Clipper Distributing Asks How Best to Serve?

Clipper Distributing’s new president and CEO believes the organization’s top priority is serving all stakeholders – employees, partners, shareholders, and customers – by evolving with the industry, enhancing partnerships, and relentlessly seeking innovative ways to add value.

Earlier this year, St. Joseph, Missouri-based Clipper Distributing announced that Kevin Speltz was stepping back from his current role as president and CEO and assuming an advisory position as chairman. Corey Shigematsu succeeded him as president and CEO. Additionally, Jim Miller announced his retirement from his role as vice president and COO. John Ebling, who has served the last three years as CFO, will now also assume the responsibilities of VP and COO.

Vet-Advantage reached out to Shigematsu for insights into the company’s 2025 priorities and where the company fits in today’s animal health supply chain ecosystem.

What are your priorities for this year?

For me, it’s figuring out how best to serve. How do I serve our employees to make sure they’re confident in the organization’s leadership while at the same time assured that they’ll be able to continually support their families? How do I better serve our partners, so that we can help them grow their business in a rapidly changing environment and industry? Last but not least, how do I serve our shareholders in a way that meets their expectations today as we look toward our own future success?

Service should always be a priority, but figuring out how best to serve all of our stakeholders is number one on my list. Ask me again in a year, and I’ll let you know if I figured out even a small part of it – better yet would be to ask our employees in a year and see if they think I figured it out.

You are owned by distributors and play a key role for them, as well as manufacturers. What is the current value proposition, and how do you enhance it in the future?

At the end of the day, Clipper Distributing has one mission: to be seen by those manufacturers that we work with as the most valued partner they have in the animal health industry. Our sole focus is to provide solutions for those unmet needs and “pain points” that we’re uniquely situated in the market to solve. Whether that be logistical support to supply the market more efficiently, enhancing suppliers’ commercial success through stronger messaging, awareness, and programming, or simply acting as an ambassador between manufacturers and distributors to ensure they’re aligned on their goals.

Put most simply, Clipper acts to amplify the efforts of like-minded organizations to create better experiences for veterinarians, their patients, and their clients. Our company credo, SAIL: Saving Animals, Improving Lives, really says it all. We believe if we keep that as our “North Star” there will always be a place for that, and us, in this market.

How do we enhance it going forward? Well, that’s the trick, isn’t it? As the customer, the industry and even the world evolves around us, so too must we advance to continue bringing value to our partners. Clipper regularly and repeatedly evaluates itself by asking, “What more can we do?” Technology, training, data analytics, artificial intelligence – we are constantly on the lookout for new and innovative angles to better approach the market. Asking those types of questions is where I think you start. It’s a never-ending search to be stronger, faster, and smarter, but you have to keep searching. I have some of my own ideas, but I also have a great team around me where even better ideas will come from.

With the proliferation of online options and ordering platforms like Vetcove and Amazon, how can Clipper help distributors bring more value to veterinary customers, for mutual benefit?

A lot has changed in the last five years. That is absolutely evident, and I don’t see the rate of change slowing down anytime soon, and we certainly aren’t going to go backwards. I believe we all really need to take a look at these platforms and ask what need they are meeting for customers that we weren’t meeting before and likely still aren’t. Because with their rapid adoption it’s obvious they are on to something.

The next question to ask is how do we better meet needs that these platforms don’t address, and then how do we better communicate those solutions to our customers? I just mentioned the never-ending search to be stronger, faster and smarter. We all have to innovate to elevate our customers’ experiences when they interact with us. At every touchpoint, are our customers getting expert advice, personalized recommendations and exceptional customer service? Are we creating a human connection that builds trust and loyalty? How are we helping our customers build their businesses and their communities?

The days of the old country veterinarian may be waning, but veterinary clinics are an integral part of the health of their municipalities. Veterinarians are people just like everyone else, and what they want – and actually demand – from those that sell to them has changed. They want seamless online-offline experiences, exclusive perks and to be rewarded for their loyalty. I think they want value beyond the products with emotional connections to what they’re using, and they want it with immediate gratification. Those distributors that can answer even just a few of these questions and challenges will be setting themselves up for the long game.

The industry has been challenged in finding effective ways to bring new products and services to the market. How can Clipper help, and where do you see the most lucrative opportunities in the future?

Well, I think there are two pieces to this equation. The first is the bringing of new products. Since I joined Clipper a little over a year ago, I would say some new product or technology has come across my desk about once a week. Unfortunately, due to some of animal health’s lower bar of entry, there are a lot of, what I would call, “unworthy” products pitched to our market. Unresearched, unproven and quite frankly, ineffective products that rely on social media influencers or tradeshow shenanigans to try and make a quick dollar.

However, there really are some good “diamonds in the rough” that we’ve seen even in the last few months. And I’m optimistic from the good research I’ve seen being done in the pharmaceutical, nutraceutical and technological aspects of veterinary medicine today. It is evident that with certain acquisitions and breakthroughs over the last couple of years we’re on the precipice of a wave of new products and technologies over the next half-decade. In a lot of ways, Clipper’s vetting process for many of these products or services allows for a fair evaluation when normally they would be “drowned out” in the crowd, and possibly gain an advocate that can speed them to market.

With that being said, the other side of the equation is the adoption of these new products and technologies. I remember as a salesperson, a few decades ago, who walked into veterinary clinics on a daily basis, just like manufacturer and distributors sales reps today, more than one veterinarian told me that online pharmacies were just a passing fad. I’m pretty sure they got it wrong. Yet as an industry, I don’t know how good a job we did to convince them otherwise, and we’ve seen how home delivery has changed our business.

I saw a study not too long ago that asked veterinarians where they most often learned about new drugs, treatments and technologies. The number one answer was trade shows. That simply struck me as paradoxical. Every day, veterinary clinics around the county have salespeople from both manufacturers and distributors walking in their door, yet the number one way they learned about something new was to travel and go to a trade show. I could speculate on what medical fields or markets are likely to be the most lucrative going forward, but nowadays, one can simply throw the question of what opportunities or market trends will yield the highest dollar value into ChatGPT and get those answers pretty easily.

However, I think those that are really going to flourish over the course of the next five years are those that can add value through offering education and guidance to veterinary clinics and being a one-stop shop for expertise on any number of topics, including sustainability, biosecurity, telemedicine, and financial preparedness, to name just a few. Cracking that code is how salespeople and distributors are going to get ahead.

Today many distributors have rounded out their product offering with private label products and new technology. Does this change the way you think about future offerings for distribution?

It’s a good question and I know from my past in the manufacturing side of the business that suppliers are asking this question often both about themselves and about what they offer to distribution. Right now, I don’t think there is a firm answer. But I do think there is not a “cookie cutter” approach that any organization should take in their relationship with “distribution,” nor any single-approach methodology that distribution can take with manufacturers.

Although it is easy to lump all of “distribution” into the same category, every distributor is different in so many ways – ownership defining where they’re driving short-term/long-term, regional strengths and weaknesses, attitudes toward customer approach, training programs and onboarding, internal and external incentives, etc. Not to mention the nuances of current leadership, timing of their fiscal year and even turnover of personnel. Treating every distributor equally across the board is a bit antiquated.

Rather, I’d advocate for manufacturers to have honest dialogue with every distributor, including frank conversations on where they are trying to drive strategically and how they feel their tactics will support their direction. Then ask for feedback and critique. On the flipside of that coin, I’d say distributors should be having those same conversations with manufacturers. So often we don’t ask for the criticism because we don’t want to hear it, even if it really needs to be heard. I’d say these two-way conversations at the executive, regional and sales representative level are all invaluable for us to come to common ground on what our offerings are or can be for customers.

Yet, for anyone to have in their mind that “All distribution is doing XYZ,” or to believe “All manufacturers just want ABC,” I think that is a myopic way to look at each other as partners – partners who really do need each other to make this thing go – whether we want to admit it or not. In my opinion, regardless of whether it is offerings, general support, or customized approaches, the future is with stronger partnerships between manufacturers and distributors. As an industry I believe we agree on more than what we disagree about, and there’s plenty of room for win-win scenarios for all parties.

The industry is living through a few soft years post COVID, with declining veterinary visits, rising costs and numerous new competitors. While we have the economic cycle in our favor at this point, what turns the tide back to the high level of growth we experienced prior to and during COVID?

So, let’s start here: The story of animal health growth is far from over, and we have a lot of good days ahead. However, we do need to acknowledge that the growth around COVID was a “black swan” event with our growth curve now moving to a pattern of normalization.

Veterinary hospitals began working at 110% to 120% of capacity just to keep up, after 6-12 months of being limited to providing just the basic patient care for their patients. Surgeries were postponed, procedures were pushed back and even vaccinations outright skipped, followed by a flood of required veterinary care to catch back up whether hospitals brought on new clients or not. At the same time, we also saw a spike in veterinary care costs both in services at the veterinary clinic and prices of everything from disinfectants to MRI machines. This “double-shot” gave us some pretty good growth numbers in the short-term post-COVID. Now, we’re simply in a “new normal” where visits are moving back down to pre-COVID numbers. It stands to reason that a “new normal” has new challenges and needs new answers.

But I remember back to what I was once told by a veterinarian I used to call on. He said that to have a successful practice, you only needed one of four of the following:

1. A great location
2. A head for business
3. Incredible people skills to be well-liked
4. Be such a good veterinarian that you could solve problems that other veterinarians couldn’t.

I think we’ve now just moved to a place where veterinarians and veterinary practices need all four to be successful. To me, that just feels like a great time to be in the industry. What I mean by that is if a veterinarian is falling short in any areas of their business, then there are plenty of opportunities where we, as the servants of this industry, can help them in some way, shape, or form. The way I look at it, most of us in this industry didn’t go to veterinary school, so we have a responsibility to support and ensure the success of those who did. What a great responsibility to have, to serve those that serve others.

I guess this brings our conversation full circle. How do we better serve? If we can answer that question, I believe the economics will take care of themselves. And at the end of the day that’s our job. What a great job to have.

Clipper Distributing’s dual mandate

Clipper’s association with both manufacturers and distributors gives the company a dual mandate: support distribution with tools to better compete and grow, while providing manufacturers with an efficient, scalable route to the market.

“Where Clipper really benefits its partners is in our investment of time, energy, and resources tackling the ‘what if’ scenarios where we can gameplay some of the possibilities that are out there to meet both mandates,” Shigematsu said. “Just a small sample size of what we’re exploring is leveraging national buying power for better sourcing access for human generics and commodity items, utilizing technologies to decrease supply-chain operational complexities and simplifying market entry for innovations that can provide veterinary hospitals access to medical advances quicker and more efficiently.”

Photo credits: istockphoto.com/FatCamera, istockphoto.com/sturti