A love—and in-depth knowledge—of retail has helped set Gillman Home Centers apart from the competition
Charlie Gillman knows retail like mothers know their children. Over his 32 years in business at Gillman Home Center, this former builder has sold everything from mattresses to guitar accessories, and his retail instincts have allowed him to grow his business from one location to eight, serving southeastern Indiana and southwestern Ohio. Thanks in part to a 15.7% sales increase last year from 2014, Gillman's total sales rose to $44.3 million and Gillman secured the final spot on this year's ProSales 100.
Charlie’s father was a home builder, who bought a mom-and-pop lumberyard primarily to serve his own construction company’s needs. Charlie worked in construction for years, and was the only one of 10 kids interested in joining his father in the lumber business.
Without doubt, part of Gillman’s interest in the retail side of the lumber business is the ongoing challenge to develop just the right mix of product for a particular community—as well as the ability to sense when to pull a product and move on to the next thing. He ticks off the three things that fuel his business success: “We tailor our stores to the town we’re in; we buy incredibly well; and we are good at pricing.”
A Shopping Nightmare Leads to a Revelation
Take those mattresses, for example. Gillman wasn’t looking to add mattresses to his inventory; his wife wanted a new mattress for their bedroom, and as he tells it, “She was wearing me out, mattress shopping. There’s not enough alcohol in the world for that.”
But as luck would have it, a young mattress salesman came to his Oxford, Ohio, store and made a pitch for Gillman to carry his product. When Gillman told him he was looking for a mattress himself, the salesman promised to have one at his house in three days for $1,000. But what the young man told him about margins really got him thinking.
“The margin on mattresses is 50%; the margin on appliances is 15%.” He’d long avoided appliances, but mattresses had him seeing a financial opportunity. “We put mattresses in three locations where no one else sells mattresses.”
On the flip side of the coin, Gillman also knows what not to stock. “We won’t sell light fixtures,” he says. “Our stores are 18,000 square feet. Lowe’s [stores] are 100,000. If people want to look at light fixtures, they want to see hundreds of them. We’ll do special order but that’s it.”
Gillman’s philosophy of business is simple: “Take care of your employees, work hard, and play hard. I tell everybody who I hire, ‘If you aren’t happy, I want to know about it. I want you to love coming to work at Gillman Home Centers.’”
His business card lists his cell phone number, and he makes it clear to his employees that he wants them to call him if they have a problem. “I take a personal interest in my employees, and I make myself available to them.”
Incentives play a role in keeping employees motivated, and every month Gillman gives $100 gift cards to salespeople who have made high sales with good margins. Every employee gets a call from the boss on his or her birthday, and Gillman and his wife, who love to entertain, every summer throw a big party for the company employees, 200 strong, and their families.
'Hire the Smile, Teach the Trade'
“We promote from within, and there’s not a lot of turnover in the company,” Gillman says. But when he is looking outside to hire, he’s not dead set on finding someone with an LBM background. Gillman is a believer in the adage, “Hire the smile, teach the trade,” and says he’s had great success in hiring people from nontraditional places.
“The biggest thing we fight is the perception that the big boxes are cheaper,” Gillman says. “I send my employees to Lowe’s or the other big boxes to check prices, and they are marking them up a lot more than us.” He fights that perception with any means handy, including water and soft drinks. “We’ll buy it by the case, and sell water for 20 cents a bottle. We sell our bottled pop at 69 or 89 cents apiece at a very low margin, and if that’s the last thing a customer buys from the store, then they think all the prices are low.”
Gillman saves money by buying delivery vehicles for the store at auction and repairing them at the garage he opened six months ago. His contractor background has helped him greatly in being able to use his own crew to rehab existing stores he has bought and build new ones.
But he also knows how to spend it: To celebrate his recent 60th birthday, Gillman threw a party and invited all his employees. The celebration included an open bar, hot hors d’oeuvres, live music, a hypnotist, and a magician for the kids.
“We will take on anybody’s price all day long, but at the end of the day, it’s service. Service is an overused word, but the first thing you sell is yourself. If we aren’t pleasant to deal with, nobody will care.”