Jim Zyrowski can summarize his business philosophy in just four words: What Wal-Mart Won't Do. And at his Ben's Supercenter and Do it Best Lumber & Building Supply, Zyrowski's reply sprawls across 72,000 square feet.
The store in Brown City, Mich., definitely is a building material dealer–there are four drive-through lumber bays to prove it–but it also sells live poultry, shade trees, trailers, hunting rifles, fabric buildings, and fishing tackle. There's more: the SuperCenter includes a pharmacy, bank, delicatessen, screen printing and sign shop, rental center, Subway and ice cream franchises, and the family's own pizza and buffalo wings restaurant.
And don't forget the buffalo steaks on sale in the grocery. The dealer gets them from 200 head of bison he keeps on a farm outside Brown City, about 75 miles north of Detroit. In a community of 1,200, Zyrowski's customer base is 12,000.
Like Zyrowski, dealers across the country are finding it makes sense to diversify far beyond an LBM operation's traditional sticks and sheets. Often, the goal is to bring in a different class of customer–females. Other products may be picked up after the line no longer is available in the area or because, as with Ben's Supercenter, the owner saw a community need and decided to fill it.
For instance, in Zyrowski's neck of the woods, a lot of his customers were using propane gas for heating, so he searched for a way to move into that market sector with a new product. That opportunity turned out to be wood pellets, and he says he's moving a lot of them.
"I always have 15 new ideas going," he says. "We have had substantial double digit growth with our suppliers this year. In 2008, we had double-digit growth as well. If we hadn't diversified, we would have been like the other guys."
Up in New York State's Adirondacks, Sidney "Jay" Ward has started selling chickens through Ward Lumber as well as feed for the poultry. In fact, the dealer has plunged heavily into many types of feed grains at his stores in the towns of Jay and Malone. Ward Lumber carries roughly 90 SKUs for feed alone. It's been a calculated risk, because selling feed is tricky business; it's labor-intensive, spoils, and is highly seasonable. But Ward and his management team felt it made sense in a region where many people keep herds of goats, sheep, and even llamas.
"We are in the business of selling stuff, hopefully, for a profit," he says. "Independent retailers are a pretty creative and risk-taking population. I think the opportunities that the down market has created have allowed us to take some risks while cutting costs as much as possible."
Another risk came when the local Aubuchon hardware store closed 18 months ago and Ward seized the opportunity to add the Glidden line of paints, which Aubuchon had featured, to his inventory. What he found was that not only did the new paint sell well, it also boosted sales of his regular line of Valspar paints. The dealer also added more items to his line of long-handled garden tools to fill a gap left by Aubuchon.
While Ward stresses that the contractor remains the backbone of his business, he also believes in the necessity of diversification in a changing economy. "If we never change and just do what we've always been doing, the world will change around us," he says.
In Carthage, Miss., Dale Joiner likes to say he carries hardware for men and women. The guys may walk out with power tools or fasteners, while the women often leave with bits of hardware they can hang from their necks, ears, or wrists in the form of necklaces, earrings and bracelets.
Yes, Joiner sells jewelry at his full-service building supply store 50 miles northeast of Jackson, the state capital, and he has found it a profitable addition to lumber and drywall.
School uniforms are a new addition to Joiner's inventory. The local school had begun requiring students to wear uniforms a couple of years ago, and when Joiner talked to a Dickies rep at a trade show and found he could purchase uniforms from them, he jumped at the chance. He already owned the jewelry store, which his wife, Yvon, runs, but eight years ago, when Joiner more than quadrupled his 3,500 square foot retail space, he moved her business under the same roof as Joiner's Discount Building Supply.
What Joiner has found is that the jewelry attracts a different customer to the store, and that means both more sales and different kinds of sales. "You can make much more with ladies than with men," Joiner says. "The uniforms will bring in the mamas." And in a recession-battered economy, sales of any kind are a good thing.
Dealers across the country are finding that many opportunities to expand their product lines are leading them into ventures where they can capture women's interest in their offerings.
West Texas LBM dealer Steve Herren has found that operating a bridal registry and selling kitchenware and gifts has brought many more women into his store and made his cash register ring.
The soon-to-be-wed can come to Harris Lumber & Hardware in Big Spring to browse china, crystal, flatware, kitchen gadgets and home decor items.
"This brings traffic through that we wouldn't normally have, and it has helped the bottom line," says Herren, the owner. His wife presides over the registry. He says that when the brides come in to pick out china, "the guys can pick out saws and stuff for themselves."
Brides are not Herren's only patrons for the registry. Customers seeking Christmas and graduation gifts also gravitate to the area. About the only person concerned about Herren's venture into softer side of hardware was the Lenox [china] supplier, who had one request: "Just don't put the display by the chainsaws."
Across West Virginia, Hardman Supply, an LBM dealer with seven locations, is also chasing after women. In space where Hardman's once had a Radio Shack franchise, the Hardman brothers chose to enhance the home decor department.
"We expanded our floor coverings and updated our kitchen and bath department and, new this spring, added a conference room with a flat-screen TV and Internet access for home decor consultations," says Tom Hardman, the dealer's vice president for marketing.
"In our market, there is nothing like this," he says. "Being in a small community like this, by the time we get to realizing a home is going to be built, the female has already gone to the big boxes for kitchens and baths. Now we have a way to capture that. We saw this as a need."
–Kate Tyndall is a contributing editor to ProSales.