By Carlos David Mogollón, WC&P Executive Editor
Superior Water Systems, of Gardena, Calif., just celebrated its 51st year in business and launched a revamped “Dealer Advantage” program designed to reinforce and leverage its support of independent dealers it supplies in 11 Western states as well as Hawaii and Mexico.
Today, the list of dealers is about 150 strong, said Superior’s president David Kratzer. Kratzer joined the company full-time in 1972 when his father, Frank Kratzer—who started the business in 1950—was still president. An avid supporter of independents, the elder Kratzer died in 1990, a year after his son officially took over.
“He was one of the pioneers of this industry,” says the younger Kratzer, speaking with pride about the role his father played in developing the point-of-use/point-of-entry water treatment market. That was particularly true for portable exchange deionization and mobile systems for on-site regeneration.
“We had certified welders. We had a (brass) valve we put together. And we fabricated our own brine tanks out of metal… We also made large systems for hotels, hospitals, commercial operations and residential systems. At the time, each state had a Superior outlet—Superior Las Vegas, Superior Utah, etc.”
With the transition toward fiberglass and polyethylene tanks in the ’70s, Superior sold its manufacturing divisions and entered into supplier agreements with components suppliers, including proprietary conditioner valves and reverse osmosis (RO) systems.
In the early ’90s, a Superior supplier, Raytec, pulled out of the West Coast, prompting Kratzer to join two of its former executives in founding Challenger Water. Five years later, though, he sold his interest and signed on with Clack Corp. to supply it with proprietary RO systems.
When Kratzer took over as president, he noted the company had $2.8-3 million in revenue, 25 employees, 100 dealers and a facility encompassing 6,000 square feet. Today, sales have increased by more than $1 million, there are half as many dealers and the facility has grown to 16,000 square feet.
He’s not content, however, to rest on his laurels, considering shifting sands as Big Box mass retailers, utilities and foreign multinationals attempted to slice up the market in recent years. This hasn’t only put the pinch on smaller manufacturer/assemblers but hurt morale among independent dealers they support and rely upon.
So, in the past two months, Superior has introduced two new products—the Ultimate V RO and Ultimate II conditioner—and enlisted the services of Arnold Ng of Insight Learning as its new business strategist to define specific strategies to reinvigorate and excite the Dealer Advantage program.
“We felt the need to do this because of all the consolidations and takeovers and large companies that are coming in and kind of leaving the independent stranded out there,” Kratzer said. “We felt that, with this marketing, we brought them in to make all these independents feel like they’re part of a larger group.”
Portraying the challenge as sort of a David vs. Goliath clash, Kratzer says it’s the independent that can offer an added sense of personal care consumers are craving today.
He also comments on fallout from the economy and the Sept. 11 terrorist attacks, California’s Prop. 65 and tighter salt efficiency standards, the impact of losing a major contract, and the possibility of independent suppliers uniting to give themselves a more competitive edge.
Owner: David Kratzer, president
Revenue: More than $4 million with 10-12 percent annual growth
Operations: Manufacturer/assembler of RO drinking water, multi-stage filtration and water conditioning systems for distribution in 11 Western states and Hawaii, Mexico and Asia; 60 percent residential, 30 percent commercial, 10 percent industrial; sales network includes 150 independent dealers; key suppliers—Clack Corp., Pentair, Osmonics, K&M, Rohm and Haas and Sybron; brands include Ultimate V RO and Ultimate II softener.