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August, 2007

The Winnerís Circle

By Rick Schumacher

The current housing slump is taking its toll on all levels of the supply chain—from manufacturers to builders and everyone in between. The challenges we face today may seem insurmountable and unfortunately, for some companies, they are.


But in the 17 years that I’ve covered this industry, grizzled old veteran that I am, I’ve learned that huge obstacles are nothing new. The only difference is the specific situation. The names and the locations have changed, but the storyline remains the same. In the end, to the winner go the spoils.


The winner is any LBM dealer able to create sales during the current housing bust. (For a detailed analysis of the present slump, visit www.jchs.harvard.edu and click on The State of the Nation’s Housing 2007.) The “everyone’s a winner” 1990s may be a distant memory, but revenue opportunities remain. The challenge is to find them and capitalize on them, which may mean venturing into unfamiliar territory or redoubling existing efforts.


The key is to understand what your customers—and potential customers—need. Then deliver.


LBM Journal recently completed a large research study, and we found that the vast majority of you (72.65%) count Custom Builders among your primary customers. That being the case, it was no big surprise to see the most common service capabilities are the ones that help your key customers work more efficiently and profitably. More than 57% of LBM readers provide “Builder Education/Training,” which demonstrates to your customers that you’re committed to their success. Most of the other top scoring services (truck-mounted forklift delivery, 49.17%; door prehanging shop, 38.12%; custom millwork shop, 35.08%; and engineering services, 39.78%) are more tangible offerings that help you establish a competitive advantage.


At LBM Journal, our role is to deliver the front-line intelligence you need to best position your company for success. When housing is slow, and each sale becomes even more valuable, that makes our role more important than ever. Here’s what we’re doing about it:


Our “How to Sell” series. Selling to custom builders is different than selling to big builders, which is dramatically different from selling to remodelers, and so on. That’s why we put seasoned industry writers to work uncovering what these different customer segments really want from their suppliers. This month, senior contributing editor Craig Shutt focuses his nearly three-decades of experience covering this industry on “How to Sell to Custom Homebuilders.”


New voices. The popularity of experts like Gary Katz and Steve Easley told us that you’re hungry for expert insights into what your customers expect from you. This month, Gary turns his space over to expert builder Mike Sloggatt, whose piece on using construction calculators is a must-read for anyone in your company who has regular contact with builders.


Demystifying “green.” In my experience, green building is the hottest trend ever to hit residential construction. Unfortunately, it’s also among the most confusing. Ask 10 builders or remodelers what it means to build green, and you’ll get 10 different answers. The growing demand means that there’s a tremendous upside for dealers with a solid understanding of green materials and construction methods. That’s why we’ve enlisted the vast experience and expertise of John Wagner to demystify this growing trend.


Here’s to helping you squeeze every sale out of this downturn, and to keeping your company in the winner’s circle.

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