More than 100 dealers and distributors from North Carolina, South Carolina, Tennessee, and Virginia gathered in Virginia Beach, Va., for the Southern Building Material Association’s annual summer conference. ProSales went, too, and found that despite dealers’ beachside proximity, conversations focused on business growth had little to do with sitting back and watching the tide come in. Instead, representatives reported hints of optimism as economic recovery continues and are looking for ways to deftly tackle the incoming waves. Here’s a look at the major talking points:
Despite last month’s disappointing 1.5% GDP growth, exports are rising, household debt is on the decline, and housing starts are up (albeit in lieu of the anticipated “bounce-back”), says Ed Seifried, a banking consultant and economics professor emeritus at Lafayette College in Easton, Pa., who compiled indicator data into this chart. Meantime, Seifried expects eastern Ohio, Pennsylvania, and areas of New York to see gains similar to those of North Dakota as the area taps into its natural gas resources.
When it comes to health care, it’s not just what you do (provide your 50+ employees with coverage or send them to the exchanges), but what approach your competitors take, Burman Clark, president at Virginia insurance brokerage firm Muneris, told dealers. It could cost them money, make them a more attractive employer, or both. Regardless, keep your employees in the know about how their health care benefits will be affected. If you decide to forgo coverage, offering guidance on purchasing health care becomes more than a courtesy with employees’ purchasing the least-expensive option being a risk to you. Learn more about how the Affordable Care Act could affect your operations in our three-part series.
Some dealers said that much of their long term planning is risky until after the election. The potential for political gridlock affects everything from the taxes you’ll pay to whether or not the Affordable Care Act will have any legs.
Dealers stressed that relationships are key as they look to scale back up with improvements to demand—but trimming fat in spending and limiting credit available to customers are equally important. As one dealer put it during a roundtable discussion: Work with your builder’s banker, don’t become it.
Always be upselling. Train your team to find new prospects without getting in over its head and to sell a better product rather than a host of accessories. If you need a new motto to jumpstart your sales team, take it from panelist Tom Randolph of Randolph-Bundy, a millwork, window, and door distributor in Portsmounth, Va., and tell them to “take it out of your customers pocket and put it into your pocket.”
Diversification is becoming more than a hopeful catchphrase. Dealers who cater to the still-flailing custom market or whose portfolios are strongly tied to new, single-family construction can benefit from looking at new market opportunities. Multifamily is on the upswing, and was discussed as a potential new market for many dealers who sell to the still-flailing custom segment.
An independent board of advisors could be a huge asset to a family business. Dealers traded advice on putting together and financing a small group of outside experts who could beef up knowledge gaps in their own operations, offer retrospective advice on growing business, and even mediate in situations where close relationships make it difficult for owners to put their foot down.