In the world of sales, there are often no right answers. What would you do in this tough sales situation? Make the call below, and see instantly how your judgment compares. Final results will appear in LBM Journal. Be sure to check back next month for a fresh Tough Call.

Tough Call - Building Deck Profits

 Your fledgling installed deck program faces serious obstacles.

With new home starts in your market still feeling the effects of the Great Recession, and remodeling projects doing not much better, you’ve done what any smart sales manager would do. After spending much of February studying your market and your competition to look for undiscovered opportunities, you found several potential areas to explore. The fact that neither you nor your competition were selling decks on an installed basis stood out as a clear opportunity. Having discovered an underserved niche, you set about filling it.

First, you shared everything you learned with the owner. You showed how your decking sales had grown steadily over the past decade or so before flattening out since the slowdown. You did some research into installed sales, and learned that a well-run, successful program would have a number of benefits for your company—including higher sales and margins, potential to attract new customers who’d never shopped your store, and the opportunity for incremental add-on sales. From your perspective, there was no downside. It all sounded good, and being the master salesperson that you are, convinced the owner to go all in.

The past month was a whirlwind. After analyzing your existing lineup of decking products, you added two new brands to make sure you have the right mix to meet any budget—from entry-level to ultra-luxury.

You tweaked your fastener assortment, making sure to stock the recommended fasteners for each brand of decking you carry—along with several hidden fasteners.

The deck builder you hired to create displays in the showroom and outside by the parking lot did such a great job, you hired him to run your new installed decking initiative. He’d just shut down his own deck-building company, and so the timing for both of you couldn’t have been better.

All started off well enough. You tested the waters with a couple of small ads, promoting to homeowners that your store is the area’s only one-stop-shop for decking.

The response was encouraging. After less than a month, you’ve sold several installed deck projects—and, so far, the homeowners have been very happy with the result. And hey, if they’re happy, you’re happy. Unfortunately, there are challenges.

First, several professional deck builders have let you know, in no uncertain terms, that they don’t appreciate having to compete against their supplier and will likely be taking their business elsewhere. Second, after running the numbers on the first few installed deck sales, you think you know why your new deck-builder-turnedinstalled- sales-manager’s company went out of business: the prices he charged were woefully inadequate to cover the decking, fasteners, flashing and other materials not to mention the cost of his labor and your overhead. When he assured you that “we’ll make it up in volume,” you knew you had a problem.

Not only are you on the verge of losing pro decking customers because of perceived competition, the manager of your installed initiative is digging in his heels on the pricing— refusing to charge more than he thinks is “fair.” What would you do?

 

	RAISE PRICES
	With your company’s name backing your deck sales, you deserve to charge a premium. Don’t devalue your brand by being the cheapest in town.
	RESTRUCTURE
	A skilled craftsman does not a manager make. Take over managing the installed sales, and let your deck builder focus on what he does best: building decks.
	PRO DISCOUNT
	To get deck builders from taking their business elsewhere, be sure that the discount you offer them is equal to or greater than what the competition offers.
	DO ‘EM ALL
	Each of the above answers are equally important to ensure that your installed decking program is a winner for your company and your customers.

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