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HARDI’s Evolution and What’s Coming Next

Nothing ever comes easy, and nothing ever goes exactly according to plan. That could certainly be the motto for most businesses, regardless of whether they’re established enterprises or just starting out.

It should come as no surprise then, that the association known as HARDI (Heating, Air-conditioning & Refrigeration Distributors International) can sing a similar tune.

Launched in 2003 as the result of a merger from long-standing organizations ARWI (Air-conditioning & Refrigeration Wholesalers International) and NHRAW (Northamerican Heating, Refrigeration & Air-conditioning Wholesalers), HARDI’s journey is one of perseverance, and sometimes, of re-orienting the ship.

“There were many attempts to merge these two organizations,” says Doug Young, HARDI’s first president and current president of Behler-Young. “I believe the merger was attempted seven times and finally on the seventh try, it was successful.”

For HARDI, that seventh time marked the beginning of a new era, one in which the two organizations admitted that the time had come to begin working together, rather than competing against each other.

But that doesn’t mean the road to HARDI’s current membership – 480 wholesale distributor members, and approximately 1000 total members – was paved with rainbows and hand holding.

Young remembers the first several years to be quite challenging, as the association worked to meld two organizations and cultures. “There was a tremendous amount of energy on both sides to make it a success,” he says.

Fortunately, seven turned out to be HARDI’s lucky number, and where other organizations may have faltered, HARDI only continued to gain traction. By the time Talbot Gee, HARDI’s current Executive Vice President, came to the association in 2006, most of the heavy lifting was done.

Gee says that now, the organization is clearly one culture, which has enabled it to focus its attention on the betterment of the industry for its wholesale distributor networks. This support and betterment was always a key focus for the association, but in 2006, another avenue opened up purely by chance.

“I would love to say it was some brilliant strategic plan that got us involved in the government affairs,” says Gee. “But truthfully, it was purely defensive.”

By 2010, HARDI was so deep into regulatory and legislative affairs, they hired Jon Melchi, the association’s first government affairs employee. From there, the implications of HARDI’s political involvement snowballed.

Now, Gee says he would venture to guess that if HARDI announced tomorrow that it was out of the government affairs business, there could be a violent rising from the membership.

“It’s gone from something that was never even considered as a role for HARDI to possibly one of our highest value propositions,” he adds.

Royce Henderson, president of HARDI for 2014, and the president of Charles D. Jones Company, echoes Gee’s sentiments:

“HARDI has been in the middle of the negotiations on Regional Standards on Equipment with the Department of Energy and with R22 allocations with The Environmental Protection Agency,” he explains. “Along with the guidance of the HARDI board, Jon Melchi was instrumental in negotiating a settlement with the DOE that had the best outcome we could have hoped for in the industry and for wholesale distribution.”

“We challenged a regulation from the Department of Energy, and we were able to reach a settlement with the government which provided relief to our members,” Melchi adds.

But before we get too off track, it’s important to remember that while HARDI has played a crucial role in policy, it was formed initially as an educational organization – a mission and vision set during a landmark strategic planning initiative spearheaded by 2009 president, David McIlwaine. Those educational-based values and goals are something that’s still alive and well within the organization today.

Along with investing heavily in benchmarking – McIlwaine, who also served as Management Methods Committee chair during much of this expansion, says he would argue that some of the best industry analyses coming out from anywhere is coming out of HARDI – the association has also completely revamped their professional development programs.

Around 2006, McIlwaine says HARDI leadership began to recognize that much of the information available was outdated, and that HARDI was starting to lose its standing as an educational resource.

“We were extremely fortunate to find Emily Saving to rebuild and re-launch our entire professional development program with things like the Branch Manager Certification program, the new version of the Counter Certification program, and now this fall, the new Sales Manager Certification program,” he says.

The hard work by the Professional Development Committee and Saving seems to be paying off. On HARDI’s last board call, leadership announced that half of all members are engaged in some way with the professional development program, something that Gee says is rare in the association world.

Another opportunity to engage with members is through the regional and annual conferences, held throughout the year in different regions of the country.

“Our Focus Conferences are open to every member and deal with four areas of need within the industry: operations and logistics, sales and marketing, purchasing, and strategic leadership,” says 2012 president, Bud Mingledorff, who oversaw this transition away from the traditional regional meetings. “Since we started just two years ago, we’ve more than tripled the distributor involvement and engagement in those conferences, so they’ve just been a huge success for us.”

As for the annual conference in December, Henderson says it’s something that’s always been good, but now it’s evolved into a first class event with great stage set-up and lighting, well-known professional speakers who are experts on their subjects, and even celebrity keynotes.

Mingledorff says that additions like the Distributor Town Hall have also helped to elevate the conference to the next level. “It’s one of the only times of the entire conference where it’s a distributor-only audience. The idea here is for our leadership to get a sense of the distributor membership,” he explains. “We’ll bounce off major policy issues or maybe strategic issues that the leadership has identified. It’s a great sounding board and an opportunity for our members to be vocal about what’s important to them.”

Looking forward, HARDI’s focus at this year’s conference is to best prepare members to take full advantage of the growth forecasted by HARDI’s economists in the upcoming years.

“The biggest trend we’re seeing in wholesale distribution right now is, for lack of a better term, the maturation, evolution, maybe even corporatization of our wholesale distributors,” says Young.

He goes on to say that what was historically a collection of family businesses serving very localized networks has now grown larger.

“They’re serving more markets, they’re juggling more vendors, and they may have more diverse customer bases than they’ve had in the past. We’re seeing a lot of wholesale distributors at a fork in the road,” he adds.

That fork means businesses need to start making changes if they’re going to continue to grow, or have a hope of surviving the growth. Thankfully for its members, HARDI has positioned itself to stay on top of the trends and has built a staff that’s able to help with many of the issues plaguing distributors.

“We’ll continue to try and be the tip of the spear to help the most engaged distributors really know what’s coming so they can win in the end,” Henderson says.

HARDI’s annual conference takes place December 6 -9, 2014 in San Antonio, TX. 

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