Spencer, Iowa--E.P. Arnold, founder of Arnold Motor Supply, started a business that has spanned eight decades. "This business is operated under the same philosophy Mr. Arnold had in 1927 – 'You build a business with people, not bricks and mortar,'" said Dennis Spooner, president and managing partner of Arnold Motor Supply.
"He was a man who felt that there were two important people in his organization," Spooner said; that was, and is today, the customer and the employee. Arnold handed down a legacy that allowed his employees to be successful by becoming partners--to share the joys and profits of ownership, he said.
Having endured and prospered for more than three quarters of a century, Arnold Motor Supply has grown into a multidivision business that employs more than 500 people, Spooner said. "There are more competitors and fewer customers," he said. "Yet we have made an impact in our trade area. We have diversified with businesses that have synergy with our main business."
In the 1960s, Arnold Motor Supply stores numbered 10, and the size of the organization dictated that a warehouse operation would improve profitability, Spooner said. The company built a 27,000-square-foot building on farm ground in south Spencer. Originally called Arnold Motor Supply Warehouse, the name was later changed to The Merrill Co., after Arnold's son.
Spooner also said that Arnold set about to guarantee the survival of his company in 1966, he opened the partnership up to everyone.
"He also set into motion a management structure that is still used today," Spooner said. "A general manager, now referred to as president and managing partner, is responsible for the entire company. A senior partner group aids him with the large business decisions. These individuals represent the regular partners and are chosen for their dedication to the company.
"We are unique to the aftermarket because we are a partnership," Spooner said. "Over 165 of our more than 500 associates are owners of this company. Many of the pay schedules developed by our founder over 70 years ago are still in place today. "Family was important to Mr. Arnold, and our current leadership has embraced the same principle of taking care of our team members," he said. "Accordingly, many of our partners and associates have been with us for most of their working lives, and now their children are partners and associates."
Spooner said the company not only continues to succeed at selling vehicle replacements parts, but has grown through careful planning, and research. Its commercial-coatings division is one of the largest in the United States, he said.
There are 21 machines shops in the company's retail stores, and it also owns and operates Midwest Cylinder Head, an engine remanufacturer in Nevada, Iowa. That segment of the business is bucking industry trends by growing nicely, Spooner said. The company added Arnold Group Equipment in 2006 to focus on large equipment and service for the refinish and industrial coatings market, he added.
In the last 10 or so years, Arnold Motor Supply has continued to expand the hard-parts segment of its partnership with the addition of Specialty Sales and Undercar Warehouse in Omaha, Neb., an Auto Parts Warehouse in Rock Island, Ill., Spooner said. In 2006, the company was ranked by Automotive Aftermarket magazine as the 19th-largest auto parts chain in the United States, he said.
Technology has permeated the auto parts distribution system, said Dave Kimbell, marketing manager of the Arnold Group of Cos., which includes Arnold Motor Supply and The Merrill Co.
"We embraced online ordering for our installer customers, and we are embarking on an aggressive timetable for converting all of our stores to graphical user interface (GUI) hardware," Kimbell said. "We also use our Web-site to sell products that promote our business, and we use the Web for voice-over IP." He said the company just installed a video conferencing system for training and meetings.
In 1984, Arnold Motor Supply became a shareholder in Auto Value, which later became Aftermarket Auto Parts Alliance and is one of the largest auto parts distribution and marketing organizations in the world, marketing under the Auto Value and Bumper-to-Bumper brands, Spooner said. The management of the Arnold Group of Cos. works very closely with the Alliance. Kimbell is chairman of the training and education committee and secretary of the Alliance marketing board; the company's CSC coordinator, John Koch, is on the Alliance service dealer committee.
Spooner and Kimbell agreed that the goal of The Merrill Co. and its associated divisions is to build on the concept of increasing sales and profits through training, marketing, and improving operational efficiencies. "We expect that the people from whom we purchase products to perform as partners with us so that we both can benefit from increased sales," Spooner said.
"Because people still buy from people," he said, "we constantly make an investment in our team, so that they are the best that they can be.… This attitude is a tenet of our constitution on customer service. Since people are vital to our organization and our continued success, we feel our 80th year should be heralded as one that sets a new course. We want to be here another 80 years."
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