"Spurtability" was first used by NBA and NFL draftniks in describing a player's ability to quickly accelerate to a new speed on the fly. Tough to quantitatively measure, but easy to recognize; the same "spurtability" is easy to recognize at the most successful lumber yards around the country. The ability to quickly switch to another gear and handle a significant order from a new customer in a timely manner, work with a supplier to double a special order for a customer that has seen a sudden surge of business, or submit timely and organized invoices for a customer with an accelerated real estate closing are all "spurtability" measurements in the LBM industry.

Mike Potthoff
Mike Potthoff

Not only do LBM dealers face moments of "spurtability" at their local operation, but also larger global and economic pressures have become more volatile. We are facing artificially suppressed inflation ready to pop, a dynamite keg in the Middle East ready to explode and double oil prices, difficult decisions facing the Far East regarding population and currency control, and a U.S. government that has the pendulum of "correct amount of government intervention" swinging more wildly than ever before. Everyone else has seen double digit growth and crashes in the last year but are you ready for them in the same year? The era of consistent quarter over quarter growth in our markets at a rate slightly higher than inflation is not going to return for the foreseeable future.

My question to the LBM dealer industry: do you still have spurtability? If you doubled your sales in one month would your sales, yard, and accounting staff be able to handle the increased work load? Have you trimmed back your inventory levels for cash management so far that you wouldn't be able to handle the rush? Are your suppliers and bankers flexible enough to handle this surge in business?

Here is what you as a LBM dealer can do to handle these spurts:

  • Make cash king: If your vendor is offering extended terms on one of your "B" items for an extended purchase, Punt! The price increase that you might face in 4 months won't be more significant than that "B" item quickly turning into a "D" item and your cash is tied up in dead inventory when that large rush order comes in from a new customer.
  • Manage banks like you manage your best salesman: They both are key components to your business, but in their own mind think they are exclusively responsible for the success and existence of the LBM dealer. Continue to keep banks as involved and updated as necessary and quickly relay praise to your sales team when the "spurts" happen.
  • Practice yoga and find your namaste: Your flexibility and ability to stay calm will determine how much of the next spurt you will get. Keep your sales force out in the field; keep pricing visible, current and transparent; and keep an open dialogue with your vendors are all ways to handle the next rush in business.
  • Text like your teenage daughter: If you are seeing an abnormal increase in business over the past few days, text your biggest builders and let them know you are busy but ready to handle their orders. It never hurts to ask for more business with a quick text message reminding your best customers of your new product or a forgotten product line.

Mike Potthoff is the general manager of LBM dealer solutions as DMSi, the software solution company. He has experience in the LBM industry through working at a lumberyard and selling software solutions and programs to dealers around the country.