While visiting one of our locations last month, the market manager, an outside sales rep, and I went out for lunch. We chose a place called Five Guys. It sells burgers, fries and drinks–that's it. You want a salad? Go someplace else. You want a chicken sandwich? Go someplace else. You can get a hot dog, but that's about it. And oh yes–Five Guys is so popular, it plans to open 200 restaurants this year alone.
According to its website, www.fiveguys.com:
- There are more than 250,000 possible ways to order a burger at Five Guys.
- It uses only fresh ground beef.
- There are no freezers in Five Guys locations, just coolers. Nothing is ever frozen.
- It uses only peanut oil.
- The menu is trans-fat free.
Five Guys doesn't try to cater to everyone who walks down the street, nor does it try to be all things to those people who do come in. Instead, it focuses on a few, in-demand items and then executes its tasks very well. The food was great, service was outstanding, prices were reasonable. What does this have to do with the LBM industry as a whole and installed sales in particular? Plenty. I can't count the number of times I've been approached by a dealer, manager or sales rep asking: "Do you think we need to add this and this to our installed offerings?" Or: "We're only installing windows and doors–do we need to do more?"
There's also the classic situation in which an outside sales rep agrees to install some off-the-wall product for a customer. He/she may not possess any knowledge of how to bid that job, no clue as to where to find an installer, and no idea of how to measure the success of the project. But this rep still will say yes to the customer and go forward.
In my opinion, you should focus clearly and specifically on a few, core products to start or maintain a program. Decide what you are really good at, what products you and your team can estimate accurately, and what you possess the talent to install (or have installers readily available to install for you). Also, what products do you stock and what's in demand by your core customer group? Hopefully, these two will converge and provide you with a solution for your customers.
Take four or five products, become the very best that you can possibly be, and "blow up" your market. By that, I mean identify the top 10% of your customers. Target this group with your installed product/service offering until you've gotten 100% penetration into that group. Don't even think of adding another product or service or going after any more customers. Own the market.
Focus on your core customer group. Are you a pro-oriented dealer that caters only to builders and contractors? Do you have a large retail trade and want to install products in the remodel/retrofit arena? Is there another market that you serve, possibly light commercial? Identify the group you want to serve, list the products that are in demand by your customers, ensure you can estimate jobs accurately and quickly, and line up your installers. Then move this process to the next level.
Many times I see dealers try to leapfrog the process in an effort to build a business quickly. It simply cannot be done. You can't do an end run when building a house, and you can't do it when operating an installed sales program, either.
I'll have a cheeseburger and fries, please. Nice and simple.
Mike Butts is director of installed sales at Stock Building Supply. 517.256.9337. E-mail: [email protected]