Tough Call: Not a warehouse

Tough Call Warehouse
istock.com/MartinBarraud

A long-delayed project for a very important customer means you’re left holding onto a serious amount of materials without the space to do so. What would you do?

As a successful, full-line dealer serving many (if not most) of the strongest builders in your market, 2020 is working out to be a surprisingly strong sales year.

Along with several record sales months, you’ve also faced down the same challenges as other dealers from across the U.S.: serious material shortages, record-high commodity prices, difficulty attracting new talent to replace team members who are retiring, etc. In addition, because no two LBM dealers are exactly alike, you’ve faced some unique situations with no easy answers.

Case in point: Bob and Betty Deeproots, a prominent couple in town, decided to do an extensive remodel of their stately home, including new windows, siding, decking, and more. When they began the planning process back in early 2019, they instructed their remodeler to buy all materials from your yard. As their last name implies, the family has deep roots in the community, and they believe strongly in keeping their money local whenever possible.

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Once they’d made all their product decisions—which took just over a year—they finally pulled the trigger and ordered the materials in April. Everything arrived at your yard on time, they paid the $85,000 bill, and the project was moving forward as planned. The morning that the first load of materials was on the truck for delivery is when the problems began.

The remodeling contractor called to reschedule the delivery. Something had come up, and his crew wouldn’t be ready for the materials for another two weeks. Your crew unloaded the truck and set the material aside. Two weeks later, the contractor did it again, delaying delivery by another two weeks. The next call came from Bob Deeproots himself. “Our remodeling contractor just pulled out of the job. I’ll need you to hold onto the material while we secure someone to complete the job.”

By this time in late May, most remodeling contractors were already booked up for months. And since the Deeproots are very selective about who completes the work, they have yet to find a replacement. Normally, that wouldn’t be a problem. Then again, normally, you wouldn’t have $85,000 in materials eating up valuable warehouse space during one of your busiest years ever.

The material is paid for, so that part’s fine. But your warehouse was engineered to move material in and out efficiently, not for long-term storage. You appreciated the Deeproots buying all of the material from your yard, but storing it is causing headaches for your warehouse manager, who is frustrated about the space issue, and also concerned about the possibility of accidental damage to some of their custom products.

What would you do?

Just deliver. Let Bob and Betty know that you’re unable to continue storing their materials and schedule a date to deliver the materials to their home. Then do it and be done.

Warehouse. Negotiate a fair rate with a local warehouse where the materials can be stored until needed, then let Bob and Betty know that you’re moving their materials, and they’ll have to pay storage.

• Find a builder. Work your network of contractors to find someone who would do a great job with this project, make the introductions, and convince the Deeproots to move forward.

• Talk it through. You know Bob and Betty are in a tough spot. Sit down with them, explain why you can no longer store their materials, and agree to work together to find a solution.

What would you do?

If you’d take a different plan of attack, email your suggested solution to James@LBMJournal.com. If we publish your reply, we’ll send you an LBM Journal mug.

 

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