Why youshould offer installation services

By Roy Burleson

r[tRYING to stay profitable while I builders are demanding better pricing is a daunting task in today's construction environment. What should you do? How can you maintain margins during these ultra-competitive times? Offering installation services may be the answer.

More and more dealers realize that being a supplier means more than delivering a load of building materials. Even when you supply every single piece of material that goes into a house, you still are only capturing a portion of the project's potential revenue. By installing one or more products for your builder customers, and essentially becoming a subcontractor, you will enjoy a larger slice of the home's potential income.

More dealers are adding services to their "supplier offerings" and not limiting themselves to material-only income. If your material sales are down, why not make up the difference by offering and charging for installation services? The builder is going to write a check to someone, why not you?

Put yourself in the builder's shoes for a moment. Two salesmen are vying for your business. One wants a shot at quoting all or part of the housing package. This is a pretty lame (value) approach, but is done every day. This approach also puts the sales- man in a defensive posture with respect to price. Bidding and quoting tends to scream lower prices.

The second salesperson qualifies the builders and offers a solutionbased installed sales proposal.

David Pelletier, president of Pelletier's Building Supply Co., with locations in Fitchburg and Gardner, Ma., says, "It is dramatically easier to find a builder who is unhappy with a sub these days than it is to find a builder who is unhappy with his last lumber drop. This value proposition takes the focus off price and spotlights value-added services. It's a solutionbased proposal that is superior to the previous salesperson's bidding approach."

Now shift gears for a moment and put yourself in the salesman's shoes. Would you rather compete by matching or beating current prices or by offering builder customers and prospects solutions? The answer is obvious. Good salespeople want to sell meaningful, tangible solutions. And frequently, value-added solutions can help the builder actually lower costs. Using one organization for supply and install is easier for the builder to manage. Top producing salespeople don't want to be limited to simply bidding projects. Not only do installed sales help increase sales and margins, it attracts better salespeople.

Most dealers today offer value propositions that include take-off services, delivery and extended (ugh) terms. In most parts of the country, these are the table stakes just to enter the game. However, if your competition is offering similar or identical services, what is really differentiating you from your competition?

Service olferings are a moving target. Why do you think they now have 10-minute oil changes, services that offer eyeglasses in 60 minutes. prepackaged foods at your local grocery store, liberal return policies at your finer department stores, personal shoppers, etc. Everyone wants to save time, which in the business world translates into money.

A properly executed installed sales program offers you several major business benefits. The service is a great sales tool. Numerous dealers have reported that offering installation services helps them get in thedoor with new prospects. These dealers become subcontractors first and then ultimately end up supplying housing packages. It also takes the focus off price, which aids in maintaining acceptable margins.

And last, an installed sales program is a good tool for recruiting top salespeople. Three great reasons to offer installed sales or add to your existing program.

- Roy Burleson is director of Builder Solutions for Guardian Building Products, Greer, S.C. Contact him at (248) 760-5791 or roybur I e so n@ bp.gua rd ian.c om.