Over the past 25 years, New Jersey-based P&N Distribution and Rheem have grown together in the mid-Atlantic region: a distributor that began as the idea of four industry veterans and a well-respected equipment manufacturer that had little presence in the area. With the commitment to customer service and technical know-how of P&N Distribution and quality products from Rheem, both distributor and manufacturer have become a force in the area for dealers and their customers.

P&N Distribution was the idea of four veterans from different segments of the HVACR industry who wanted to have a distribution business, says Lloyd Larkin, Jr., P&N Distribution's president and one of the four founders. Larkin's father, Lloyd Larkin Sr., and Hagop Kouyoumdjian had already established a successful export business with Rheem air conditioning, while Fred Hagee came from the engineering side, and Larkin Jr. worked for Honeywell. The quartet founded P&N in 1984, pooling their expertise to form a wholesale distribution business in a very competitive market area. Hagee passed away in 1997, while Larkin Sr. and Kouyoumdjian are still active on P&N Distribution's board of directors.

Knowing that Rheem was a well-respected brand in HVACR, the partners became the Rheem distributor for the region and built it up from there. There are now four P&N Distribution locations, and its market area covers southern New Jersey, northern Delaware and eastern Pennsylvania. P&N Distribution has a staff of 38.

“Rheem is a first-class line of equipment that is well-respected and offers high-quality products,” says Larkin of Rheem and why they chose to distribute its products. Because Rheem continues to innovate and bring new products to market, Philip Debes, P&N Distribution's vice president of sales, says they've put total focus on one equipment line. “We're not big believers in trying to promote two equipment lines,” he says. “We focus on one line, and our goal is to switch existing accounts to the Rheem brand.”

The mid-Atlantic region where P&N Distribution operates is a crowded and competitive market. As Larkin puts it, “Everybody's here, and they're close.” So how does a distributor build a name for itself? Steve Fraser, vice president of operations, has a simple explanation: “Going from zero to what we have today was built on good, old-fashioned service for the customer,” he says. “That's gotten lost over the years, but we've always put an emphasis on this — making sure that whatever the customer needs, we'll be there for them.”

What the customer needs is the philosophy that P&N Distribution follows in how they do business. For example, when it puts together its training schedules, it asks customers what they're looking for. What are the issues that they're currently facing, and how can P&N Distribution help them? “We'll do training on Rheem products as well as other products, and we're a NATE testing facility,” Debes says. When it comes to deliveries, P&N Distribution makes sure that it gets product to customers when they need it — even, if possible, if it's for that same day. “And it's not beyond our salesman to drop a coil or part in his car and deliver it to the customer,” he adds.

Because they are so responsive to the needs of dealers, P&N Distribution offers free next-day delivery, and it has distinguished itself from its competition. There are four fully stocked warehouses that allow the business to get its products in the hands of dealers quickly and on time.

When setting up the business, the partners decided to locate in New Jersey, in contrast to many of its competitors who are across the Delaware River in Philadelphia, Fraser says. “They started with the headquarters in New Jersey, and I think that really had something to do with the growth in the beginning,” Fraser says. With two branch locations in Pennsylvania, it allows P&N Distribution to cover eastern Pennsylvania well, “but in the beginning it was a good move to set up in New Jersey,” he adds.

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Then there is the technical know-how that the P&N Distribution staff brings to the products. Because the distributor focuses primarily on air conditioning, its field staff has the expertise with these lines, and they go above and beyond to work with dealers and contractors when issues arise. “It's a customer-first attitude, and that means whatever we need to do,” Larkin says. “Whether it's training, the way we deliver or do anything in the company, we always ask: What's the best way for us to do this for the customer, and what do they want to see happen?”

Demonstrating the close relationship that Rheem has enjoyed with P&N Distribution, it became one of the first distributors to take part in Rheem's new wholesale store concept and product line about six years ago. Called the prostock wholesale concept and with the protech product line, it was introduced to strengthen its offering to distributors and HVACR contractors. Designed as a color-coding system, it divides HVACR parts into easily identifiable categories, making it easier for both contractors and distributors to improve their efficiencies in keeping inventory, stocking product and finding the right part for the job when they need it.

The addition of supplies and accessories in this format enabled P&N Distribution to become a true one-stop supply house for customers. It offers a comprehensive line of parts, accessories and supplies not only to Rheem dealers but to all HVACR contractors. “It sparked a lot of growth and interest and new customers,” Larkin says. “It allowed us to have a professional, self-service-type program in our store.” In addition to the design, Rheem also marketed P&N Distribution and its participation in the prostock concept to contractors, driving more traffic to its locations. There are now more than 100 Rheem prostock distributors around the country.

P&N Distribution is also participating in Rheem's DesignStar home comfort system customization tool, introduced last year to help contractors win new customers. DesignStar is a program that allows a contractor to input some key data and then provide a homeowner with a range of home comfort options. For example, it allows consumers to compare the cost of repairing an existing unit with the cost of replacing it with a new unit. DesignStar also calculates the operating costs and cumulative savings of different units. It even calculates monthly payments and interest for homeowners who may want to finance their purchases.

Recognizing that DesignStar could help P&N Distribution's customers sell more Rheem products, its staff worked closely with the contractors to educate them on DesignStar. The program is a very powerful sales tool that helps end- users make better-informed decisions while positioning the contractor as someone who is working with the customer and not just trying to sell them a box.

“What's so unique about DesignStar is in a very short period of time — perhaps two or three minutes — these guys can input some information into a website, and the output they get is a very professional proposal to the homeowner explaining exactly what equipment they're going to be installing, as well as how much they can expect in savings, a return on investment and, for those who are environmentally aware, how many pounds of carbon they're going to save,” says Debes, who has worked directly with contractors on the program.

DesignStar is another way for Rheem and its distributors like P&N Distribution to make its customers better on the marketing and sales side of the business. “This helps them to upgrade their sales efforts,” he adds. For P&N Distribution's customers, the program has been successful. Already, 43 contractors have signed up for DesignStar. Those who use it consistently report that they have closed more sales, and those sales have been on higher-ticket systems. “Everybody wins,” says Debes. “The customer gets a higher-efficiency system and greater comfort, while the contractor wins because it took him the same time to put it in, and he made more from the sale.”

P&N Distribution also touts DesignStar to its customers as a lead generator. Homeowners who are in the market for an HVACR system can enter their information on Rheem's DesignStar website (www.rheemdesignstar.com) and download their own proposal to see how much they're going to save. When a homeowner enters their ZIP code, the website displays the DesignStar contractors in the area with links to their individual sites. P&N Distribution is encouraging its customers to establish websites as another way for customers to get to them. As Larkin says, marketing and advertising have changed, and P&N Distribution is committed to working with their contractor customers to keep them current on staying close to their customers and potential customers.

P&N Distribution has made a major push in the hydronics market over the past four years with its Rheem water heater product line. “It has the same support and backup and product quality from that division,” Fraser says. “That has led us into more of the hydronics, and that in turn has led us to boilers. They are the market leaders.”

P&N Distribution has relied on HARDI as a valuable tool for industry information and networking. “It's fantastic,” Larkin says. “We go to their meetings every year, and there's always good product information and educational opportunities,” he says. “We learn what others are doing, and we're always coming up with new ideas.”


Michael Maynard is a business writer based in Providence, R.I. He writes frequently on HVACR, construction and architecture issues. Contact him at michael.maynard@lycos.com

Best Practice

Definition: All of our employees are committed to providing maximum support to the contractor. We offer this support with accurate order entry, prompt delivery, training on many product lines, technical assistance, sales and marketing programs, salesperson support, advertising co-op and extensive HVACR experience.

Example: When we introduced DesignStar to our contracting base, we had meetings at each branch location to show our contractors what DesignStar is and how it works. Once the contractor signed up for the program, we provided training to the contractor and their salespeople on how to use DesignStar, how to interpret the output from DesignStar and how to present the information to the homeowner. In addition, our salespeople helped the contractors set up their DesignStar account and do their first few jobs on DesignStar. Lastly, our salespeople actually went out with some contractors to help present the information to the homeowner. We did all of this to help the contractor to become familiar with DesignStar and comfortable explaining the information to the homeowner.

Significance: By providing all of this support to our contractors, they have more time and better tools to work on and improve their business. Our sales and marketing programs help them get more leads and close more jobs. Our training helps them to install jobs quicker and with fewer callbacks. Our inside and outside sales team and delivery help to make sure that job installations occur on time.

Benefits: By helping our contractors grow their business profitably, we are also helping our long-term goals of growing our business. If our contractors remain strong, we will also be strong.

Contact: Phil Debes, pdebes@pndistribution.com

P&N Distribution at a Glance
President: Lloyd Larkin, Jr.
Vice Presidents: Phil Debes (sales), Steve Fraser (operations), Hal Morris (marketing)
Headquarters: 306 Connecticut Dr., Burlington, NJ 08016
Operations: 4 Locations
Employees: 38
Annual Sales: $23 Million
Major Product Lines: Rheem HVAC, Rheem water heaters, Peerless boilers, LG ductless, Lukjan metal
Website: www.pndistribution.com
Year Founded: 1984