President Brian Gallogly (left) says Quantum Automation forms strong relationships with customers.

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Quantum Automation does more than distribute parts for automation systems, according to President Brian Gallogly – it distributes the knowledge and expertise customers need to put those components to their best use. Gallogly started Quantum Automation in 1991 and received purchase orders from some large clients within two months thanks to the knowledge he brought as a former member of the General Electric and Texas Instruments organizations.

That business model is still in place throughout the entire organization today, as Gallogly stresses the technical expertise his employees provide in support of the diverse product lines Quantum Automation offers. “Most of the people who work at Quantum Automation are either mechanical, electrical, or instrumentation engineers,” he says. The company fills an important niche in the electrical industry with enormous growth potential and is already being seen as a role model by other distributors, he adds.

Based in Anaheim, Calif., Quantum Automation serves as an industrial control solutions provider for 11 western states. The products it carries range from AC motors and relays to software and operator interfaces. Gallogly founded the company with $50,000, and originally focused on providing distribution of control and automation products in Southern California. He says the knowledge of product lines he developed during his time with GE and Texas Instruments proved to be crucial in the company’s early success.

Quantum Automation differs from other companies serving the same markets because of its narrow focus, Gallogly says. Standard electrical wholesalers typically represent one many lines and sell all electrical parts including wire and conduit. “What we do differently is we focus on the control and automation aspect,” he says.

Sales Knowledge
This focus is what allows Quantum Automation to provide more than just components to its customers. Because it concentrates specifically on controls and automation, the company’s employees can specialize their knowledge and get into more detail with customers about the products. This means that Quantum Automation’s salespeople not only help customers find the parts they need, but they can also help them increase productivity by optimizing those parts to their specific operations.

“It’s the fact that we have the ability to train customers on the software as well as help them engineer the products into their control systems,” Gallogly says. “Rather than just being order takers, we’re order makers.

“There are some other distributors like us around the country, but a lot of the other ones tend to rely on the manufacturers for support, whereas we do a lot of support ourselves,” he adds.

The company motivates its salespeople to focus on more than just the sale, and to concentrate on forming strong relationships with customers. “I’ve tried to create a bunch of rainmakers in our regional sales managers, and they all work on straight commission, so they tend to be more motivated to help the customers to generate new business,” Gallogly says.

Direct Partnerships
Quantum Automation is even starting to bring its expertise and knowledge into partnerships with other distributors. For example, the company has been working with Automation Direct, a master distributor of control equipment based in Georgia for 15 years.

According to Gallogly, Automation Direct didn’t have much experience working face-to-face with customers. Joan Welty, marketing manager for Automation Direct, says the company used to rely exclusively on mass advertising and catalogs for its nationwide sales regardless of the customers. Automation Direct has sold through a limited number of value added resellers, including Quantum Automation, since its inception.

Welty says the company wanted to change its approach and spend more time working face-to-face with larger clients, but did not have the experience. “Having a value-added reseller in various parts of the country made sense to us,” she says. “They would go after the types of customers we couldn’t reach.”

Without the intervention of Quantum Automation, Welty says, Automation Direct would be without a number of major clients. “We would probably not have as many large customers in the western region,” she says. “Those are customers that would just be very difficult for us to reach. We ourselves have a very wide customer base. We have literally thousands of smaller customers.”

The difference, however, is that smaller customers tend to buy smaller orders. “A lot of the customers Quantum Automation brings to the table are customers that we can count on to create constant revenue streams,” Welty says.

In that way, Quantum Automation serves as a sales force in the field for Automation Direct, providing a direct conduit between Automation Direct and larger customers, such as semiconductor and food manufacturers. “It’s very beneficial in the aspect that we don’t do any specific marketing to much larger customers, and when I say larger I mean national accounts,” Welty says. “They have people who are in the field who do those types of things, whereas we don’t do that type of thing at all.”

Welty says the partnership between Quantum Automation and Automation Direct has other benefits, as well. “For example, when we launch a new product, we try to get marketing information, whether printed or Web-based, to them so they can get them out to their people,” she says. “For us with mass advertising, it might be months before someone notices that we have a new product, whereas they can get the product into their hands quickly.”

Gallogly says this partnering approach has taken root at Quantum Automation and is finding new outlets. “We took that knowledge of being able to do it without a lot of handholding from Automation Direct to another company that also didn’t have a lot of support from the manufacturer, and we were able to parlay our technical abilities to be successful with that product line, as well,” he says.

Planning Ahead
“The biggest challenge right now is the macroeconomic world having their troubles, which trickles down to our customers having problems getting financing from the banks to build new machines and processes,” Gallogly says. Although the company has not seen the effect of this yet, it expects customers to begin slowing down their orders soon as the capital for new equipment begins to run out.

“As a result, I’ve had to make sure that our credit line is solid and we have minimal balance on our credit line,” Gallogly says.

Quantum Automation is also concentrating on bringing in new OEMs and new product lines under its umbrella, as well as finding new applications for its existing product lines.

The price of components has also gone down significantly since the company first started, with a typical programmable controller dropping from $2,500 to $200, Gallogly says. That means we need to sell higher volumes at sometimes less profit margin, plus more processing as a result.

Still, Gallogly notes there are still plenty of growth opportunities for Quantum Automation. “We’re looking at continuing to take on more and newer product lines and/or our existing vendors as they bring on new product lines, support those new product lines and explore some other avenues of business, meaning different markets that we have not been focusing on,” he says.