within their sales territory.

Sean McDonnell: In 2007 after barely graduating high school, I decided not to get into the family business and move from my hometown in Pittsburgh Pennsylvania to Aspen Colorado to be a ski bum.

Jary Carter:     That’s fun!

Sean McDonnell: It was! In 2010 after doing the ski bum thing for a few years, I got my first computer, read a couple digital marketing books, and started a local digital marketing agency in Aspen called Online Dynamics. Shortly after founding Online Dynamics, my father’s equipment dealership became one of my digital marketing clients. We worked with him for two years, mainly promoting offline equipment leads for his sales people. And then I realized due to the niche profile of the industry, no one was selling replacement parts for that equipment online.

Jary Carter: So you were, just to be clear, you were doing digital marketing for your dad’s equipment dealership. And you began kind of this agency where you were doing this kind of online marketing for companies. Is that correct?

Sean McDonnell: Yeah, for all types of companies. ‘Cause he was my dad and he was really old school. You know…

Jary Carter: He needed help.

Sean McDonnell: He was like, help me sell some equipment. And so we started doing this and I realized that market was so much less competitive versus the real estate market or some other things whenever it came to ranking on Google and kind of getting traffic to a site.

Sean McDonnell: I said to him, I proposed the idea to my dad that we should create an eCommerce site. Once realizing that there was so much opportunity online in general for this industry, I proposed then we should start an eCommerce site, explaining to him that the huge opportunity. His response was, go ahead and try, but it will never work. People buy from people in the traditional mentality that it was. And so I was convinced it would work, and spent all my savings, nights and weekends building Trupar.com.

Jary Carter: It’s interesting because you had had this experience of kind of doing this, testing the waters from online marketing. You had really this kind of inside sense and track that it would work …

Sean McDonnell: Yeah.

Jary Carter: Just from probably a lot of the digital marketing you were doing.

Sean McDonnell: Right. And I mean for instance, there was real estate agents in Aspen Colorado, it’s a resort destination, that would pay me to do SEO for them, and I couldn’t get these real estate agents to the first page of Google for a local search, but I had my father’s company for equipment leads, he was getting leads from all over the world.

Jary Carter: It was just the competition was so much less intense than other markets, even local markets.

Sean McDonnell: Exactly!

Jary Carter: Fascinating.

Sean McDonnell: So I mean, I said, let’s go bigger with this. We can sell parts, and things that can ship in a box, versus … The problem with my father’s model was that it was all leading back to phone calls, and kind of following up on a lead. And I was like, let’s sell this stuff online so we can scale.

Sean McDonnell: Because of my family’s history in the industrial industry, I was able to set up a meeting with top executives from the industry’s largest wholesale distribution company, and the execs were obviously skeptical too. But they said, we’ll sell to you. We’ll let you buy off of us and go ahead and try it, once again. Because of that relationship, they allowed me to be a distributor of theirs. And so in September 2012, Trupar.com was born. And whenever I launched it, at 1.7 million parts for 475 industrial equipment manufacturers, and during the first couple years there were a lot of-

Sean McDonnell: I essentially realized that I couldn’t go full eCommerce with this, so one of the big lessons learned from that experience was because of my dad’s traditional mentality, I was like, I want to automate this whole thing, go Amazon style, no one will pick up the phones. If you build it right …

Jary Carter: Yeah, totally automated wholesales people, …

Sean McDonnell: Right. None of it.

Jary Carter: No customer service. You were just going to run a digital operation.

Sean McDonnell: Correct. And so I learned the hard way that the industry wasn’t quite ready for that. And whenever it comes to something fixing a piece of equipment that’s running your operation, you need kind of a hybrid model. So over the next couple of years I really developed that hybrid model of how much self-service can we do, and what type of customer service do customers need?

Sean McDonnell: And at this point, it’s about 85% of my customers, we never talk to. And then there’s the other 15% that will give us a call and have questions, or just make sure we’re a real company, etc., and it’s that 15% that I’ve staffed knowledgeable customer service people, and really these people, they’re enabling you to purchase through the website, and answer all of the questions before you deal.

Jary Carter: So you launched this in September of 2012. Fast forward to today. Give me just kind of a couple of statistics about where Trupar.com is today from its beginnings.

Sean McDonnell: Its beginnings were in my one bedroom apartment in Aspen Colorado. And it has grown to an international company serving more than 45,000 happy customers, with a catalog with over 8,000,000 skews for 600 brands.

Jary Carter: Wow…. wow- That’s incredible.

Sean McDonnell: I mean, to put in perspective, my dad’s business in 40 years in business I think has about 1,000 customers. So it’s one of those things that we’ve grown a lot faster than I had ever expected, and now I’ve just been trying to keep up.

Jary Carter: 45,000 customers against 1,000 customers in a traditionally offline business.

Sean McDonnell: Correct.

Jary Carter: Wow, that’s fascinating. I didn’t know that. I didn’t that those statistics were so stark.

Jary Carter: So today, from what I know about your organization, you’re running a predominantly digital organization. Almost everything you do is online. And you run a very lean organization. You don’t have tons of warehouses, support staff, customer service. Those teams are fairly small from what I know of your business.

Jary Carter: A lot of our customers are running these digital initiatives very leanly. Even in really big companies, the digital initiatives, the digital teams are very small. You’ve had a lot of success running … I mean, 45,000 customers and growing, and with a pretty small digital team. How are you doing that? What are you doing to succeed there?

Sean McDonnell: One of my biggest things … I’m asked that often. And one of my biggest kind of initiatives, or one of the things that I push to traditional companies, is that though you digital team may be small, the fact is that if you want to do eCommerce successfully, it can’t be a marketing brochure. It can’t be some promotion that you’re running, it needs to be integrated into every piece of the business. And you really need to start with the customer and work backward, because though some of them are traditional, quote unquote customers, the fact is that if they find you online, they expect a little bit different of an experience.

Sean McDonnell: So really, one of my favorite sayings is from Jeff Bezos, the founder of Amazon, he said that even well-meaning gatekeepers slow innovation. When a platform is self-service, even the improbable ideas can get tried because there’s no expert gatekeeper ready to say that will never work. Guess what? Many of those improbable ideas do work.

Jary Carter: So this almost goes back to what your dad’s saying, hey, go ahead and try it, it’s never going to work. People buy from people. And you saying, hey gatekeeper, I’m just going to do it.

Sean McDonnell: And that’s the thing, if it wasn’t my father that I’m sure at the companies that we’re talking about here, if there’s a digital team, the fact is that there are people there working there that have done business for X amount of years one specific way. And whenever you add this channel like eCommerce to the equation, if your internal customer support staff or sales staff isn’t enabling your customers to buy online, and kind of setting up those accounts, and really kind of being that grease of the wheel, then it becomes this siloed channel instead of your entire operation working around it.

Sean McDonnell: And that’s why I said, really designing everything from the customer’s perspective, and working backward. What is the best customer experience that they can have here, as far as logging in and creating an account, to getting notified about orders shipped? The list goes on and on. But if you don’t build your eCommerce system around your customer, and then build your business around that, there’s often mixed messaging, and kind of struggles.

Jary Carter: I totally see what you’re saying. I want to go back to this idea of what your dad said to you, which is like, hey this is never going to work. Because I think in the market right now, we see there’s a lot of people saying that like, hey, eCommerce may work for other industries, but in our industry, people just buy from people. It’s too complex. Or this is a relationship business. I’ve heard all of it. What would you say to those people that are skeptical about whether or not their customers are actually ready to purchase online?

Sean McDonnell: Stop being a gatekeeper. To be honest, you really never know until you know. And I think that you can’t just … I mean, obviously going online, especially the more complex your business is, it’s an investment. Not only a financial investment, but a time investment, and resources. And a lot of companies say, we don’t have that person. And a big thing that I’ve pitched before is, when you’re hiring someone, or whenever you’re promoting someone to take on this initiative, you really need to let them run as a separate company. Even internally, you need to give them parameters so they can make decisions and try things out and test them and fail, and all of things that an entrepreneur does, because if you don’t do that, then you’re going to find yourself in a position where you’re building an eCommerce system around how you do business. And it never works out very well.

Jary Carter: Versus around how the customers want to buy.

Sean McDonnell: Exactly. I think that there’s a number of strategies to go to market for eCommerce, but really what it comes down to is, we want to make our customer’s jobs and lives easier. In B2B, my customers are doing their job whenever they’re purchasing from me. So if I’m making their job a little bit easier because there’s less people doing more work at my customer’s companies, because there’s less people doing more work, and I take their time to acquire parts for their equipment from two hours a week down to 20 minutes a week, that’s a lot of time saved. But the key is to build it so that it makes it as easy as possible, and you aren’t making it harder for them to do business with you.

Jary Carter: So what I’m hearing is you need this person that’s running, or kind of setting up this initiative, really needs to have the autonomy to almost rethink the customer experience, versus try to sort of take the existing complications of purchasing and put that online. They need to have really almost like a customer first, customer centric viewpoint of how they imagine the person’s experience from the customer’s standpoint.

Sean McDonnell: Correct. So say your company has some specific things. Obviously, you need to get paid, you need to get the products out the door, there’s some specific things that are deal breakers. And so you put those parameters around someone internally at your organization that’s going to design this and say, we need to check all these boxes, go for it. Then you can build it around that, instead of building it around, well, this is our process for setting up an account, and you need to go get credit terms, and wait for two days for the accounting department to get back to you. And then you need to file a purchase order in this format. All of these things that just kind of are adding extra steps to doing business with you.

Sean McDonnell: And so really kind of starting with the customer, what do they need to do? And then what do you need to do to enable them? And work from there.

Jary Carter: And some of those steps are deal breakers for customers. Credit check may be mandatory, and that may take a day or two, and they may have to be worked into the process. But sometimes those barriers are artificial that are created, or are at least company made.

Sean McDonnell: Correct. And I think that even the ones that you see as deal breakers … For instance, going to the credit check. That was always a big thing for me was my father’s company has his accounting department that would go look up the DNV account, and all of these things to … And my mentality always was like, dad, you’re not a bank. Whenever you check credit personally, they check it against your credit – I mean, there’s a whole industry around it. And so I found a third party called Approve that also integrates with Oro that will handle that credit check, and also hold the terms for my customers so that my customers can checkout online easily. So these are things that a lot of your processes that are deal breakers, I guess I would just challenge to rethink to say maybe there is a better way to do this.

Jary Carter: That’s great. And hence the give some autonomy to re-imagine that to somebody really smart within your organization. I like that.

Jary Carter: You’re competing … And this is interesting because I think you’re a really interesting case study for a lot of companies, because you’re competing as really a digital player in a predominantly offline competitive market.

Sean McDonnell: Sounds like a song or something…

Jary Carter: What’s that like? So you’re this digital competitor in this offline world. And a lot of our customers actually, a lot of the companies that we talk to are saying the same thing to us, hey, we’re going to be one of the first to market here. What’s that like for you? Is it tough? Are you educating? Are you a kid in a candy store? What’s happening? Or all of the above?

Sean McDonnell: I mean, all of the above. It’s a blue ocean, but I definitely don’t get invited to the hobnob industry events and stuff. I’m kind of like the pirate.

Jary Carter: You’re the disruptor. Those 45,000 customers had to come from somewhere.

Sean McDonnell: Exactly. And that’s the whole thing is like my dad and all of his competitors are also buddies at the conferences, just because it’s a pretty small industry, and I’m just this outsider that no one really knows what’s going on. I found myself on the outside there, but it allows me to look at things through a different lens. It allows me to kind of rethink everything, and not be so closed off to what the opportunities are, and how to really take care of the customers, and learn from companies like Amazon and other companies that aren’t B2B specifically, but the customers are buying off of these other websites in their personal time. So learning from that, and kind of really making the experience as seamless as possible for them has allowed me to … Not being so in the industry has really given me the opportunity to look elsewhere.

Jary Carter: Well, it’s interesting. I mean, it’s clear that you’re a disruptor in your market, which it’s interesting to have this industry that’s probably the forklift part industry is probably not growing at 50, 60% a year. Maybe it’s growing five to 10% a year, but you are massively disrupting within that growth. To get 45,000 customers in six years, you’re taking them from other places.

Sean McDonnell: And that’s actually an interesting point. Something early on whenever I contacted one of the main suppliers wholesale distributors in the industry that is now a vendor of mine, and they said it will never work as well. They said, okay, there’s this small little percent down at the bottom of it isn’t covered by our traditional distribution network. And I obviously questioned it because I questioned everything in that time. And what I found and what they found is that I’m not only taking customers from their distributors, but I have their customers purchasing off of me.

Sean McDonnell: Whether it’s cross lines, why someone would buy off of me whenever I’m buying it through my supplier instead of going directly to my supplier whenever they have an account, I can’t answer that question other than I’ve paid attention to the customer experience better, I’ve done better marketing, whatever. But the fact that the whole supply chain is getting disrupted because people don’t buy in the same manner that the supply chain says they should be buying in.

Jary Carter: I think what it proves is that kind of what you were saying earlier on which is the idea that a B2B buyer is actually just a B2C buyer who goes to work. And these folks are used to buying on Amazon, they buy on websites all day long for their personal things, and they want to do the same thing, and they’re going to go to the place where they have the best customer experience.

Sean McDonnell: Right.

Jary Carter: And really that’s what’s going to win.

Sean McDonnell: Because it’s not their money. At the end of the day, if you’re at work buying for your company, you’re going to do whatever … I hate to say it, but you’re going to do whatever is the easiest for you. If the price is not that big of a difference, you’re going to do whatever’s easiest for you, and maybe not go just by price if the other experience is clunky.

Jary Carter: Well, you’re definitely proving that I think in the customer acquisition department.

Jary Carter: Sean, it’s interesting, you speak at a lot of events. I’ve seen you at a lot of the major events speaking. I think you do a great job at sort of talking to the market about what you’ve done. What are some of the things that you say, really sort of tight bullet points, what are the things that you say when you speak that resonate with people?

Sean McDonnell: Oh man, things that I haven’t said already…I think that I’ve gone through my pitch. But…

Jary Carter: It felt like conversation, I didn’t feel like you were pitching!

Sean McDonnell: I think that really, the key here is to just go into everything from the customer first, and if you can automate processes, even if you have to start from scratch, start from scratch and automate processes because the fact is that you can typically software and systems can allow less people to do a lot more in 2019. And so I really kind of say that talk to your customers, figure out what it is, listen to them, listen to a lot of them, and have someone internally that can have a vision for this that’s outside of how things are traditionally done. And really just try things, break things, and learn from them. I wish I had something more profound to say here, but at the end of the day, just think about it from the customer’s perspective, and you’re going to win.

Jary Carter: I think that’s great. So I’m going to ask you something. You and I have a good relationship, and we’ve worked together for a while. It’s interesting to me that you are in this world of selling forklift parts, except you get a lot of interest from the venture capital community, you get a lot of interest from the private equity community. Is that because they see you doing this sort of disruptive thing, and they view you as a disruptor? I mean, they see your customer growth? Why do you think that is? Does that …

Sean McDonnell: They like for one, the space that I’m in is pretty much eCommerce recession-proof. When the economy’s bad, people don’t buy new equipment, they fix their existing equipment. So there has been steady growth in the industry. Not 50, 60% growth, but steady growth forever. A forklift hasn’t changed in 100 years, so that’s one piece of it. And then obviously, the scalability of my business model.

Jary Carter: And the disruption that you’re actually creating within that.

Sean McDonnell: I’m rewriting what the supply chain looks like. And then the other thing is that forklift parts are just the start. Just because I’ve started with this industry doesn’t mean … I mean, Amazon started with books.

Jary Carter: So you’re just getting started.

Sean McDonnell: Yeah.

Jary Carter: Love that.

Sean McDonnell: And so if anyone doesn’t have the internal person who has the vision, you’re welcome to sell parts through Trupar.com as well.

Jary Carter: I love that, that’s great.

Sean McDonnell: So that’s the interest.

Jary Carter: Okay. So you’re really just getting started, is what you’re telling us.

Sean McDonnell: These customers, these 45,000 customers aren’t just buying forklift parts as their job. They’re purchasing agents, they’re mechanics. These are people who have purchasing power of large companies behind them who are purchasing all kinds of things for their business. And they may buy parts off of me now, but who knows what they’ll buy off me in the future.

Jary Carter: I love that, that’s great. I mean, it’s clear in talking to you that you’re a visionary. I mean, you’re doing something that I think very few people are doing.

Jary Carter: Now, in sort of full disclosure, transparency, you’re an OroCommerce customer. I’m one of the founders of OroCommerce. But I don’t want to talk about this in this question specifically. But my question is, what are some of the technologies that you feel are really critical in running your business? Or, how do you think about technology adoption generally? That is not setting you up to talk about us, I want to hear that kind of broadly how you think about that.

Sean McDonnell: So, OroCommerce is the greatest… (laughter).

Jary Carter: Thank you, Sean!

Sean McDonnell: Obviously without being too pitchy here, I searched a long time for … I have 8 million skus, and there isn’t many platforms on the planet that can actually handle that many skews, unless you’re building it in house custom, and have a lot of money to do it. So I searched for a long time for the right eCommerce partner because that really is my infrastructure. And so once I found Oro, the key was to be able to have a system that had the right roadmap and had the right integrations, and that my business could scale with.

Sean McDonnell: And so that was the Oro choice. And then from there, some of the other keys for me was the CRM capabilities, and then live chat is a big deal for me because it allows, once again, less people to do more. One of my reps can be chatting with multiple people, but someone taking a phone call can only take one at a time. So live chat was a big one. Obviously analytics tools in order to be able to track everything that’s happening, and be able to test things and refine those tests. A cloud based phone system so that I can have reps not only in house, but also remote in the United States. And you can easily transfer calls between, and –

Jary Carter: Tracking, measuring results in what’s happening in sort of your virtual call center.

Sean McDonnell: Exactly. So those are a couple pieces.

Sean McDonnell: What else….can you repeat the question?

Jary Carter: Yeah. Just technology, philosophy, or technologies that you have adopted that matter to you. I think that you hit it. You hit the high notes.

Sean McDonnell: I mean SAAS apps. I think that that’s the big one is technologies that integrate with other technologies because the goal here is to be able to have a 360 view of a customer, and not have siloed systems running. You really want to be able to see a customer from all angles, you want to see all of the touch points, all of the contacts with that customer, and be able to fully provide them the best service possible, and the only way to do that is by having systems that integrate tightly with other systems.

Jary Carter: That makes sense.

Jary Carter: Sean, I want to thank you for joining us here today. Was there anything else that we absolutely should’ve talked about that we didn’t, or you wanted to mention before we finish up here?

Sean McDonnell: No. I mean, keep doing what you’re doing.

Jary Carter: Great!

Sean McDonnell: I’m happy!

Jary Carter: Great. Well, thank you. Thanks Sean for joining us today on the podcast. And thanks everybody for tuning in!

Sean McDonnell: Thanks Jary.

Jary Carter: Thanks Sean.

**TruPar.com has been supplying high quality and affordable materials handing parts since 2012. They now have over 45,000 happy customers and counting. Read their success story here.**