Wolf

The Independent Dealer and the New Normal

Tom Wolf published this article on February 6, 2012 in Build your Business. No comments. | Comment

Predictably, much of the chatter at the most recent Northeastern Retail Lumbermen’s Association (NRLA) Show revolved around the economy.  While the weather in the northeastern part of the country has been very good to the residential construction industry so far this winter, no one believes that new construction will ever boost independent dealer sales like it did just a few years back.  The channel will always remember with great affection the post World War II single family home construction boom that gave most independent dealers a sure – if sometimes lumpy – foundation for growth and success.  But dealers know that there is a new normal out there.  And the job now is to look for a new foundation for growth and success.  Big project remodeling might be the answer.

Independent dealers have always dominated the residential – especially single family – new construction market.  But they have also done a very good job serving the professionals and serious do-it-yourselfers tackling big remodeling projects.  The problem has been that in many areas over the past few decades, the boom in new construction was so good that it led many independents to take their eyes off the remodeling portion of their customer base.  The recent decline in new residential construction – and the increasing suspicion that it won’t come back soon – suggests that it’s time for independent dealers to take a fresh look at their old remodeling talents.

The independent dealer channel does indeed have some innate advantages here.  Most independent dealers know their customers, they know a lot about the products they sell, they stay close to their vendors (some of whom cater exclusively to the independent dealer channel), and know how to serve them well.  They have a lot to offer the big project customers out there.

Coincidentally, it turns out that right now there are a lot of people thinking about big project remodeling jobs like new kitchens, room additions and decks.  These folks are looking for the kind of solutions independent dealers can best provide.  No one knows more about the products they sell than independent dealers; no one offers better products; and – increasingly – no one has better prices on the kinds of products big remodeling projects require.  There is no reason, in other words, why anyone taking on such a project should want to go anywhere else.

The progressive dealers at the NRLA Show were well aware that the steady stream of demand from new residential construction will not come back any time soon – if ever.  This is the bad news.  The good news is that the independent dealer still has great options.  Big project remodeling customers present the best of these options.  No one can give this customer – professional or serious do-it-yourselfer – the counsel, products or prices that efficient, well-run independent dealers can provide.  That’s the truth.  And that truth just might be the foundation for an exciting and profitable new future for the independent dealer channel.