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This article was recently published in ProSales magazine and we think it provides valuable insight into ways to think outside of the box and continue to increase sales, even during pressing times. Please read on and enjoy.
Institutional Sales
—By Kate Tyndall 
As residential sales remain weak, dealers are finding that sales to institutions like prisons, hospitals, and colleges can offer a welcome stream of income.
It's a looming presence in many towns, surrounded by razor wire and studded with guard towers. You might drive by your local prison daily. But have you ever thought of selling there? Some lumberyards do, and in these recessionary times, they are more than grateful for the revenue such sales provide.
Sales to prisons require a little extra work in terms of delivery, but because prisoners tend to be pretty hard on materials–"they're liable to throw a cue ball through a window or a chair through a door, and they are really hard on plumbing," says Gary Copp, owner of Carson City (Mich.) Lumber–there is always a need for replacement materials.
In Cameron, Mo., before a Porters Building Center driver can make a delivery to one of two local prisons the yard supplies, manager Shane Hendrix has to ensure that everything is taken out of the truck that might be misused in the wrong hands, such as utility knives and straps. "When we get there, the driver has his ID checked and a guard inspects the truck," he says. "If we have to go in [to the prison yard], someone rides with us."
If the delivery is small, the materials will usually be offloaded onto one of the prison's vehicles at the gate, so the lumberyard's truck doesn't have to enter the prison yard, Hendrix says, which cuts down on his delivery time.
"The guys at the maximum security facility are really easy to deal with, unless they've got something going on, like a delivery of new prisoners," says Hendrix. Then my guys are going, 'Please don't get in my truck."
Porters tends to sell more to the town's medium-security facility, which has a woodworking shop. Typically, the yard sells the prison tools, small pieces of wood, fasteners, and dowel rods.
The only unusual materials request Hendrix got from a prison came from the local medium-security facility, and that was for paint thinner and a lot of small plastic bags, "like sandwich bags," he says. Hendrix still doesn't know what they wanted the stuff for, "but all we know is, don't make a joke about huffing, because they didn't think that was funny."
Along with the unusual materials supplied, penal institutions also differ from home builders in another important way: how fast they pay.
Bill Swanson, general manager of Hoffrichter's West Side Lumber in Pontiac, Ill., whose yard has sold building materials to prisons around the state for years, says that dealers in Illinois typically have to wait 120 days to get paid from the state compared with the usual 40- to 45-day payback for a sale to a private individual.
But slow pay is better than no pay in many parts of the country, so dealers are pursuing all sorts of institutional business besides prisons, including sales to hospitals and universities.
Sales to institutions, including those to the regional hospital in Cameron, account for 10% of Porters' annual business, Hendrix says, and "we'll bend over backwards to keep it. We are beating the bushes for any kind of sales." 
In Des Moines, Iowa, Leachman Lumber sells to all the local hospitals and colleges, says Leachman's president, Jim Kaplan. While these commercial sales only account for 3% of his yard's annual business, Kaplan says, "it's definitely business we want to keep." One reason why, he said, is that with these businesses, "You don't worry so much about whether the economy is down."
At Carson City Lumber, sales to institutions account for just 1% of the yard's annual revenue, but "1% is 1%," Copp says. "It's decent, and it's worth entertaining." Plus, he adds, "you make contact with those people, and they may come back to you with a personal project."
Tim Haley, director of sales, northern division, for Curtis Lumber in Plattsburgh, N.Y., supplies materials to Clinton Correctional Facility, a maximum security prison in nearby Dannemora, as well as Plattsburgh's Champlain Valley Physicians Hospital and the local State University of New York campus. He says sales to these institutions account for about 2% to 3% of the yard's annual revenue. "I definitely think that this is a market to be pursued, especially in today's market," he says.
Eric Spencer, owner of Spencer Home Center in Lexington, Va., agrees. Sales to local prisons, hospitals, and universities account for 5% to 8% of his yard's annual sales revenue. He uses the Commonwealth of Virginia's online service to look up government contracts sent out for bid. Spencer supplies materials to local institutions on both an as-needed and contract basis.
"Each institution in our state has its own discretionary money it can use and not go through the bid system," he explains, "and we do have salesmen call on them." While he acknowledges that as-needed sales "aren't going to be huge home runs for us, if we sell a replacement door and some hardware, that could lead into a larger project."
Many dealers prefer to avoid the paperwork and lowered margins that are attendant on contracts put out for bid, irrespective of the higher dollar values they carry. As Copp notes: "People who request a bid expect a guaranteed bid, but you can end up against the wall due to overuse [of materials] by the contractor or changes that show up in the final blueprints. There can be so many problems that you can lose money."
Buzz Miller, manager of Allen & Allen Co., prefers to get his business from his home base in San Antonio, Texas, but that doesn't stop him from bidding on state contracts. "Nowadays you don't leave any stone unturned," he says. Allen & Allen attributes 10% to 15% of its revenue from institutional sales, and sells to prisons, hospitals, and colleges and universities within 100 miles of San Antonio. Says Miller: "I think some people drive by these institutions without realizing that money can be made."
ABOUT THE AUTHOR
Kate Tyndall is a freelance writer who lives in Washington, D.C. Thanks to Kate Tyndall and ProSales for providing this valuable article.
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Invest Internally for the Best Performance
— By Mike Butts, President, LBM Solutions 
Times are tough, but educating your employees will keep you ahead of the pack.
In this article I want to focus on employee development, specifically on continued development through education and training programs that may be offered by your supplier.
With a declining housing market, job losses, cutbacks and belt-tightening all around us, it's difficult to think about training programs or educational opportunities. But now is the best time to prepare for the future–your future.
The past two years have been very interesting on many fronts, but especially so with regard to the programs I offer through our federated lumber associations, manufacturers, and industry suppliers. I have seen a decline in overall attendance, to be sure, but what is most interesting is the enthusiasm of those who do attend.
Those who came to my programs this past year have been eager to learn and grow, enthusiastic about preparing themselves for continued advancement, and ensuring that they will be in a stronger position to help both their customers and their companies when the market returns. Everyone realizes that our builders, remodeling contractors, and homeowners need professional, dedicated sales and customer service specialists who can meet the ever-changing demands of our industry.
Here is what the attendees learned, and how you can use it, too.
Sales Training. This is more than just meeting and greeting the customer and going beyond the basics to professional account management. A true sales professional in today's LBM industry knows as much about the builder's business as he or she does about the lumber business. These pros need to understand the financial issues that drive a builder, and also how to present a proposal that fully addresses the customer's needs. We must develop sales professionals who go beyond selling simple sticks and sheets to selling total solutions.
True account managers analyze their individual “book of business” regularly to identify where internal opportunity lies. What products are you selling, what products is your customer using, that you’re not providing. If you’re not providing this product – where are they getting it and why?
What will it take to secure this business, how much will this add to your annual sales volume and at what margin? This is part of what it takes to manage an account – not simply take sales as they come.
The same holds true for those who sell to remodeling customers. Yes, they are a bit more difficult to identify, and their need for service is certainly higher, but the rewards are right up there as well. When you develop a relationship with a design-build remodeling contractor and demonstrate your ability to meet its needs for a diverse array of products and service, you've won a very loyal customer.
But, how do you find these customers? Join the local remodeling council, attend the HBA meetings, make yourself visible. Ask your builders about good, high-quality remodelers in your market and introduce yourself to them. Just like prospecting for new builders, you’ll have to win their trust. But please believe me when I say it’ll be worth it.
In many cases, design-build remodeling customers are essentially custom home builders who simply add-on to an existing structure. They have the same needs for product and service, but the emphasis on price isn’t quite as high. They know and appreciate value in product and especially service.
Customer Service Training. Those people in our stores who work at the counter, who walk the aisles meeting and greeting customers every day, deserve nothing but the best in training and education. Customer satisfaction for the retail trade is sometimes difficult to track, but the big boxes fail in this critical area. We have the people, the knowledge, and the local impact; don't discount your image and ability to serve your customers. Reinforce the basics of customer service at every opportunity.
We can’t stress customer service training enough. Everyone in your store, regardless of job title or position, is involved in serving customers - either internal or external customers. The level of service you offer, and the customer’s perception of that service, will determine where they shop in the future. You can hire skills or you can hire attitude. I can teach skills, I can’t teach someone how to smile and say “thank you.”
Yard Foremen and Operations Training. These men and women carry the burden of our industry on their backs every day with very little in the way of thanks, and even less in the way of formal training. My yard foreman classes are always well received. In many cases, this is the first formal program that these people have ever had, and there is so much to the job, including Transportation Department compliance issues, safety compliance, customer service impact, and employee development.
Without thinking about it, this is the most diverse department in the business with the largest physical inventory, in many cases the largest employee group, and certainly the largest operational expense. And its manager is pulled in a dozen directions every day.
Don't turn your back on employee development. Take advantage of the educational and training opportunities offered to you, whether I am the instructor or it's someone else. The right employee is your greatest asset, and that employee is one that is well trained, has the proper tools, has motivation to do the job right, and is ready to help carry your business into the future.
ABOUT THE AUTHOR
Mike firmly believes that professional training and educational programs are investments in a company's future that will return positive dividends in increased efficiency, improved margins, increased customer service and ultimately in a more successful and balanced business. Mike is at the forefront of the Installed Sales movements in the lumber industry with a number of years of practical "hands-on" implementations and experience in developing and managing successful Installed Sales programs at the dealer level.
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Therma-Tru® Doors and Huttig Partner in Offering Core Installation Training
Angry builders, contractors and consumers. Leaking doors, damage claims and lost revenue. These are situations we all want to avoid. They can affect our reputation and require many man hours to conduct field inspections, determine the reason for failure and correct issues. Upon analysis, the majority of door system field failures are tied to inadequate installation and water management techniques. As a manufacturer, Therma-Tru Doors understands the importance of producing quality products and working with Huttig to provide the easiest operating door system in the industry. The full-system approach, which is the landmark of Therma-Tru. makes this possible because all components are engineered to function and perform together.
In 2009, Therma-Tru created a new team within the existing sales team appropriately named Technical Sales. One of the primary goals of the team is to sponsor installation and troubleshooting clinics in order to educate builders, contractors, sales reps and other interested channel partners. In order to meet this goal, we have established training curriculums that are tailored to our target audiences, which consist of lecture, video and a practical “hands-on” application of a door system that gets installed into a simulated rough opening. The training is 2 to 4 hours in duration and is broken down by the following topics:
- How to measure openings for remodeling and replacement applications
- How to prepare the opening
- Best practices for installing weather resistive barriers, flexible flashing and sill pans
- How to install various door system configurations (shimming and adjusting the door)
- The sharing of pro-tips for making final adjustments and dealing with unique applications
This training is ideal for veterans as a refresher or for newer employees.Upon conclusion of the training, attendees will be eligible to receive a certificate that demonstrates their completion of this continuing education course.
Therma-Tru and Huttig are happy to coordinate with customers seeking to learn more about attending one of these installation best practices sessions. For more information and for scheduling options contact Misty Giddings at 260-868-5811 x2255 or talk with your Huttig OSR.Forward to Friend
Masonite® Palazzo Series®
Masonite’s Palazzo Series® Molded Panels Doors are the ultimate in composite wood door design. They embody the true definition of elegance and the meaning of fine architecture, featuring distinct raised moulding combined with unique high-definition panel profiles.
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Palazzo is offered in three European-inspired designs:
- Bellagio® - featuring 2 arched panels and patented raised moulding.
- Capri® - featuring 2 square panels and patented raised moulding
- Treviso™ - featuring a 3-panel camber-top design with raised moulding that embodies a classic European door layout
All three Palazzo designs add sophistication to any room. Plus, their exceptionally smooth surface is ideal for painting and decorating. These doors are also environmentally beautiful as the door Facings are made with by-product wood chips.
Tell us about Masonite doors for your chance to win 1 of 4 iPod Nanos! Click the SURVEY tab in this month's Dealer Digest.
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Greetings from Central New Hampshire!
Welcome to the October edition of Dealer Digest. This month we have a variety of helpful tips for you. Our two feature articles provide great insight on how you can improve your sales force and increase your sales by pursuing new channels, but we also have an exciting event coming up that we would like to share with you!
Huttig Greener Selections is coming to Boston! This event, held on October 14th in Norwood, MA, features industry speakers, Mark LaLiberte and Gord Cooke and discusses several topics that are relevant to you and your customers – Selling Green, Can it be Profitable? And Implementing Green, What Next? The event is completely FREE to you and we will provide continental breakfast, lunch and afternoon snacks. Plus, the first 100 people to register will receive a free copy of Jerry Yudelson’s, Green Building A to Z: Understanding the Language of Green Building. For more information and to register, visit www.greenerselectionsworkshop.com.
Also, please note that Huttig has a variety of sales promotions this fall to help you drive sales. Forward this information to others within your organization or tell them to sign up at www.huttigdealer.com to ensure they are taking advantage of these helpful educational and sales-driving tools.
Thanks for your continued support of Huttig Central New Hampshire. We are here to serve you, so feel free to contact us with any questions or special requests.
Thanks!
Ken Schmitt • Central New Hampshire GM •
Swing for the Fences
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Educate Your Builders -
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