2013 February - Meet Hugh M. Cunningham Company



Diversified Construction Products Company - The Manufacturer's Representative

For more than six decades the Hugh M. Cunningham Company has supplied first-quality commercial, industrial and residential plumbing and mechanical supplies for the southwestern United States.  Founder Hugh M. Cunningham was responsible for the company's reputation for "honor and integrity" as well as many innovations in the way manufacturers' representatives operate today.  He built the first representative-owned warehouse facility; established educational scholarships; introduced buy/resell arrangements; developed the first architectural sales call program in the industry; and originated many now-standard billing procedures.

Perhaps Hugh Cunningham's greatest contribution was the sense of pride that he passed on to his son.  David A. Cunningham, son of the founder and a talented businessman in his own right, operates the company today.  With over one hundred associates serving muliple markets and its own distribution center, HMC represents many of the premier factories that service the construction trade in a five state area:  Texas, Oklahoma, Louisiana, Arkansas and New Mexico.

Cunningham's original business model was focused on plumbing supplies for residential plumbing; over the years HMC diversified their operations to include divisions focusing on:  Fire & Water, HVAC, and Flow Control.  Their Plumbing and Mechanical Group (PMG) is one of the largest, most established plumbing manufacturers' representative organizations in the country.

The sole focus of HMC's operations is the marketing and selling of its vendors' products to the construction trade they serve.  Every process and every action undertaken is specifically intended to drive sales for HMC's manufacturer and distributor partners.

Incorporating electronic processing of business documents - orders, invoices and shipping notices - became the next logical step in HMC's use of technology.  In 1999 an HMC Vendor, Elkhart Products Corporation, approached HMC about an opportunity to be part of their cutting-edge Vendor Managed Inventory (VMI) program.

With VMI the manufacturer is responsible for maintaining the distributor's inventory levels.  The manufacturer is given access to the distributor's inventory data and automatically generates POs when inventory levels are low.  To comply with this request HMC implemented an EDI program - sending daily EDI 852 (Point of Sale) reports on quantities of products sold, on-hand, and backordered.  Elkhart uses these data to assess stock levels, creating a PO in their system if the stock is low, and automatically shipping product to HMC to keep inventory levels stable.  When HMC demonstrated that they were EDI Capable the program launched.  Soon HMC was able to honor a similar request for VMI from another supplier, Charlotte Pipe and Foundry, also enhancing that business relationship. 

Expanding on this technology in 2000 HMC started another stand-alone business unit called the Distribution Group.  Using a radio frequency scanner and bar-coding inventory system this group is able to electronically process order acknowledgements, automatic shipping notifications, and carrier ship tracking.  The high perfomance, paperless system has allowed the warehouse to be re-engineered for maximum productivity.  Using handheld scanners and bar codes, it delivers a flexible, real-time process that boosts productivity, reduces costs, shortens order fulfillment times and increases customer satisfaction.

Cunningham is notified via EDI when orders have been shipped, creating POs in their back-office system, Infor's TakeStock.  When shipments arrive, the radio frequency technology is able to quickly receive the items compared to the PO.  Any exceptions are noted via email to the appropriate person.  Every aspect is coordinated:  the internal PO lists items in the same order as the packing slip, etc.  This tight inventory control has allowed HMC to be able to boast a 100% customer satisfaction rate.

Demonstrating this capability for EDI has provided HMC the opportunity to become a major distribution center for both Elkhart and Charlotte Pipe products deepening both business relationships.  Recently HCM leveraged their EDI investments and extended their ten-year relationship with Little Giant (now owned by Franklin Electric) by implementing integrated outbound EDI POs.

Internally the ability to handle outbound purchase orders electronically has reduced staff involvement (saving costs) and resulted in 99.9% error-free orders going out from the warehouse, according to Debra Dingess, IS Manager.  The savings in PO entry alone has been amazing, she says, since many of the orders have more than 150 lines.  "Doing EDI is cost effective," says Dingess:  it's less cumbersome, more efficient, frees up employees' time, reduces errors, and simply costs less.  Employees love the efficiency and accuracy of EDI, Dingess says, adding, "The more partners on EDI, the better."

In interviews with new manufacturers about carrying their lines, HMC brags about their EDI capability and vendor managed inventory successes and the benefits they can offer to new relationships.  They have found EDI capability to be a huge selling point.  Because Cunningham sees their role as true representatives of their vendors, they take pride in being able to comply with and build on vendors' requests.

Hugh Cunningham is justifiabily proud of their reputation as a manufacturers' representative and is looking forward to using their EDI capability to expand the company's opportunities more with vendors and customers too.

To learn more visit HMC's site at: http://www.hughcunningham.com/





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