The market for engineered framing lumber has matured, but it still offers real opportunities for pro dealers who understand that its potential goes beyond product sales. The bottom line is that while many regard engineered framing as a commodity, you make a mistake by selling it as such. Engineered framing manufacturers all say that their most successful dealers are the ones who create systems that save their builder customers time and money.
A dealer's best choice to create these systems is with the most successful category of engineered framing—wood I-joists—which commands a 52% share of floor framing for new homes nationwide, according to APA - The Engineered Wood Association. [That share is projected to top off between 55% to 60% of the new-home floor framing market over the next few years.]
Regardless of how strong the demand, don't automatically assume that you can keep the same share of the I-joist market as you have with dimensional lumber. Creating systems to successfully sell products requires that you embrace new skills and business processes. The good news is that dealers who do so tend to dominate engineered wood sales in their market.
Dealers that harness technology to deliver precut engineered wood framing packages to their builder customers can increase their company's share of the EWP market. (Photo courtesy of APA - The Engineered Wood Association)
"The most successful dealers are those that invest in technologies that streamline the design and delivery of engineered lumber," one manufacturer told us. The most basic investment is a piece of design software that lets you create floor framing plans with I-joists, and perhaps even roof and wall plans using laminated veneer lumber (LVL) or laminated strand lumber (LSL).
The ultimate is a fully automated system where the software sends a cut list to an automated saw, which cuts joists to a tolerance of 1/16 inch, and color-codes them to the plans. Pieces are bundled and stacked on the jobsite in the order the framer will use them. What if you don't have $200,000 to $400,000 to invest in a fully automated system but still want to offer precut packages? You can get a foot in the door for as little as $55,000 for design software that outputs a paper cut list, and a saw with a manual feed. The saw can be upgraded later on, if business warrants it.
Regardless of the investment level, dealers who have used these services to increase business say they require a different way of thinking. "You need to change your mindset," says Bill Walker, who manages National Lumber, a Mansfield, Mass., dealer that invested in the full automated system four years ago. "This is very different than selling lumber in two-foot increments."
Walker says that selling is now as much a consulting process as it is a sales process, and that it's totally focused on helping the builder's operation. His staff dissects each framing plan to make sure it's accurately dimensioned, then sends a field rep to the site after the foundation has been poured to verify that it's dimensioned per plan. If the foundation is off, the cut package can be adjusted. When working with a builder for the first time, National Lumber field reps take time to make sure the framing crew understands the system. "Every piece is color coded and keyed to the plans, so you don't want guys just grabbing pieces from the pile." In addition, Walker has two in-house structural engineers who can stamp plans. Many local building inspectors accept a letter from National in lieu of a framing inspection.
Walker says these services have helped increase the company's market share. "[Engineering and precut services] are a huge time-saver for framers, so we now have a lot of framers who request them," he says. And while National doesn't charge extra for these services, the efficiencies they have brought to its operation have increased per-job profits. "We can process 30% to 40% more material with less labor. And we have less waste."
Even if you opt for the minimal investment, you should still invest in training. If your staff can quickly and knowledgeably answer product and framing questions, help builders with structural design, and deliver products in a way that boosts job efficiency, that will go a long way toward making you their go-to supplier. Ignore this, and you may eventually lose customers to dealers who take these services seriously.—Charles Wardell