Competitive, aggressive, unique. Simply and succinctly, these words sum up Petaluma, Calif.–based Golden State Lumber, the largest California pro dealer, the 14th-largest dealer in the nation, and the 2005 PROSALES Dealer of the Year. With only four yards, a satellite sales office, and a corporate headquarters handling back-end accounting and administration, Golden State has a well-earned reputation as one of the industry's leanest and meanest supply operations. In 2004, the company posted an organic sales increase of 42.4 percent and raked in an astounding $866,000 in sales per employee, continuing a track record that annually sees the family-owned, independent pro dealer at the top of industry growth and efficiency curves. This year the company expects to again raise the bar, again approaching approximately $1 million in sales per employee for an estimated year-end take of $460 million in gross sales. With recent investments in a wall panel plant, construction underway on the company's first design center and roof truss facility, and investments in technology to streamline inventory, dispatch, and delivery, the Golden State team is poised to remain an industry leader for years to come.
But even with these successes that have earned the dealer its competitive and aggressive description, perhaps the most surprising moniker that also characterizes the Golden State team is the one they hang on themselves: dissatisfied. Despite the uncontestable financial numbers and the kudos from contractors and suppliers who have allied themselves with the pro dealer, Golden State executives say efficiency always remains elusive, and they stress that there is still work to be done to solidify the dealer's position as the undisputed Northern California market leader.
"We are still miles from where we want to be," says Rick Zaslove, now solely in charge of operations as Golden State president after the November 2005 departure of longtime company president Wayne Withers, who had shared operational and strategic management duties with Zaslove since 1992. "We're just beginning to think and operate like one company now rather than competing yards," Zaslove says. "It's a push to be smarter as businesspeople, to capture more dollars per house, to enable our customers to buy from different sales-people and different yards, but still only deal with one bill. Our goal driving that [initiative] is the same as it has always been: to help our builders and vendors meet their growth goals and to help them on their mission to reduce costs."
Stalwart Competitors
Strategically located around the San Francisco Bay, Golden State's locations feed off of luxury home building in Marin, Sonoma, and Napa counties; commercial, remodel, and infill opportunities in greater San Francisco; multifamily and suburban subdivisions in Oakland and the East Bay; and surging big builder activity in nearby Stockton, Livermore, and San Jose. Until now, the company's four yards and one satellite sales office have been content to rub shoulders in their respective markets as the company grew, often selling into each other's territories with a healthy but competitive camaraderie.
"We've always been a competitive company," explains Jessica Nobmann, who has been managing Golden State's Sierra Point yard for a year. As the daughter of company owner Lee Nobmann, Jessica has perhaps felt the competitive pressure a bit more in the past three years since officially joining Golden State, first in the accounting division at the corporate headquarters, then acting as a liaison between locations as the company embarked on an initiative to cut inventory by 15 percent before settling down to day-to-day operations at Sierra Point. "The whole experience has been a trial by fire, and of course I feel like I have to prove myself, but then again this is an industry where you have to prove yourself to your customers every day."
More than anything else, Golden State employees and management agree the key factor in the company's financial successes over the past 20 years—only three of which (1990, 1991, and 2002) did not see same-store sales growth in excess of 20 percent—has been the day-in, day-out drive to live up to their sales machine market reputation. "Perfectionists are never satisfied with where they are," says Edward Minton, general manager of Golden State's Newark location. Despite holding a brown belt in Korean Kendo karate and having raced motocross professionally for a decade before joining the company in 1997, Minton says he's never experienced the level of energy that he feels working with the entire Golden State team. "When you have that drive and a competitive spirit, you always want to be better. And when I say better I mean great. I mean the best."
That drive has led the dealer into unique forays such as being the only pro dealer to exhibit at the annual Pacific Coast Builders Conference in San Francisco and sponsoring a PASS (purchasing agents, subcontractors, and suppliers) luncheon where the company gave away a trip for two to Las Vegas and showed a 10-minute video highlighting the capabilities of the company's Stockton wall panel plant. The video, shot from a helicopter, follows a panel project from delivery of raw lumber to tilt-up at the jobsite, and pulses with a soundtrack from heavy metal band AC/DC.
Indeed, Golden State is not bashful about the competitive zeal that streaks through the company culture, and builder-customers and vendors alike are taking notice. "They can walk the walk and talk the talk, that's for sure," says Rick Everharte, president and CEO of Pleasanton, Calif.–based Ridgeline Framers, a production framing company that completed 1,100 single-family homes in 2005 utilizing panels from the Stockton plant. Everharte says he started using Golden State in 1999, and almost went with another yard after his initial salesperson wasn't well-versed in production framing. "[Golden State] management sat down and talked to me, asked for another shot, asked to prove themselves to me, and for six years they have been true to their word," says Everharte. "They'll go the extra yard if I need a delivery on a Saturday; they immediately respond if I need something stepped up; they will always do what I need them to do." Everharte adds that Golden State approaches businesses from a partnership standpoint that helped his company reach $37 million in 2005 sales. Golden State's benefit of that success: approximately $13 million in Ridgeline purchasing.
"Of course the sheer volume that they do is mind boggling," comments Chuck Scott, a sales manager who handles the Golden State account for Chesterfield, Mo.–based distributor Huttig Building Products, which supplies the dealer with a vast array of building products and hardlines, including hangers, caulk, housewrap, and fasteners. "When they come to work, they bring their lunch, and by that I mean they are not complacent about their business. They have an aggressive sales team, and they partner with builders. They are so dialed-in to what they do—and what they do, they do really well. If I was a retailer competing against them, it would be a tough challenge."
