Winning the Marathon
One distributor finds its stride after a challenging start
When Art Stengel graduated with a degree in finance from the University of Connecticut in 1976, the job market looked pretty bleak. In fact, the unemployment rate was worse then than it is today, he notes. So, when the opportunity arose to purchase a small diamond bur business for $16,000, he grabbed it. "It was either take a risk and purchase the business, or sell life insurance," he says. And, the latter was not an attractive option, he adds. With only $2,000 in savings, Stengel was forced to borrow $10,000, for which his stepfather co-signed. "I also took a $5,000 loan from my good friend, Chris Dahn. Without this loan, I never could have gotten started in business." Not only did he get his start, he also established a strong foothold in the industry. Today, Hamden, Conn.-based Dart Dental Supply is successfully approaching its 35th anniversary.
In the early days, Stengel lived and ran his business out of his parents’ home. Over the years, he moved a handful of times – first to share a house with a couple of buddies and later to a home of his own. Throughout his moves, he continued to use his home as an office, a warehouse and a distribution center. After all, establishing a business in a recession was no easy feat. "I had to paint houses on the side to make ends meet," he recalls. "It took me 10 years to sell the original inventory."
Within two years, Stengel purchased a second company, Cort Dental Supply. Ready or not, it was a strategic move he had to make. "If I hadn’t done so, I would have gone out of business," he says. "The new company helped us branch out into dental labs and acquire some big dental product lines.
"At the start, we didn’t have a mission," says Stengel. "It was all about survival. Each day, we had to do certain things to keep the business going, [including] picking up products in my van and making deliveries to dentists. My father was very apprehensive at the thought of me purchasing a second business. I still hadn’t paid off my first business and I hadn’t paid myself yet!" But, Stengel persevered, even bringing his mother on board in 1979 as a bookkeeper. Then, in 1984, he hired his first employee, Peter Tomasulo. "Peter would show up at my house and work," says Stengel. "Today, he is the company vice president."
"I operated out of my home until 1988, when I got married," says Stengel. "Then, I acquired an 1,800-square-foot facility in North Haven, Conn. That changed everything," he points out. "Once I had a warehouse, vendor deliveries could be dropped off there. Before that, whenever an order was too costly to ship or couldn’t be delivered by UPS to the house, I would have to drive to a truck stop and pick it up. [I remember driving] to Edison, N.J. (2 ½ hours each way) to pick up 4,000 pounds of gypsum!" But, that’s what it took to stay in business, he explains. "I’d make my sales calls until 4 p.m. or 5 p.m. and then drive through traffic to pick up my orders.
Bigger and better
Over the years, Stengel continued to expand his business, moving from his 1,800-square-foot warehouse, to a 4,000-square foot facility and so forth. Today, Stengel has expanded to a 15,000-square-foot warehouse. And, although he has three dedicated field reps and three service technicians, one of whom also sells in the field, Stengel continues to call on customers as well. "We have always offered free delivery on all of our products," he says. "We have a fleet of 12 vans and deliver 99 percent of our orders the same or next day, or by customer-scheduled appointments. And, all of our deliveries are made by Dart-trained representatives who truly know the products. This is our niche," he adds. "The fact that we have our experienced reps make personal deliveries [allows] us to provide same-day service within a 50-mile radius.
"Our representatives unpack and stock deliveries, taking products, such as gloves, from the master case, placing them on the shelf and taking the trash to the dumpster," he continues. "They inventory products and [take note of] when the customer will have to replenish supplies. Our customers rave about the time we save them."
Although 80 percent of its customers are in Connecticut, Dart Dental Supply also services customers in the greater New England and New York area.
Not a sprint, but a marathon
Running a dental distributorship is much more difficult today than it was years ago, Stengel says. Particularly as the larger distributors gain more market share, the competition continues to grow, he points out. "As difficult as it was for me to get started, I think it would be even more so for those starting out today," he says. "When I entered the market, I was young and single. And, many customers relied on mail order delivery, whereas I could provide more personal, face-to-face service. We don’t have as much mail order in the industry today, making it much tougher for someone to successfully launch a dental distributorship."
That said, it can be a struggle for established small independents as well, says Stengel. "Dart Dental only offers a few thousand items, so we can’t fulfill a dental office’s complete needs. But, we know our limits and stress what we do better [than other distributors]. We deliver the highest level of personal service and can process credits as fast as we process orders. Many companies can’t do this." Not that returns happen often, he adds. "But when they do, we can address them."
In 2007, he purchased Desco Dental, an equipment and service dealer. "Before that, we sold supplies for 31 years. But, I felt we needed to expand into equipment and offer our customers equipment servicing. This was necessary to remain competitive and continue growing. And, if your company doesn’t grow, it can die."
Indeed, after paying off his debt from his acquisitions, Stengel operated his company debt-free, he points out. "Just as I didn’t pay myself a salary for the first three years I was in business, I always believed in leaving most of the company profits in the distributorship to build cash reserves. That way, when an opportunity became available, I could strike. It’s not about luck but about being prepared and ready to take advantage of opportunities when they present themselves." Dart Dental has seen growth in all but one year. In 1976, it was less than a $10,000 company. Today, it is over $5 million.
When business is strong, company morale is up, Stengel says. "In order for employees to grow, the company must grow, and vice versa," he says. "This must be a team effort." Employees must feel they are a part of the company in order to stay motivated to help it move forward, he adds. "I try to continually expand my employees’ responsibilities to keep them motivated."
In retrospect, Stengel would not have done anything differently when it came to growing Dart Dental. "Running a distributorship is not a sprint, but a marathon," he continues. "You take it one step at a time."
Editor’s note: In 2007, Art Stengel was inducted into the University of Connecticut Business School Hall of Fame. Of the 30,000+ individuals alive today who have graduated from the business school, only 110 have been inducted into the Hall of Fame. First Impressions congratulates Stengel on his notable accomplishment.
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