Merchandising of Building Materials

By Georse Reom

Kerckhoff-Cuzner Mill a Lumber Co., Los Angeles

Address delivered 6ebre the Annual Convention o[ the Colifornia Retail Lumbermen's Associdtion at Son Diego, November 6,7 dnd B, 1935

Mr. Chairman and Fellow Lumbermen:

I am happy to be with you today-taking an active part in this program. It is a pleasure to serve in the interests of an industry that we have chosen as our profession.

Conventions in mv estimation are of real value-an essential part of all iniustry. In a recent conversation with an executive of a large Los Angeles concern who had just returned from a meeting of their industry in the East, I asked him if their convention had accomplished anything. He replied as follows: "Conventions in my mind, George, always aciomplish one purpose or another. They offer a reasonable excuse to get away from our own business and furnish an opportunity to make new acquaintances and visit with old friends." That alone, to me, is sufficient proof of the value of this occasion.

I have been assigned to address you on "The Merchandising of Building Materials."

I am aware of the fact that many of you present know the many irregularities of this industry. Due to my contacts with both the lumber dealer and the building material dealer in the overlapping of this industry, I have observed from time to time many merchandising deficiencies.

Before we can successfully merchandise building materials today, or allied commodities along with (or without) lurnber, we must learn and practice the fundamentals of selling. I classify these fundamentals as follows:

First: Economic Selling.

Second: Scientific Selling.

Third: Active Selling.

These merchandising fundamentals are to me, in business, what the Ten Commandments are in private life.

Let us analyze the importance of these fundamentals.

Economic Selling is the knowledge of costs. The knowledge of the cost of a product, plus the overhead cost of doing business, which combined, enables us to gauge the price at which we must sell to make a profit.

We should ask ourselves under the Economic fundamental if our purchase price of this material is right. Are we buying it at the right price ?

Then let's look at our selling price. The sale of many a good product has been stifled by the fact that it has been offered at too high a price to the consumer.

Scientific Selling

Scientific Selling is the knowledge of the value and purpose of a product. Dealers must realize the necessity of carefully investigating quality, grade, durability and merits of the materials purchased for resale. Dealers who avail themselves of this scientific data are prepared to recommend suitable materials to meet the requirements of the consumer. Let's ask ourselves if we know the value of the product we are trying to sell and the purpose for which it should be used. Such preparedness creates Scientific Selling, which, gentlemen, is the most effective, because it creates satisfied customers.

On numerous occasions I have overheard conversations between consumer and dealer in our own yards as well as those of other dealers when a consumer was making inquiry about the use of a certain product and what results might be obtained. The answers of the dealer and the conversation that followed remind me of the story of two colored bo. ys, one of whom had been made a present of a new watch.

Neither of these little chaps could tell time. Both were ashamed of the fact but tried to keep it a secret from the other. StrOlling down the lane orle little colored lad hap- pened to think about his friend's watch and he called out, "Sambo, what time am it?" Sambo proudly reaches in his pocket, swings out his watch but immediately realizes his shortcoming. He holds it in the palm of his hand-takes a squint and remarks, "Dere she am," and his little colored pal also takes a squint at it and says, "Durned if she ain'L.,'

This clearly pictures to me the situation of the consumer who wants to buy something but does not know what to ask for, and the dealer having something to sell but does not know what to offer.

However, let us take the case of a well financed dealer (and there are many of them) who maintains a well stocked yard, has a host of friends-a clear knowledge of both Economic and Scientific Selling, but is really iot making a "go of it." Now what is th'e irouble in thij case ? WelI. my answer is-the lack of Active Selling. This is my third fundamental and to me one of the most important of them all. Because under the banner of Active Selling comes personal contact-the making of new friends-ad-- vertising by direct mail-pamphlets or inserts-newspaper (trade journal), radio or by display or exhibits.

Some^of you.may call Active S;lling criative selling, but to me Active is the word because cieative ideas oimerchandising are not worth much unless put into action.,Com- bine the two and there is no limit to the possibilities. . After carefully- analyzing _any product- through all of these fundamentals if the dealer hnds no deficienJies in anv of his merchandising, he then should ascertain if there wa's quality, grade, durability and merit to the product he is offering_ for resale. If he finds these features'lacking, then I would say that the merchandising trouble *", *i"ih th. p_rodr1cJ, but if he finds the produc-t to be as represented, then his trouble is in the application of merchand'ising funi damentals.

_.Gentlerqen, to me this-represents present day merchan- dising. The merchandising- of buildine materials or anv allied commodities with (oi without) limber. -.--J

The Specialist

I would like to talk to you about the Specialist. I don't want.to take anything away from Chic Saie, nor talk aioui the lrttle house in the back of the yard, but I do want to talk about the little house out on the main street_probablv right across from your place of business. pirst, l'et-us e'o Dack about htteen years and review the situation at thit ttT9., All ot.you present remember this period and any mrstakes we have made in the interim cannot be blame'<l upon our grandfathers or great grandfathers. D".i"g thi. era-,. the -average lumber dealer-was so concerned iir the s.elling of lumber that many of them felt they .;uiJ ;;t devote any time t-o -!he new substitutes that ;ere;";i;; into the market, failing to recognize that some day thesE specialties would. surely supplant s'ome of the lumber volume they were selling at the time.

In our own organi zation this lack of interest in many cases was noted by our own salesmen or others who believed that by taking these new incoming items they could establish themselves in business and render a more Scientific or Active Selling service.

Out of all this came many of today's building material dealers and they are established in as industry that must be recognized by our trade associations and we should endeavor to cooperate with them to the fullest extent.

Right now the question confronting us is what are we going to do about the incoming of more specialists; specialists in wallboard lines,.insulation lines, plywood panel lines, roofing and numerous other items? Any one of w'hich may be developed into a separate industry that sooner or later would also have to be recognized.

In a recent survey it was estimated that 55 per cent or more of the lumber dealer's business is in the volume of building materials and allied commodities. If we are not alert and better prepared to offset the incoming of these new businesses we are surely going to lose and continue to lose more and more of a business that should rightfully be ours.

Our weakness may be in our failure to recognize the importance of these new substitutes by not giving the manufacturer through our channels of distribution the volume they should have which encourages them to build up against us on the outside.

Personally I am positive most of our weakness lies in the lack of the proper application of merchandising fundamentals which I have outlined-particularly in the Scientific and Active classifications.

I only hope I have awakened in your mind a more careful observation of the trend of new materials being used in daily construction and the fact the manufacturer's research departments are working night and day which is bound to bring out additional items on the market which we today are not aware of. The lack of this ob'servation on the part of the lumber dealer reminds me of a story of a young doctor who had just graduated from medical school (Story.)

All right, all right. In quieting your laughter I want to remind, you that the mirth of this story is one that clearly .represents our own weakness in our lack of observation and 'is a laugh at our own expense. I would much rather stand here and address you at a later date and laugh with you over the fact that we have been able to put over some clever scheme that may help solve these common problems that are confronting us in our merchandising.

My time is up. If, in my address, I have created an inspiration of real keen desire on the part of any lumber dealer towards greater achievement in the merchandising of building materials or allied products (with or without lumber) I am happy.

Retailers Play Golf at Convention

The California retailers' golf tournament, one of the features of the State Convention in San Diego, was held at the LaMesa Country Club, LaMesa, Thursday afternoon, November 7, and brought out'38 golfers. E. E. McCormick, McCormick Bros., San Diego, with a score of 75 won the low gross prize. C. E. Irving, \Mestern Lumber Co., San Diego, was the second low gross winner with a score of 76 The first blind bogey prize was won by Ed. Martin of "The California Lumber Merchant" with a score of 73. The second blind bogey prize was a five-way tie-L. A. Beckstrom, MacDonald & Bergstrom, Inc., Los Angeles; George O'Brien, O'Brien Salvage & Wrecking ,Co., San Diego; F. C. Gutshall, Paraffine Companies, Inc., San Diego; Henry Hink, Dolbeer & Carson Lumber Co., San Francisco, and Lew Hackett, The Celotex Co., Los Angeles, each with a score of 76. H. G. Smith, East Side Lumber Co., San Diego, with a score of 111 was the high gross winner.

Prizes were donated by the U. S. Gypsum Co.; Schafer Bros. Lumber & Shingle Co., Chas. R. McCormick Lumbet Co., Tacoma I umber Sales, and Dolbeer & Carson Lumber Co.

E. E. McCormick won the Redwood Golf Tournament Trophy which was awarded by J. H. Holmes of the Holmes Eureka. Lumber Co. His name will be engraved on the cup and he will have possession of the trophy until next year's tournament

A buffet supper was served in the Club House following the tournament and the balance of the evening was spent in playing old fashioned games under the dirbction of Frank Park, Park Lumber Co., LaMesa. Ed. Culnan, Western Lumber Co., San Diego, was master of ceremonies and announced the prize winners. The LaMesa Hill Billies furnished music during the evening. The following played in the tournament: Al Swenson, George O'Brien, Frank Messager, Carl Gavotto, "Bud" Rinde, P. S. Johnson, John Pennington, Gene Zeiss, Bill Jennings, F. C. Gutshall, E. E. McCormick, Charlie Chapman, G. G. Christian, Bob Reid, D. C. Essley, H. G. Smith, Fred Holmes, J. H. Holmes, Chas. Lyons, Francis Boyd, C. E. Irving, "Rust" Gill, Dick Loveday, P. W. Chantland, Ed. Seward, Duncan McNeil, Llenry Hink, Lew Hackett, Jim Block, Tom Crain, L. M. MacDonald, Robt. Forgie, L. A. Beckstrom, Ed. Martin, Merle Baker, Ben Buisman. C. V. Harrington and Harry Graham.