In a volatile industry such as ours, where success hinges partially on externalities such as the economy, weather, competition, and commodity markets, celebrating an anniversary can be an especially laudable achievement. But success is not solely determined by how a pro dealer navigates through the external factors. For Central Valley Builders Supply (CVBS)—which celebrates its 50th anniversary this year—longevity and success have meant placing a high value on customer service. And while many of the basic tenets of customer service—broad inventory, good quality, knowledgeable help—remain as necessary today as they did 50 years ago, they do not carry the same weight: Most have evolved from services into basic expectations. To survive, the dealer is compelled to increase existing service levels and uncover new opportunities.
Like many dealers, CVBS has employed numerous tools for generating customer feedback over the years, including using comment cards and conducting focus groups that either did not produce sufficient information or were implemented too infrequently to establish any relevant, usable results. And while we have always received valuable market advice from our outside sales force, that intelligence comes with its own inherent bias—the focus is placed on our largest and most obvious customer segment: our larger, delivery-only contractors where we tend to already have a solid relationship and a comprehensive understanding of service requirements.
To help CVBS obtain a greater knowledge of the different needs of the entire spectrum of players in our market, we endeavored to find out more about our underserved segments through a customer-wide satisfaction survey. Since more than one-quarter of our client base is custom builders, and another small percentage includes remodelers, the danger of not focusing our market research beyond our primary customers was clear: We were missing lucrative opportunities.
Conducted in July 2005 and distributed to a large percentage of our entire customer base, the survey's preliminary objective was to uncover additional information regarding specific customer values. The simple one-page document solicited basic customer information, including where they shopped, purpose for shopping, what they liked most about their CVBS experience, and what they'd like to see improved. It also requested they rank the importance of, and their satisfaction with CVBS on, various attributes such as employee availability, response time to inquiries, and invoicing and order fulfillment accuracy.
We found the initial response rate to be very encouraging—many customers even thanked us for caring enough to actually ask about their service needs and preferences.
The survey results themselves were surprising, and they varied depending upon the customer type, as different segments placed greater importance on certain attributes more than others. Inventory on the ground, for example, tended to be more important to the walk-in consumer, whether a do-it-yourselfer or small contractor, than to a large builder that has most of its product delivered. Inventory size was not as important to the larger builder so long as its criteria of prompt delivery, correct quantities, and pricing accuracy were met. The walk-in customer experienced a high-degree of frustration if the product was not available and consequently shopped elsewhere, leading to lost revenue for CVBS.
As is the case with many surveys, responses to our original inquiries have led to additional questions: What are the correct inventory levels for the walk-in consumer? Which products are critical? What can CVBS do to ensure higher fill-rates? What is the consumer willing to pay for these services? By answering these questions and others through future customer surveys, we will be able to develop a greater understanding of customer preferences, expansion opportunities, and profit potential.
Our plan is to select the two or three key discoveries with the greatest potential for immediate impact and, if necessary, probe further using specific surveys or segment-specific focus groups. These results will be used in conjunction with all of our outreach efforts to guide future strategic decisions pertaining to product lines, services, employee training, and business processes. At CVBS, we're looking forward to another 50 years of success and longevity, and if we do not make the consistent effort to understand and attend to the service requirements of all of our customers, someone else will.
Steve Patterson, President, Central Valley Builders Supply, St. Helena, Calif.
