How to get dollars for R&R

A GOOD relationship wirh the ll store's banker can be an asset in cultivating repair and remodeling business. With his help, a dealer can make it easier for customers to finance the materials and work needed for residential improvements.

Over half of the 95 billion home improvement dollars spent in 1986 financed residential additions and alterations-projects which cost big bucks. Statistics show that borrowed money paid for a high percentage of this expenditure.

With the new tax code, home equity loan interest and home mortgage interest are deductible on borrowed amounts up to the value of the home. This makes home improvement a good buy for many homeowners.

By contacting the store's business banker to learn the various procedures which a customer can follow to obtain credit for additions and major alterations, management can counter sales resistance due to lack of money. Financing alternatives should be part of the sales presentation made by people working with customers about to undertake major remodeling projects.

Printed guidelines can be used as handouts. However, in all cases, it is advisable to emphasize that the information is offered only as a guide and that the store gives no guarantee and takes no responsibility for its ac- curacy or the ability of the customer to qualify for such financing.

Bankers in some communities have been extremely cooperative with lumber and building material dealers. One dealer was able to work out an arrangement in which he put a remodeling display in the lobby of his bank. In exchange for the promotion, which prominently featured his name, address and telephone number, he made loan applications and the loan officer's cards available to customers about to begin additions or alteration to their homes.

This arrangement worked well enough to be continued for several years. Although the dealer who used it has outgrown the need for such a promotion, he stillrecommends it as a way to beef up remodeling business.

Home improvements not as expensive as remodeling can often be financed on a customer's consumer credit card. lf a store does not offer credit card service and wants to add such a plan, arrangements can usual-

Story at a Glance

Ways to help customers bank- roll R&R projects. cq)per- ative ventures with business bankers. .. in-house credit with bank or private label cards.

ly be made through the financial banker. Private label credit cards can be obtained through buying groups. Consumer credit cards whether used for large ticket items or everyday shopping are the fastest growing form of short term credit. In just 10 years there has been an 86% increase in consumer credit cards. Statistics show that over 600/o of these credit cards, which can be used in most retail stores, are held by those in the primary do-it-yourself age group of 25-54. Nearly 700/o of the cards are issued to families with annual income in the $20 to $30 thousand range, qualifying them as good potential buyers. Studies have shown that customers who pay with plastic shop more often than those who pay cash.

Stores which sell to contractors on account can encourage remodeling contractor business by giving their names to customers who ask for contractor recommendations. This can build both buy-it-yourself and contractor business.

Financial bankers also can be helpful to retailers by helping them to arrange financing programs in conjunction with remodeling seminars. This type of information is applicable to any store clinic involving large expenditures.

Regardless of how they do it, stores that help customers find financing for big ticket projects usually benefit.

Fl AINT seems to be a forgotten l- product in many home centers, yet statistics show that more is being spent on paint each year and that it can outsell other products on a Per square foot of sales area basis.

Dealers who want to imProve paint sales should examine their paint department, asking themselves the following questions.

ls the product good?

Is the service good?

Am I advertising and promoting the product?

ls the product being displaYed well in an attractive area?

Although the price of a store's paint is probably determined by the income level in the market, consumers are usually looking for more than a bargain in paint. TheY want a quality product with ease of application, hiding power and durabilitY, whether it is a private label or a national brand.

Good service begins with sales people who can recommend suitable paint for specific surfaces, answer basic questions about gloss levels and color, estimate the amount of paint a customer needs and give suggestions for application. One or two sales people should be ofthe decorator type, able to discuss color schemes and make recommendations.

In discussing the need to offer advice and assistance to do-it-yourselfers, John Bryan, marketing manager, Norton Co. consumer Products division, said, "Your chances to cross merchandise increase the minute you engage a do-it-yourselfer in a how-to conversation, and you've started to build long-term customer loyalty as well. Both of these factors will have a positive imPact on Your bottom line."

Service includes being able to custom match and custom mix Paint. Many stores have computer systems which can match any color swatch. Availability of fashion colors such as pistachio, peach, sagebrush and white asparagus will draw customers. Advertising and promotion begin with letting your trade area know your people are paint exPerts through newspaper, radio, tv and direct mail advertising. Color advertising is recommended for Paint. Advertising sundries as well can be helpful since a paint project can not be successful without quality tools and related materials.

In-store displays should stress the benefits of paint. Dramatic use of color, vignettes showing end use, color bars with myriads of paint chips, shelf talkers, mobiles and point of purchase displays attract attention. The atmosphere must be colorful and attractive without being cluttered. Paint related sundries should be included or cross merchandised with displays and signing.

Story at a Glance

Tips on improving paint sales .organizing advertising, PrG motion... setting up section spotlighting service.. sales aids available.

colorful and adjacent to paint sundries.

Paint promotions can include having classes related to painting such as decorating, wallpapering, furniture stripping, staining and finishing. Some dealers find it helpful to maintain a demonstration area where a customer can try out various paints and colors before making a purchase.

The dealer who is not satisfied with his analysis of the paint department has several sources to call upon for merchandising help. The National Decorating Products Association, 1050 N. Lindbergh Blvd., St. Louis, Mo. 63132-2994, (314) 9913470, publishes a monthly magazine, Decorating Retailer, filled with helpful ideas. They also have a store planning guide available and several audiovisuals with booklets on topics such as selling interior and exterior paints.

Location of the paint section depends upon which theorY You accept. onb is that it should be close to the front ofthe store so that carryout will be convenient. Another is that the section should be in the back as close as possible to the storage area with most of the stock kept there. Regardless of location within the store, the paint section must be

The National Paint & Coatings Association, 1500 Rhode lsland Ave., N.W., Washington., D.C. 2000s, Q02) 462-6272, has numerous leaflets available plus a paperback book on paint selection. This material is good for customer reference or handouts as well as a source of ideas for vignettes and displays.