Loupreneur sat down with Jermaine Watkins, the President and CEO of Supply Ark, a Louisville business that provides distribution channels and seamless fulfillment strategies for military and government contracts as well as commercial bids. Since 2009, Supply Ark’s team of three has had an innovative focus on strategically winning contracts from the Defense Logistics Agency bid process. Watkins crafted a proprietary system that automates the bid process for the military’s miscellaneous items requests.
Success for Watkins comes from combining a tech background as a former employee of the US Army Corps of Engineers and as a website developer for Borders Unlimited Inc., a wholesale distributor of wallpaper borders for a company in Shelbyville, KY. Supply Ark grew out of his desire to be a self-motivator and from his childhood in which he was raised by entrepreneurs. “I got tired of working for a company and paying my own salary. I thought, ‘this is ridiculous, I can do this from home.’ I realized that if I can sell almost a million dollars in wallpaper borders, then I can make my own money doing something else,” jokes Watkins.
Watkins fueled his desire by beginning to develop his business while remaining part-time at Borders Unlimited. He attended a seminar detailing the process of winning government contracts from the military. Watkins commented that the military has a strong digital presence in the bidding process, but that the market for large distribution contracts had been cornered long ago. Watkins realized that a niche market existed for contracts on smaller miscellaneous items that multi-billion dollar companies overlook, because no one had developed the tech angle to aggregate smaller contracts in a profitable way. With his background in digital programming and experience working with the military, Watkins was able to design his price and evaluation system that mines the Defense Logistics Agency (DLA) bid board, and Supply Ark was born.
The company specializes in purchasing smaller, miscellaneous goods directly from the producer and consolidating orders. Many of the producers are not equipped to handle small bids from the military, since the turnaround period on the contracts is so fast. Goods being sent to the military must be shipped by military standards and that can be difficult for companies to do while still remaining profitable. That’s where Supply Ark steps in and helps the manufacturer to fulfill the military’s needs because they can process according to military standards; that way the suppliers are not bothered with it.
One challenge Supply Ark has faced is financing its shipping orders. They do not receive funding for accounts receivable until after an item has shipped, so there is a need to buy items before collecting collateral. It has proven difficult for the company to find financing on small orders, despite the volume that they handle. Watkins has been able to respond to the challenge by consolidating items to receive financing for larger orders.
Growth has been steady for the company, and they have been awarded an increasing amount of contracts each year. Watkins comments that they are currently in a state of transformation saying that, “Originally my business was a lifestyle business, but it really has some legs under it now. We are trying to clean it up and have better accounting standards, and we are trying to do things more like a real business and less like a hobby business.” Watkins has developed his niche in the military’s contract business, but since Supply Ark currently only deals with the DLA, his team has a great opportunity to grow the company by entering into contracts with other agencies from within the military.
To continue growth by securing more bids, Watkins has been investigating funding sources from EnterpriseCorp. He is currently in conversations with venture capitalists. In order for Supply Ark to grow, Watkins needs to expand his workforce, but first needs to finish developing an interface for his automated system. All of the miscellaneous bid data from the military is very scattered, but with his tech background and years of experience with the data, Watkins is extremely efficient at finding all of the bid information and matching it with products in a profitable way. Continuing developments of the interface are necessary because it will allow him to hire employees to use the software and perform the same functions that he can (without needing his highly unique skill set).
Pressure is on for the business to expand as Watkins has been contacted by emergency supply teams and relief groups such as FEMA because Supply Ark has proven more reliable at meeting the demands of the consumer than most vendors. Procuring items through Supply Ark has proven advantageous for the DLA, because some suppliers have to drastically increase prices in order to correctly ship items to military standards. Watkins is focusing his automated system on identifying items that have higher profit margins which will be more marketable to the military and at a lower cost than from the supplier.
Despite facing the challenges of growth for such a highly specialized company, Watkins has used his desire and optimism to make Supply Ark into a success. To other entrepreneurs his advice is:
When you’re overwhelmed, just keep going. There have certainly been days that I have been overwhelmed, but I am glad that I continued to do what I did. There are challenges every day, but you have to fight through, because there are good days, and some days are great!