LBM Journal’s Dealer of the Year Awards recognize four LBM companies of different sizes that epitomize the entrepreneurial spirit. By our definition, a Dealer Of The Year describes a company in which leadership excels at identifying underserved—or emerging—markets, satisfying customers, and constantly working to grow and improve business. Our 2020 winners—Kuiken Brothers, Gillman Home Center, Lang Building Supply, and R.T. Griffis & Sons—represent vastly different operations. The common thread in these companies is their fierce commitment to finding ever better ways to serve their customers and their communities.
Gillman Home Center: Growth from the Ground Up
Most successful LBM dealers exhibit a certain amount of do-it-yourself fortitude. They’ve built and grown their business to be the best it can be in their markets. Few, however, have literally built their businesses like Charlie Gillman has. Nine of Gillman Home Center’s 12 locations were built by Charlie and crew from the ground up. That DIY spirit is why his company is this year’s LBM Journal Dealer of the Year in the category of sales between $50 and $100 million.
Starting his career as a building contractor back in 1980 helped Charlie gain the knowledge and experience necessary to grow one of the most successful building materials supply chains in the country, topping $75 million in sales in 2019. When he opened his first home center in Batesville, Indiana in 1995, Charlie still kept working as a general contractor for another 15 years, further entrenching himself in the region’s building industry. His experience as a successful builder helped bring in a whole new generation of builder customers to his Gillman Home Center locations.
“I was a successful builder, but I’m old now,” he jokes. “Now I meet with a lot of builders one-on-one. I show them how to do bidding, how to run their finances. I share with them how to grow their business. I’ve got knowledge to share, and that has been very valuable for me.”
Out of the building game for the most part these days, Gillman is in the process of transitioning the home center business to his son, Curtis. With his time freeing up, he is now developing lots for builders, an interest that further helps to solidify relationships with his builder customers.
“I develop property. If you want a lot, you’ll get a good price and you’ll buy your materials from us,” he says.
Blueprint for growth
Gillman Home Center plans a 13th location this spring. The store will be another ground-up construction in which Charlie will serve as general contractor. Doing so will save about 20% on the construction costs, he says. The father and son team have perfected the process of building and opening a store. Since 2014 the company has opened six locations. The Gillmans have hit on a winning formula with Charlie overseeing the construction and once a location is built, handing it off to Curtis, who serves as the company’s chief operating officer.
Starting with the 2014 construction of the Winchester, Indiana location, Curtis oversees the selection of products to stock at each store, and helps determine who to hire. Like his father, Curtis is a do-it-yourselfer.
“We do all our IT installations in-house,” Curtis says. “Steven, our IT manager, was in a bad car accident about six weeks before opening day. He was ultimately okay, but it was a long road to recovery and there was no way he was going to do the computer and network setup in Winchester. IT consultants run about $120 per hour plus mileage, hotel, and meals. I visited Steven at the hospital, and we came to the conclusion that he and I would team up to get it done. We networked the entire store—phones, security, POS, credit card machines, internet—by Steven walking me through it over the phone. Some days I spent over 6 hours just on the phone with him. We both got a great feeling of accomplishment from it, and it gave me a new appreciation not only for Steven’s everyday job duties, but also for his dedication.”
Curtis used their six existing stores as a template for what items to bring in, tweaking the selection as needed.
Overall the company serves a customer base of about 60% professional builders and the remaining balance is retail DIY. They don’t shy away from a focus on both.
“Weekends are very big for us,” Charlie says of his company’s availability to the DIY shopper. “We are only closed three days a year.”
Once Curtis hires the right crew for a new location, he sends them to work at other Gillman stores for several weeks in advance of the grand opening to get them up to speed and able to deliver the kind of service customers have come to expect from Gillman Home Center. Their diligent efforts in preparing every phase of the store have paid off. Winchester rang up sales of $4.3 million in 2018, marking a 37% increase since the opening.
They followed up their success in Winchester with another 15,000-square-foot, ground-up store in 2015, this time in New Castle. A lumberyard had gone out of business there recently, and the Gillmans saw that the 17,000 residents were now forced to leave town and drive up to 45 minutes to get building materials. With Charlie handling construction and Curtis preparing all aspects of the new store, they once more delivered a strong performance. Sales at New Castle reached $6.9 million last year, a 21% increase since its opening.
Then a series of events brought about an unprecedented pace of expansion for Gillman Home Center. In September 2017, Gillman’s opened another ground-up store, this time 60 miles northeast in Eaton, Ohio. Once again, Charlie built the store and Curtis oversaw merchandising along with the hiring and training of a whole new staff. They delivered another successful new store, with sales of $4.5 million its first year.
With Gillman Home Center on a clear growth trajectory, people took notice and started bringing opportunities to them. Some owners without clear succession plans were faced with the choice of selling or closing their doors. These opportunities represented a departure from their normal mode of expansion. Instead of only building new stores, Gillman’s growth strategy now branched out into acquisitions as well.
In November 2017—just two months after opening the Eaton store—Gillman’s bought the oldest lumber company in Indiana, located 30 miles southeast in Aurora. The owners were looking to retire, and the Gillmans acquired the business and enhanced the technology and operations. They cleared out old inventory and modernized the store’s product selection to bring it in line with other Gillman Home Center locations.
“When you build a ground-up store, everything is honestly much easier,” Curtis says. “We pick our inventory out and go with it. Buying an existing store presents more challenges because we have to deal with someone else’s inventory decisions. I have to bring their set of items in line with what we normally stock.”
In August 2018, they purchased two more stores 30 miles apart in Frankfort and Lebanon. Much like Aurora, Curtis worked to clean up the inventory and bring a more efficient and profitable way of retailing to the operation. The stores are already showing the benefits of Curtis’ retail expertise. Gillman Home Center employs about 300 people through the 12 locations, including a dozen outside sales reps and 11 home décor pros who handle inside sales of interior products such as cabinets, and floor covering, all contributing to 2019 annual revenues of $77 million, a figure that has tripled in the past decade and doubled in the last five years. Same-store sales for Gillman Home Center locations were up 5.7% in 2019, and according to Charlie, sales have grown an average of 13% per year since the first location was built 25 years ago.
Measuring success
Steady, smart growth is what the Gillmans are after, Charlie says, each year setting out to do better than the year previous.
“We make sure our success is beating our year before. We measure ourselves against ourselves. We’re highly driven as a company to be as successful as we can. Every year, we’re driven to get better.”
There is no end in sight for year-over-year growth, Charlie adds. The company continues to be on the lookout for underserved communities in which to build new stores. As the company grows, so does the DIY spirit of Gillman Home Center.
Recently, the company opened its own auto repair shop and used car dealership, run by Charlie’s other son, Travis. With a fleet of more than 100 vehicles, Charlie was looking for a way to take on some of the repair and replacement responsibilities to help keep costs down. When a friend invited him to a used car auction, he turned that experience into a used car lot of his own, so that he could attend and purchase from auctions, too.
“For the first few, we had just sold to ourselves,” he says. “Now we sell to the public and we’re making some money selling cars, but we’re also saving a fortune on vehicles for ourselves.”
In turn, if an employee is looking for a new vehicle, Charlie says he’ll take them to an auction and even finance the vehicle for them, an action that has contributed to increased employee loyalty.
And after he hired a mechanic to work on trucks, Charlie realized he could bring on a few more and service all the vehicles for the company.
“Now we have four mechanics and our own repair shop,” he says.
Charlie credits his entire team for reaching the success his company has achieved. At the core of that team is an office staff of 16 who are “the best in the industry,” he says, and they continue to get better.
“With them, and my son and me as owners, you won’t find people more driven to succeed,” he says.
