|Mike Majsak is director of sales and marketing for Fypon, the leader in polyurethane moulding and millwork, where he is responsible for sales and business development, product development, and customer service.|
With both new construction and remodeling on a solid growth curve in most markets, what would you define as the clearest opportunity—as well as the biggest challenge —facing LBM dealers?
The shortage of skilled labor in the construction industry continues to be a significant issue for builders and remodelers. And this becomes LBM dealers’ problem, as well, because while there’s demand for products, if there’s no labor to do the installation, it could slow sales. Savvy dealers are turning this challenge into an opportunity by having ready access to skilled installers or offering installation services themselves. This is particularly helpful for small- to medium-sized builders who want to buy lumber or doors or molding but have to wait for available labor. Dealers that can offer those builders not just products but also installation can help retain that customer and grow business.
In the quest to grow their business, more LBM dealers are getting into installed sales and other services. What do you see as the pros and cons of dealers selling moulding and trim on an installed basis?
It’s important to understand the skill level required for the products you sell and ensure you are capable of finding installers who possess that skill level. It’s one thing to go out and nail up some shutters and another to cut, miter, and fit window trim.
It’s also important to understand your product. For example, while traditional trim requires skilled craftsmen to install, man-made products like polyurethane moulding allow for intricate trimwork without having to do buildups, cull stock, or match materials; overall it’s a faster, more forgiving installation and therefore easier to provide qualified installers.
Online commerce continues to grow, with more building material categories being sold online. How do you see this trend affecting the dealers that sell your products?
For us, our online business is growing, but for now it appears to be primarily homeowners or small contractors ordering a little at a time. It’s business the traditional dealer wasn’t necessarily getting anyway.
What’s also trending—and where the bigger threat lies— is the small remodeling contractor using online sources to allow customers to pick out lights, tile, fixtures, etc. They set up accounts with online sources, their customers go online to browse, and the remodeler orders directly from there. It’s easier for the contractor because he or she doesn’t have to send customers to a showroom or carry samples around.
It’s a small percentage now, but it’s starting to trend upward. Online sales are now migrating to that smaller contractor, and maybe soon to larger contractors. That’s when it will start to really affect dealers, especially those that have no way to show their breadth of product. Dealers need to start thinking about having an online presence so that customers know what’s available and so that they have a place to send homeowners to make selections. This is particularly crucial for dealers whose customer base is made up of smaller contractors.
Expanding on that answer, how important do you believe it is for dealers to maintain well-designed and updated showrooms?
I think a homeowner or contractor who is making the purchasing decision is more apt to purchase from a source where they can actually see product. If you don’t have a showroom, an online presence is even more critical.
It also depends on your primary customer. If you just serve large production builders buying in volume, they’re not as dependent on a dealer showroom or may have their own. But for that smaller builder, custom builder, or remodeler, it’s more critical.
From your experience, what sets top performing dealers apart from their peers?
Standout dealers understand who their customers are and understand what’s important to those customers. For example, the needs of a contractor ordering small amounts and picking them up versus a larger contractor who needs delivery. Make yourself easy to do business with according to what your specific customer base needs.
Also, they need to be knowledgeable about the products and product categories they carry so they’re able to provide advice—here is the right product for this job, here are the tools and materials you need to install it. The dealers that can do that will have the advantage.