building products

Yes, price is a driver. After all, you're in the lumber business. But it's okay to slow down and present the price of a value-added product after you convince the end user of the product's actual worth. Remember the old saying, "If your price is too high, your story is too short?" To move top-end products, you've got to tell a story that explains their value.

But, before your sales team can tell that story, you need to convince them that making the effort is in their best interest. Too often, sales reps spend their days simply handing over what builders ask for without stopping to wonder, "Is this the right product for the builder to use? Is this the right product for us to sell?"

The good news is that you can change that reactive mindset. Here's a simple, three-step process that I've seen work for dozens of retailers:

(1) Commit to one product.

(2) Create an incentive-rich selling environment.

(3) Craft your story and tell it.

Show Them You're Serious

Begin by committing to a specific product. Stock it starting now, because if it's not in the yard, your sales team won't see it as important, and it won't move. Obviously, inventory dollars aren't to be taken lightly. Dead inventory can kill you, and turns are paramount. But, while gross margin retum on investment (GMROI) is critical, it has an "earn" side as well as a "turn" side. Disregarding earnsmargin dollars-will doom you just as quickly as ignoring turns.

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"1: equation. You already know the answer can never be low enough. So, if you're tired of constantly sharpening your pencil, maybe it's time to point your sales team toward value-added specialty products.

It's like the guy who bought watermelons for two dollars each and sold them for a buck. He knew he was going broke, but his solution-"Get a bigger truck"-didn't pay off.

Because margin matters, you'll want to invest in inventory that can produce margin dollars. Do your homework: Understand which value-added features each manufacturer brings to the table, in every category you sell-siding, trim, decking, railings, windows or roofing.

You already know that every category has premium players who ask for more money but deliver more value. Narrow the field to manufacturers who offer:

' Superior warranties

Innovative, time-saving products that solve real problems

. Higher quality

. Sales and marketing people who will help you tell the value story.

Sweeten the Pot

Once you've identified a manufacturer and a value-added product, and have it in stock, your next move is to create incentives for selling it. Pay always gets people's attention, so try adjusting commissions to make selling the product more attractive. Even when compensation is based on gross margin dollars, extra pay for conversions to a new product can counteract a risk-averse "bird in the hand" mentality.

For instance, a rep who's used to selling spruce trimboards to a certain builder might not want to risk tinkering with the relationship, even though the commission would be higher on trim made of PVC. In this case, your job is to make the conversions worthwhile for both the rep and the builder. Fortunately, most top-of-category manufacturers are ready to collaborate with you on rewards for reps or incentives for builders.

Spin the Tale

Okay, you've selected and stocked the right product, and set up incentives for your people and their customers. Your third and final step is to craft your story and tell it. You want your customers to believe and remember a success story: how your product helped people like them gain profitability by solving a specific problem for them and their customers.

Here again, the manufacturer is your ally. Lean on their sales and marketing expertise, but don't stop there. Ask your own sales and marketing people to develop local angles. Building products are regional, so concentrate on issues that builders face in your part of the country. Support your story with testimonials and photos of local projects, posted on your website, in social media and on in-store displays.

Get customers to listen by staging events they'll want to attend. Because builders love to buy from other builders, some manufacturers sponsor Building-Products.com live, news-you-can-use programs, presented by experienced contractors. These sessions can support your story by:

Helping you introduce a highermargin, value-added product to builders

Showing builders how to persuade homeowners that the product is desirable and that price is secondary.

Builders typically exit these gettogethers motivated to use higher-budget products, because they've gained confidence in their ability to suggest them to homeowners.

To help your team understand the product story and repeat it consistently, have them attend any training the manufacturer offers. Make sure each team member gets copies of presentations and absorbs key selling points. And ask your top outside salespeople to travel with manufacturer reps to make joint calls on builders.

After hearing the story a few times, your people will be able to recite the key features with confidence and make the conversions you need. The selling process will evolve away from price and converge on performance and value. And your bottom line will reflect the change. You'll also have a growing collection of builders who are thankful that you helped them see the Iight and are, ultimately, more loyal because you did.