An ALLPRO® Publication VOL. 23, ISSUE 7 JANUARY / FEBRUARY 2014
By: Kelley Anderson
Creating S.M.A.R.T. Goals
To qualify as S.M.A.R.T. a goal must be:
It’s the beginning of another new year and another fresh start. By now most of us have had time to reflect on the previous year and, if nothing else, take a mental inventory of our successes and failures. We invariably approach each new year with every intention of building on the previous year’s successes and minimizing those problem areas. That axiom is true whether you’re a single store operator or a multi-store chain. Building on your success and reaching new goals depends largely on something as simple as how well you communicate with your employees. Are you sharing those learned lessons with your employees? Have they been given clear direction and do they know what is expected of them?
SPECIFIC- Specific goals let people know exactly what's expected of them leaving no room for misinterpretation. Specific goals should be able to answer the following: What needs to be accomplished? Who is responsible? When must this be completed? Why is this important to the company?
Like any other business, your employees represent both your company’s biggest expense, and your most valuable asset. Ultimately, your company’s productivity and profitability depends on your employees performing to their full potential. Studies show a dramatic increase in both employee and business performance when an organization effectively sets and closely links employee goals to the company’s overall business strategy. However, according to Robert Kaplan and David P. Norton of the Harvard School Press, "a mere 7% of employees today fully understand their company's business strategies and what's expected of them in order to help achieve company goals”. Effectively setting and closely aligning employee and business goals is critically important in any business. Your employees must clearly understand how their individual work serves both the shortand long-term goals of your business. To be most effective, goals should pass the S.M.A.R.T. test and be specific, measurable, attainable, relevant and timely. Following the S.M.A.R.T. guidelines provides clarity to your employees who will eventually be evaluated against these goals. Utilizing the S.M.A.R.T. method has proven to be very effective in motivating employees to perform at peak levels.
MEASURABLE- When setting goals, you must also set specific criteria for measuring the progress and achievement of those goals. This motivates your employees to plan, aim for target dates, and reach objectives. ATTAINABLE - Setting unattainable goals serves to demotivate, rather than motivate, your employees. By setting ambitious, yet practical, goals you will inspire your employees to fully leverage their abilities and all available opportunities in order to achieve them. RELEVANT - Employees must be able to see how a specific goal is relevant to them and the work they perform in your company. Additionally, by keeping goals relevant, you will help employees better understand their connection to your company's objectives and the importance of their individual goals. TIMELY - To be most effective, goals must have a clearly defined time-frame including a target or deadline date. This provides a sense of urgency and serves to motivate individuals to begin working on their goals immediately. When your employees see how they can make a direct contribution to your company's success, they begin to focus on working more efficiently. So as you start to set those business goals for 2014 keep these ideas in mind, and remember that with the start of 2014 come endless possibilities. The ALLPRO team wishes you all a prosperous and happy new year!
How to Benefit from PaintCare Stewardship Programs
components you may have to deal with. Here are some basics: • An assessment is charged to the manufacturer for qualified recyclable products shipped into a PaintCare covered state. This assessment flows through to the retailer, sometimes through several steps of distribution. • The retailer then adds the charge into the purchase price at the time of purchase. You may be required by law to show the recovery fee assessment as a separate line item on your sales receipts, or this may be optional. This is an area where it makes good sense to follow your competition as it can eliminate confusion to the consumer. However you decide, stick with it and remain consistent. For the first year or so we had to remind our contractors and volume purchasers to add the recovery fee to their costs. Most of us have lost a job over a smaller margin than the 75 cent per gallon recovery fee. If one day you quote prices to a contractor excluding the fee, and then add it the next, you could create an unwanted service issue.
By Craig Bond Out here in Oregon we talk slow, wear socks and sandals (together), and care deeply for the environment. I don’t know if it is really a cultural difference, or if it’s just because we have some environment left to take care of. Many folks back east consider our entire state to be one large National Forest, so it was no surprise when in 2009 Oregon enacted legislation which established a statewide paint stewardship pilot program. Perhaps the only real surprise is California wasn’t first, but they weren’t far behind as their program started in 2012. Connecticut came on board this year, and Rhode Island will start a recycling program in 2014. Laws are in the books to create programs in Vermont, Minnesota and Maine by 2015.
Assessment Charges: Be aware you will have to make some adjustments to your POS system to accommodate the assessment charges. The good news is the providers of this type of software are well prepared with solutions developed for the states which have been implementing the program for a few years now. Even though the framework for the solution exists you are still going to have some work ahead. Within your inventory you will have products which qualify for the recycling program, and those that don’t. In general, you only want to recover the fee for an item if you are charged one by the vendor you purchased it from. For example, two-component products are not considered recyclable and therefore are not charged an assessment upon purchase from the manufacturer. You aren’t going to charge for a fee you didn’t pay (are you?), so you need a method of turning off the assessment on this specific product, or class of product. This all depends on how your point of sale system is set up, but I would recommend doing some of the work now to avoid future implementation difficulties.
Many industry experts and organizations predict these post-consumer paint management programs will be nationwide by 2020. As is the case with any change, those who are prepared may have an advantage. It is my hope that this article may help you decide what roles you can play in paint recycling, and perhaps gain a competitive advantage. I am not going to spend a great deal of time describing the PaintCare stewardship program in detail, as more information and specifics can be found at www.paintcare.org. My focus will be on how the program has impacted my business and the community I serve.
About PaintCare Stewardship Programs: The PaintCare stewardship program is a non-profit program established to manage the reuse, recycling and proper disposal of unused architectural paint. To participate in these stewardship programs there are two basic categories of actions you will have to consider. First, is what you will be obligated to do by law as a retailer of architectural coatings and the second is an opportunity you can choose on a voluntary basis. Since the laws may vary by state I can only speak generally about which
Collection Sites: So, now you are all set up to collect fees to drive the PaintCare program within your state. Where is the opportunity to gain an advantage on your competition? While every outlet that sells paint in your state will be required to collect the fee, only a small percentage will qualify and be chosen as collection sites. Not all of your competitors, even 2
if they wanted, could be collection sites. If you are willing, and chosen, you could have access to professional contractors and consumers who would not otherwise cross your threshold. Additionally, many consumers are put off by paying a fee to a retail er who is not providing the additional service of being a collection site. Don’t sign up immediately; this decision is going to require significant thought.
write down any non-qualifying products the customer may have had in their vehicle along with the license plate number. This information can be very useful if illegal dumping becomes a problem for you. We have handed out coupons which thanked the potential customer for recycling their paint and reducing a possible hazard to the community. If you do nothing else, have your staff thank them and ask them to consider you for their next painting project.
Things to Consider:
About Belonging to the PaintCare You need to have space to store the dump bins Stewardship Program: (provided by PaintCare) which hold the collected paint. While these bins are only the size of a My strongest endorsement to participate is the standard pallet, we have 5-6 of them in rotation answer to the question I am asked over and over and they can eat up space quickly. Recycling paint when fellow retailers find out Tommy’s is a is messy collection site. business, and as The question is, a collection site “Would you make you should be the same decision prepared for the knowing then possibility of what you know leaking cans. now?” My You must be answer depends willing to train on the day. If you your staff happen to catch beyond even me on a Monday the program morning just after requirements. I discover a box They will need of miscellaneous to know how to containers of handle a unknown liquids customer who in our back is a little upset parking lot I might that you can’t rashly answer take their “no”. The other mayonnaise jar 99 times out of PaintCare Collection Site at Tommy’s Paint Pot full of what 100 I am more likely looks like motor oil as part of a paint recycling to have just received a compliment from a regular program. And on that note, be prepared for those customer who appreciates the extra service, or I customers who will just dump non-qualifying perhaps had a first time visitor exclaim how material in your parking lot. If you haven’t lost beautiful our store is, and the answer would be heart yet, inform your customers of your reasons “yes, definitely yes”. Don’t let this article preclude for deciding to be a collection site in the first place. you from asking me about the PaintCare recycling Sure you want to be recognized as an program should you meet me at a future ALLPRO environmentally conscious business which meeting. I would be happy to share more of my continually looks for ways to experiences with the program. I’ll be the one by serve the community, but you also want to sell the pool showing off my Oregon tan, wearing more paint. sandals…with socks. Be Prepared: Devise a plan and train your people on how to market and sell to those who are dropping off paint. This is the only way to make it worthwhile. Develop a short form to use during collection which gathers the basic name, address, phone or email address along with the brand and quantity of paint dropped off. Leave room on the form to
Craig Bond is the owner of Tommy’s Paint Pot in Eugene, Oregon. 3
Keeping Pace in a Recovering Economy
strong recovery in the U.S. Robert W. Baird & Co. housing update reports that as negative equity continues to recede we should witness additional spending on home-improvement projects. The update also indicates that new housing inventory has entered the market as existing single-family home inventory and new home inventory increased more than 4%. These indicators demonstrate that the turnaround we are witnessing in the paint and coatings industry is sure to continue.
by Kelley Anderson As Henry Ford once said, “Coming together is a beginning; keeping together is progress; working together is success.” ALLPRO has been in business for 53 years and began with only a handful of paint retailers. Today, our membership consists of 284 companies. It’s safe to say the ALLPRO membership has witnessed both progress and success. Although the past few years have brought a struggling economy and low profit margins, market research indicates a successful turnaround in the paint and coatings industry - one that is estimated to continue into 2014.
While these figures sound promising, first hand testimonial from fellow ALLPRO members says it all. A number of member companies have witnessed remarkable success in their business from 2012 to 2013, and a few have offered to share their success in order to demonstrate how encouraging the year ahead appears for our industry and membership in particular.
Bloomberg Business Week reports that U.S. stock market performance, resurgent housing markets, improved labor conditions and Federal Reserve reports of moderate economic expansion are positive influencers of the U.S.’s recovery in 2013. According to 55 percent of CFO’s, the U.S. economy is now poised to expand in the months ahead.
Clement Ebbo of Clement’s Paint in Austin, TX is a newer member of ALLPRO, having joined in 2011. He owns two stores and reports that both retail and commercial sales were way up in 2013. He claims “Business has never been better, we are opening a third location soon and are within a couple of days of beating last year’s sales” (quoted in September). He states that with the turnaround in the housing market and the increasing number of remodels occurring, “paint has been selling like crazy”. ALLPRO has contributed much to his success, Clement claims, as the vendor products are very popular. In particular, Petoskey Plastics, TNT Caulk, Trimaco masking paper and ALLPRIME products have been doing very well in his stores.
Even more good news, Map of ALLPRO Membership American Coatings Association has published a “U.S. Paint & Coatings Industry Market Analysis for 2010-2015” which profiles the coatings industry’s 21 market sectors over the past two years, offering analysis and providing projections for sector performance for those five years. The study found that as the U.S. continues to emerge from the effects of the 20072009 recession (when both manufactured goods input and construction spending declined sharply) the paint and coatings market is expected to respond to improvements in both manufacturing and construction with significant increases in both volume and value. Both increased domestic demand and favorable export opportunities will fuel the demand for increased US paint and coatings protection, the report says.
Anne Dages of Dages Paint in Louisville, KY reports that her business has seen an increase in property maintenance accounts in the past year. These accounts help sustain the business during the slow times of the year and are very low maintenance. Anne also reports that she has grown her business in the last year through diversification and now offers wood finishes, lacquers and stains to woodworkers and carpenters. On the retail side,
More projections include Freedonia’s estimation that world paint and coatings demand will witness a yearly growth of more than 5% by the year 2015. Market expansion will be fuelled by increased activity in the global building construction sector, with residential construction in particular witnessing 4
her company has joined a bi-local initiative, an active local business alliance named “Keep Louisville Weird”. The area where Dages Paint is located does not have a lot of franchises and is more populated with local businesses. She has been excited to see the resurgence of young people in their twenties who are supporting local businesses in the area. Dages Paint is prospering and happy to see the emergence of a young energetic group who seem more than willing to support their local businesses.
Master Select roller covers, Pro Stretch and Quick2Coat caulks, ALLPRO Blue tape with Pro-Line technology, and more. Each ad will be designed to educate the consumer on how that respective product will essentially make the paint contractor better at what they do. We’ll lead off January by introducing the new Titanium brush and Pro-Stretch caulk in The Paint Contractor and American Painting Contractor magazines. Each month that follows we’ll introduce a different ALLPRO brand product that (ideally) fits with the theme of that month’s issue. As always the call to action will be to visit the ALLPRO store locator to find the nearest retailer.
John McKenna of The Paint Shoppes in East Providence, RI stated, “We have seen considerable growth this past year in three areas: retail trade, painter trade and property management. 2013 proved to be the best year we have seen across the board since the previous economic downturn”. About 2014 John states, “Based on this year's increase in both gross profit and sales, I am optimistic that this trend will continue throughout 2014”.
For members who like to “piggy back” on these ads by offering monthly product promotions we will publish advance notice of the products to be advertised via the website control panel and bulletin board. So keep an eye out for the latest and greatest products and be sure to take advantage of this opportunity to promote and sell your ALLPRO brand.
Victor Krause of Monarch Paint in Beltsville, MD stated, “Our decorating department has shown real growth this year with window treatments and inhome services leading their way up 21 percent. The addition of new outside sales personnel in 2012 has finally shown results and sales are up over 90% over the first year. Government sales while slow and at low margins, took a major jump. We are always looking for add-on sales and in 2014 it looks like carpet [may be successful].” The ALLPRO membership has already conquered the difficult part. In the spirit of Henry Ford, we have come together, we have kept together and we are working together as a group. We love to hear when our members are successful and we hope this is the case for each and every one of you. As we continue to keep pace in a recovering economy, let’s be encouraged that the year 2014 will bring even more profit and success.
Advertising in 2014 by Scott Morath Over the past several years our advertising efforts have been to build ALLPRO brand awareness. You may recall in 2011 we ran ads that featured a cross section of our members with a message that promoted our network of member retailers. In 2012 we carried that message forward and highlighted several of the ALLPRO product categories. Last year we added a contractor testimonial to reinforce the overall message. We will continue promoting the brand in the coming year by bringing awareness to those products that are new to the ALLPRO family of products. Products such as the Titanium brush, Masterknit HD and 5
Color Club
Here are the results I have seen with the Color Club:
By Brian Eisbrenner
In 1989 Sherwin Williams had an advertising budget of $4 Million. In 2012 they spent $247 Million on advertising and the best they could come up with was a promotion that offered 40% off paints & stains. The future is looking very bright for the creative independent paint dealer. Marketing your business is only as complicated as you want to make it. The number one reason why a retail customer buys paint is to change colors. So keep it simple and track results.
Color Club
Regular Retail
Average Transaction
$118.50
$74.47
GM/Dollars/Transaction
$51.66
$34.26
New Color Club Members 3993 (2/13-10/31) I have given out 1,507 total samples and sold $21,913.43 worth of merchandise on those same transactions. My staff does an excellent job of signing up every retail customer that walks in the door. Not everyone takes a free sample but they love the idea and do come back to make a purchase.
In December of 2012 I was frustrated with my advertising results from the previous year. I had spent a lot of money advertising for a meager 2% increase in total sales. The ads worked as well as anyone’s, and the coupons we collected proved that. I couldn’t help asking what I was doing wrong.
I have had 277 customers who took samples but made no purchase. My staff follows up with everyone that does not purchase within 2 months. I have found 90% of them have hired a contractor to do the painting. The other 10% I lost to price and the hours we are open. This follow-up gives me actionable data to make improvements going forward.
I began to look at the root cause of the problem. I have a limited budget to get customers in my door and my advertising lacked frequency. Those two things don’t work well to attract a customer that is in need of my product every 3-5 years. I needed to get people to remember my stores first every time they needed paint.
My traffic counts are up 4.4% and I have seen a sales increase of 15.5% in the last 3 months. I have found the Color Club to be very successful and I hope this idea has inspired some creative thinking within the ALLPRO membership. Perhaps you can build on this idea for your business.
In February of 2013 I began our Color Club program. Members of my Color Club get one free pint sized color sample per month, for life All that is required to sign up for the club is a name, address, phone and email. On the first day of every month I email them a coupon for a free pint and the offer expires the last day of that month. Customers love it so much they buy on average 2 samples with everyone one I give away.
Brian Eisbrenner is the owner of Shelby Paint and Decorating and currently has three stores located in Shelby Township, Rochester Hills and Grosse Pointe, Michigan. 6
A: A hotel reservation must be made for each attendee requiring his/her own room.
SPRING SHOW FAQ’s
Vendor Q: When do the booth assignments come out?
As everyone is no doubt aware by now 2014 spring show prep is in full swing. We wanted to address some frequently asked questions that come up during this time. Hopefully this information will come in handy when registering for the spring show event in Phoenix, AZ taking place March 19th-22nd, 2014.
A: After we have received all the vendor registrations we will release the exhibit booth layout and provide information on how to contact USExpo to arrange your freight transport and set up. The assignment list will be provided to USExpo.
Q: When will I be able to register for the spring show?
Q: When will I get my name badge?
A: Event and registration information has already been populated on the ALLPRO website. An announcement was made on December 16th, 2013.
Vendor A: Your name badge and information folder will be placed on your assigned booth table. You may pick up your package during booth set up on Wednesday, March 19th, 2014.
Q: How do I access meeting information and reservation forms?
Member A: The ALLPRO staff will man a registration desk where you can pick up your name badges on Wednesday, March 19th.
A: Log into the ALLPRO website at www.allprocorp.com. On the main menu select the tab labeled “Meeting Info”. You will see a list of future events with the 2014 Spring Show listed at the very top. Click the “Details” button located next to the Spring Show listing. You will be directed to a page entailing all pertinent information to the show. This page will contain a button link to the agenda, which will consist of a complete schedule of events. At the very bottom of the page are two buttons: “Hotel Reservation” and “Show Registration”. These buttons direct you to two separate forms which must be filled out by each attending company.
Q: What is the registration fee for? A: The registration fee is used to offset the food and beverage cost of the show. Q: Who has to pay the registration fee? A: Any attendee over the age of 18. Q: If I sign up for the golf tournament, when will I know what team I’m assigned to? A: Golf pairings will be provided inside your folder, which you will receive on-site.
Vendors: If you are not planning on staying on-site there is no need to fill out a hotel reservation form, but a registration form is necessary for you to attend.
For any other show related questions please contact the ALLPRO office at 813-628-4800 or e-mail Kelley Anderson or Scott Morath at apc@allprocorp.com. We look forward to seeing you all in Phoenix!
Q: What if I am bringing more than one person? How many room reservations should I make?
IMPORTANT DATES TO REMEMBER … ALLPRO 2014 Spring Show & Sales Meeting JW Marriott Desert Ridge Phoenix, AZ, Mar 19 – 22, 2014
ALLPRO 2016 Spring Show & Sales Meeting JW Marriott Desert Springs Resort & Spa Palm Desert, CA, Mar 16 - 20, 2016
ALLPRO 2014 Fall Stockholder’s Meeting The Westin Michigan Avenue Chicago, IL, Oct 23 – 25, 2014
ALLPRO 2017 Spring Show & Sales Meeting The Westin Diplomat Hollywood, FL, Mar 8-12, 2017
ALLPRO 2015 Spring Show & Sales Meeting Rosen Shingle Creek Orlando, FL, Mar 18 – 22, 2015
ALLPRO 2018 Spring Show & Sales Meeting Walt Disney World Dolphin Lake Buena Vista, FL, Mar 7-11, 2018
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News and Views Constructing a New Market According to The Paint Retailer Construction spending in the US has increased for five consecutive months, with most gains coming from residential construction projects, according to the US Census Bureau’s most recent monthly survey released Oct 22. Residential construction spending rates have leaped up 28.2% from one year ago. The survey also said that total estimated spending on construction projects in the US during August was 7.1% higher than during the same period in 2012. The new estimated annual rate of construction spending is $915.1 billion. While spending on private construction is on the upswing, public construction rates are still headed downward. The rate for nonresidential private construction held steady, and total public construction spending was $274.5 billion for August down 1.8 % from August 2012. This data comes from “The Value of Construction Put in Place Survey”, the monthly survey from the US Census Bureau that estimates the total dollar value of construction work done in the nation. Reported 2013 Business Trends Each month, Northcoast Research surveys a large sample of paint retailers throughout the U.S. to get a sense for current business trends. Of the three primary architectural coatings channels (paint stores, home centers and retail distributors) the survey primarily reflects the distributor channel which tends to see volume growth less than the industry. Therefore, the results of this particular survey serve as a directional indicator more so than absolute industry volumes. The survey reports an increase of 1.3% volume of Architectural Coatings Sales in September 2013 vs. 2012. According to industry participants, average sales volumes in September rose 1.3% year-over-year and slightly contracted from the 2.5% level in August. Survey respondents tended to cater more towards the doit-yourself painter (DIY) and given existing home sales, which tends to correlate higher with DIY sales than new construction, has grown 12% this year. Results are expected to continue to trend positively. Overall, 62% of respondents witnessed an increase in volumes versus only 23% that saw volumes decline, which averaged out to 1.3% volume growth and a net increase of 39%. Social Media Marketing Getting Easier Facebook is making the lives of social media managers easier with two updates to its Page Composer announced November 20, 2013. Previously, it took 12 steps to schedule posts. Facebook has now reduced that number of steps to four, making it easier to schedule content without a third-party app like HootSuite. This update may incentivize page managers to post regularly. Last month, Facebook said its average referral traffic to media sites had increased 170% this year. The social network also reported that greater posting frequency leads to higher referral traffic.
Editor/Production Kelley Anderson
Proofers Julia Thomas Pat Brulfer Susan Nichols
Contributing Writers Scott Morath, Kelley Anderson - ALLPRO Brian Eisbrenner - Shelby Paint & Decorating Craig Bond - Tommy’s Paint Pot
ALLPRO® President Michael Gleason
Exec. Vice President Joe Poliseo
SUGGESTIONS WELCOME Your suggestions, ideas, articles and comments are encouraged.
The Scouting Report is an important communications media for ALLPRO®. Mail all correspondence to:
The Scouting Report c /o ALLPRO® Corporation 4946 Joanne Kearney Blvd. Tampa, FL 33619 • (813) 628-4800 Website: www.allprocorp.com The Scouting Report is a bimonthly publication of the ALLPRO® Corporation.
Printed on recycled paper
Painting Cancer Jim Olson, a pediatric oncologist at Seattle Children’s Hospital believes his research team has discovered a way to help surgeons operate on and remove cancerous tumors. His discovery is called tumor paint, and it is used to paint cancerous tumors. If the paint works, it would be a huge advantage to oncological surgeons. While they currently use MRI scans to see tumors, the scans aren’t able to show the tumor’s edges. Olson’s team developed a molecule that is injected into the bloodstream, travels around the body, finds the cancer cells and inserts a little molecular flashlight, making the cancer cells glow so the surgeon can see them while operating. Who knew there were so many uses for paint?