Stoneway rides sales increase
Parts distributor expects double-digit revenue jump, grows high-tech volumeAugust 17th, 2000
Selling electrical parts to contractors and manufacturers has kept the lights on at Stoneway Electric Supply Inc. for years, but a recent surge in sales has given the Spokane-based company an even brighter outlook.
Edward E. Ralph, CEO of the regional electrical-parts distributorship, says the company expects to post revenues this year in the mid-$90 million range, which would be about a 14 percent jump from last years $83 million. Last year, sales went up by a modest 3 percent.
Ralph attributes this years surge in revenue partly to the companys concerted effort to expand its sales to industrial plants and manufacturers, specifically those that buy robotics, computerized process controls, and other types of high-tech electrical devices.
Almost all of the industrial plants are upgrading the processes they have, says Ralph, who founded Stoneway Electric in 1974 with four other owners. Its continually evolving. We have the most popular (equipment), but theres always something new we need to get.
Despite the companys industrial push, its sales of parts to the construction industry have grown almost as rapidly as its sales to industrial customers, he says, and construction sales still account for 65 percent of the companys overall sales.
Even before this years surge in sales, Stoneway Electric had grown to become one of the 100 largest privately-held companies in Washington state, according to a list published in Seattles Puget Sound Business Journal last month. That publication ranks the states privately-held companies by annual revenue, and Stoneway tied for 91st as it debuted this year on the business newspapers annual list.
Also, Electrical Wholesaling magazine this year ranked the Spokane company as the 64th largest electrical distributor in the U.S.
Stoneway has a total of 13 branches and employs 216 workers after adding about 10 people in the past year.
Its lone branch here shares space with its corporate headquarters in a 30,000-square-foot building at 402 N. Perry, where the company employs about 40 workers. Six of the companys stores are located in the Seattle area, and the others are in Richland, Walla Walla, Wenatchee, and Moses Lake, Wash.; Sandpoint, Idaho; and Hermiston, Ore. Those outlets range in size from 12,000 square feet of floor space to 30,000 square feet. The Sandpoint outlet is called Idaho Electric Supply, but the rest of the stores use the Stoneway Electric name.
The stores in Moses Lake and Hermiston have opened within the past year. The company is considering opening new stores in other cities within its trade area, such as Tacoma and Vancouver, Wash., but doesnt have any immediate plans for more outlets, Ralph says. The company hasnt ruled out opening a second store in the Spokane area, he says.
As this community grows, well grow with it, Ralph says.
Stoneway sells a wide range of products to electrical contractors, including control panels, lighting fixtures, wiring, and cabling. For some large construction jobs, Stoneway submits bids to supply needed electrical parts and equipment. For smaller jobs, contractors or subcontractors simply order goods from Stoneway as any other customer would do.
In another market niche, manufacturers and other industrial customers buy from Stoneway electrical supplies for their pieces of heavy equipment. Ralph says the company is a sole supplier for several large companies, including Kaiser Aluminum & Chemical Corp. and machinery manufacturer R.A. Pearson Co., of Spokane.
Although the company is based here, Stoneway has strong ties to the Seattle area. About 60 percent of its sales occur in Western Washington, and some of its corporate operations, including the office of Ralphs son, company President Edward J. Joe Ralph, are located there.
In fact, the elder Ralph and four partners opened the first Stoneway Electric store 26 years ago in Seattle, naming it after the streetStoneway Avenueon which that small, original store was located.
Early on, Ralph and his partners operated each store as a separate company, and Ralph himself, who had grown up in Spokane and had worked here in electrical-supply sales for years before helping start Stoneway, had been operating the branch here. In 1983, however, Ralph bought out his partners, who all were retiring, and began operating all of the stores through one company. It was about that time that Stoneway Electric established its corporate headquarters here.
The thing that Im proudest of is that our two original employees are still with me, says Ralph, who gradually is transitioning into retirement. He says Stoneway Electrics first employee, Jim Tobin, started as a purchaser for the company and now is vice president of purchasing and inventory. The companys second employee, Jack Lamb, started as a warehouse worker and now manages Stoneways Richland and Hermiston, Ore., stores.
In 1995, Stoneway established an employee stock ownership plan through which its employees now own one-third of the companys stock. When Ralph retireshe hasnt set an exact date to do so yethe plans to sell another third of the shares in the company to the employees. He says his son owns the other third of the companys stock.