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Last Update: Thursday July 29, 2021

Key Idea: Respect Technology

Ironbound has always used technology to run its business and now it puts technology to work to track inventory, generate sales and determine profitability.

Key Question:


Howard Kent studied business in college and left his job as an automation specialist in a big company to go to work for his father-in-law. He knew from his studies and experience that he could use computers to streamline business functions. Today this sounds so "ordinary" because everyone is using computers. However, Howard has had the goal to work efficiently for 30 years. This mindset has kept him current on technology and software solutions and the enhanced capabilities each brings to business. He was an early adopter of the integration of his customer/prospect database and an automated fax program that generates sales leads and sends out customer support information, all while he sleeps.

Q: Why is technology important to small businesses?

A: By using it, you can look and operate like a big company. Today's desktop computer has more power and capacity than computers that took staffs of 30 people to run as recently as 1980. Software programs can be purchased to do repetitive tasks that formerly took entire departments of employees. What has become a truism, as futurists once boldly told us, is that technology is leveling the playing field between large and small businesses. We also now know it keeps extending the playing field and changing the ground rules. Prior to 1994 and the introduction of Mosaic (and soon Netscape) people would call you crazy if you said you could open a business within 24 hours with less than $1000 investment, and then have a presence in every major city of the world, 24-hours-a-day, seven-days-a-week.

Today, hosting services make a web presence viable for even the smallest companies. Bill Gates, in Business @ The Speed of Thought, said "The successfully companies of the 21st century will be the ones who use technology to reinvent the way they work". The key to this success is to recognize that technology is an enabler, not a solution. Technology can be harnessed to improve your business processes. Howard Kent has moved well beyond simply using technology in his own business.

Remember the new product designed by Tom? It was an "actuated" valve, opening and shutting as necessary, powered by a processor. How do you think the market will receive Ironbound's latest innovation? Let's see, requires no human intervention (that means no payroll cost!), works 24X7, and never makes an error. Hmmm…that should sell!

Q: How does a small business decide what investments to make in technology?

A: Investments in technology should be made based on the same criteria of any other investment, what is the anticipated return? Like Howard, any small business can invest in technology to improve its own internal business processes and/or to improve the products or services the business brings to market. The important point is to make those investments that will improve your bottom line. Networking all your computers is a relatively inexpensive endeavor today. But don't network just to network. What would be the benefit, in your business, of a common operating environment where everyone could share files and information based on security levels you would assign? What would be the cost? Does the benefit in increased employee productivity exceed the cost?

Think about it

How can you use technology to improve your business processes and/or the goods and services you sell? What would the technology cost you, how will you fund the purchase, and what is the anticipated return in terms of dollars and payback period?

Clip from: Ironbound Supply

Newark, New Jersey: Meet Howard Kent and his team at Ironbound Valve Actuation. Like most of us, he learned his lessons the hard way. He now says, "Plan your work. And, work your plan, so . . . when you do succeed, it's not by chance and it's not by luck; it's just that you followed your game plan."

As you can well imagine, to go global, Howard constantly streamlines his systems with a mixture of old technology and new.

Go to the key ideas of this episode...

Ironbound Valve Actuation

Howard Kent, Chairman, CEO, founder

146 Jackson Street
Newark, NJ 07105

Visit our web site:

Office: 9735895209

Business Classification:

Year Founded: 1966

Respect Technology

HOWARD: This building has got to be over 100 years old.

HATTIE: (Voiceover) Even though he left a job and a big company behind, Howard has always looked for ways to treat his small business like a big business, especially when it comes to technology.

HOWARD: Well, I used the technology when we first went in business to try to get rid of writing an order on a piece of paper and a pad, try to get that automated as much as possible, because being the only employee, I wanted to be able to do as much as I could as quickly as possible, as efficiently as possible. So I looked to technology, a small computer or whatever, to aid me to do it that much faster.

One of the major changes that we did after selling the same commodities, which I've said many times, pipe valves--and they've been the same for 30 years--the only thing that's changed on that is the marketing of it. Years ago, we still sold it one on one, face to face, a piece of pipe; you're putting up a building, fine. But with the advent of computers and advent of telemarketing, we can now find out how much we have in stock instantly: How much did we sell of this item year to date? This year? Last year? Are we increasing our sales of this? Decreasing our sales of it? What's the cost? Keep track of it any way we want. We can tell when a customer last bought it: How much did they buy? How much did we make from them? When did they use this item? Is it as seasonal item? This has enabled us to cut our inventory by a third, increase our delivery time--I mean, turnaround time--to a customer, getting them the material that much quicker, that much more efficiently, and yet decrease our inventory so put that money to work someplace else.

Through the advent of the computer, we do telemarketing, faxing out to customers nightly, by SIC codes, not selling the material, just letting them know who we are and what we have to offer.

HATTIE: One SIC code gets XYZ message; another SIC code gets ABC message and it's faxed to them overnight...

HOWARD: Overnight.

HATTIE: a low rate.

HOWARD: A low rate and...

HATTIE: And your machine does that for you.

HOWARD: Machine does it all for us, so overnight we've contacted 200 customers for about $15. And the next day, we have a receipt saying that it was either received or it doesn't--wasn't received; you know a fax was read and you've reached a couple hundred customers, or potential customers, overnight.

HATTIE: So you've tracked that and you know you're getting business from it.

HOWARD: There's no a--question. We've got good responses from it. Customers either say, `We need your services, send a salesman,' or in many cases, it's led to an on-the-spot order, where they need the services immediately, we can turn it around and do it for them, and we've got the order. So that is something that a couple years ago was not available to us. And now with the technology advances that we've had in the last five, six, seven years in PC computers, it's unbelievable. They can put the cost of-- any small business owner now can buy a PC for $1,200. That's enough to help run the business and then get some software in there and program and custom tailor it to keep track of the business very quickly.

In the Studio

HATTIE: Howard Kent has been selling the exact same products for 30 years. Yes, he's added some new bells and whistles, but basically the pipe valve and fitting business hasn't changed much. What has changed is the way he sells pipes, valves and fittings. His infrastructure is a small but powerful computer. He and his salespeople use this hot technology to stay on top of customers and prospects and even anticipate their needs.

For example, the computer sends out 200 faxes every night. Each customer's buying history and their fax numbers are entered into the system. And the computer knows who should receive what messages and when. Doing $3.5 million in sales isn't easy, even if you've been in business for 30 years. Take it from Howard Kent, you must find ways to keep your name in front of even the most loyal customers and find new customers and invest in technology. He's already on the Internet selling pneumatic pumps. And what was once a local, simple business, is now dependent for survival and growth upon technology and going global. Let's go to his Web site.

HOWARD: (Voiceover) As far as I'm concerned, a Web site would be good if you had a totally unique item that you would like to sell; then you get a Web site. But if you just want to say, `I have a Web site,' and look at yourself up there it's not gonna do anything for your business.

Because if you're selling a toilet --a white toilet and you look on the Web, there's five million people selling white toilets. But if you're looking for a specific brand and a specific color that's very unique, now something like that on the Web can bring a buyer right to you.

HATTIE: We are glad you are visiting us in cyberspace. Be sure to work through some of the steps to starting or growing a business. And register!

(Voiceover) In Howard Kent, I found a man who has balanced high-tech with high-touch. Technology is important, but he still believes that the people in the company are its most valued asset.

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