The easy days are over.

Success in this depressed residential construction market will take strategies born from both guts and wits. The first step is to return to the core principles of running a business–principles unknown to many new dealers who never had to learn them during the years of plenty. Have you already mastered those principles? Then this is the time for fresh thinking about managing your business. Here's a collection of core and second-level ideas for doing better business in bad times, all drawn from ProSales editors and contributors. Not every strategy presented here is appropriate for every pro dealer, however; choose the ones that work best for you and get to work.

Branch Out

Still serving the same builder customers but with smaller orders and more pressure on margins and service? Then increase your service offerings, focus on what you do well, and do more of it. For instance, maybe it's time to consider a shift from doing installed sales for just your builder customers to offering those services to commercial customers, small-business customers, and the ever-increasing remodel/retrofit customer. Surveys are finding that most people 50 years and older plan on staying in their homes longer. They'll be wanting new windows and doors, floor coverings, upscale kitchen and bath remodels, and other areas that you're already offering to your builders. Neither your labor force nor your inventory have to change, so you have the ability to make more money with your existing infrastructure and open the doors to markets that many of us have given up to the big boxes.

–Mike Butts

Mix High-Touch With High-Tech

During a downturn, customers find comfort in relationships and face-to-face meetings. Allocate time for high-touch, personalized encounters. At the same time, commit to improving your use of the Web, a powerful marketing and prospecting tool with potential tapped by too few in our industry.

–Jim Groff

When Selling, Seize Learning Opportunities

A crisis is also an opportunity for learning, and it is never too late to get started on some key sales strategies:

  1. Insist that your salespeople proactively prospect and you will discover many sales opportunities are waiting to be had.
  2. Call those customers that haven't purchased from you in a year yet appear on your customer lists. Let them know you still care.
  3. Remind your salespeople of the difference between servicing existing business and proactively seeking new business. The training effort will buoy your company during challenging times and elevate your sales when the market stabilizes.

If you try these tips and the housing economy fails to bounce back quickly, you'll be glad that you have prepared yourself for an intense battle. If the economy does bounce back, you'll be poised for an even better recovery than the market would normally have offered. Either way–you win!
–Rick Davis

Let Your Mouse Do the Walking

Since 2002, use of the online version of the Yellow Pages has gone up 64%, while references to the print version have dropped by 40%. That trend underlines the importance of online advertising vehicles. If you have a Web site, make certain it provides such basics as current hours of operation, telephone numbers, e-mail contact info, and "find us" maps. Got those already? Then go further by listing your products and promoting special services. And if you don't have a site, for goodness' sake create one. Places like offer free hosting, plus software that makes it no harder to build a Web presence than it is to use Microsoft Word–easier, probably.

–Craig Webb

Crying? There's No Crying in LBM!

At Big Builder '06, the annual conference for ProSales' sister magazine Big Builder, John Laing Homes CEO Larry Webb offered these survival tips:

  1. Communicate more, not less, with the staff. Confront the brutal facts.
  2. Expand, do not reduce, educational opportunities for staffers.
  3. Don't forget the little things, like holiday parties.
  4. Your senior staff should get out into the field more.
  5. No sulking from presidents! "We don't have the luxury of self-pity."
  6. Hire and upgrade your staff. "Fill your organization with the A players."
  7. Set operational goals. You can't control the market, but you can become a better builder.
  8. Figure out your core values and stay true to them.

–Craig Webb

Attention! I'm Taking a Pay Cut

Cut executive salaries and benefits and advertise it.

If you're the top dog, chances are you're getting paid top dollar. If salary reduction is the road your company needs to travel down in leaner times, the first step is to lighten your own personal load. And don't be bashful about promoting it–employees who see their leadership taking one for the team are much more likely to do the same and are also more likely to stay in the dugout rather than go searching for greener pastures.

–Jim Harris