Finding the right solutions to showroom marketing issues
BY PETER SCHOR
Showroom specialist
Those plumbing and HVAC wholesalers and manufacturers that attended ish-North America and the ASA and PHCC Conventions in Chicago this fall saw our industry making some great positive strides forward in education and technology. If you have not seen in recent years what the American Supply Association has been doing to create more value, then you are missing out!
While I was at this year’s event, I also spoke at The Motivation Convention and the in-store Marketing Expo held at the same convention center. I saw a ton of new and innovative marketing and motivational tools -- so much that I could write a book on it. I highly advise you to subscribe to Visual Merchandising and Store Design Magazine (www.visualstore.com). The monthly magazine will blow your mind with creative ideas for your bath/plumbing showroom. I will be doing an article on showroom merchandising in the mid-part of 2007.
Marketing solutions for traditional plumbing wholesaler showrooms
There is a big lesson for all showrooms reading this in my response to the question from an e-mail from a prominent plumbing wholesaler with showrooms, not to be named. The e-mail said:
“We have a recurring problem in our showrooms. We have many plumbing contractors that are priced at a ridiculously low g/p on fixture items to stay competitive. These prices are not intended to be passed along to the consumers they send into the showrooms.
However, the plumbers expect the same discount whether they walk into the counter and say “Give me a Delta 400” or their customer goes into the showroom and spends hours on end with a showroom consultant. It is so bad that some plumbers are refusing to send customers to the showrooms. We try to stay at 30% g/p in our showrooms. We are in a rural area. Our showroom personnel have a bonus plan based on g/p dollars to encourage this. Do you have solutions that would help us overcome these objections from our customers? We are in a traditional plumbing contractor driven market.”
Here is my answer to the question: One of the most fundamental problems in the industry is the collective failure to educate the plumbing contractor on the “value” of the showroom from “their” point of view. Plumbing contractors, like all of us, are motivated by either “gain” or “fear of loss.” The educational process must run deep. I was teaching the plumbing contractor how to make money on the up-sell (as they called it) and also make money combining the cost of labor and fixtures in a package price. Then if the client decided to go elsewhere to buy the fixtures, the plumber would back out the fixtures at his cost and maintain the profit they lost. Yes, making money on the downgrade. I taught the plumbers numerous things like charging more to install more complicated products. Nobody told them they should make more money if it takes more time to install.
The problem also runs deep in needing to change the thought process of the executive management, outside salespeople and the showroom staff of plumbing wholesalers. Education and consulting is the answer. I know some plumbing wholesaler outside salespeople who teach the plumber how to avoid paying higher prices from the showroom effort by buying it over the will call counter. Many smart wholesalers have remedied this in recent years. There are answers as to having split commissions between the showroom and the outside salespeople. There are many ways to empower, motivate and teach how to embrace change for the plumber and the outside salesperson based on making more money. I 100% guarantee it!
In the early 90s, Connor Company, a multiple-branch plumbing wholesaler with showroom investments, based in Peoria, Ill., hired me to conduct a series of “Plumbing Contractor Success Programs” around utilizing their showrooms in partnership. I remember that many manufacturers and rep agencies supported this. Mike Warren of Added Sales was a big proponent of this “win-win” It was at a time that The Home Depot and other home centers were planning to move into the Midwest. Most plumbing wholesalers and contractors were in a fear mode and without an action plan. I had empowered Connor Company that it was truly them and their plumbing contractor partners against The Home Depot. The plumbing contractor sent the consumer into Connor’s showroom with a strong endorsement like it was the only place in the state. Connor Company protected the plumber. The plumbers were also shown how to sell up and make more money with the showrooms.
I have done many Plumbing Contractor Success programs that are 75% showroom driven and I know all of them want to make more money. If plumbing wholesalers with showrooms do not create “real value” for the plumber, the showroom has no value! It comes down to “What is your price?” -- bottom line all the time.
For those of you who are not aware, I run very deep in helping plumbing contractors. My grandfather was a Master C-36 plumbing contractor. In the early years (1987-1991), I conducted programs for plumbing contractor groups: Nationaline, The Plumbery’s, Top Line, Ph.D (The Plumbing and Heating Doctor) and many plumbing associations. I told those wholesalers who had some of these programs for the plumbers that they lacked real “value.” Their programs were more like “if you buy the products for me, I will provide you with ad copy for advertising slicks, etc. etc.” Most of these programs for the plumber partners were weak and, in time, many plumbers with showrooms in the Midwest disappeared.
Going back to the original e-mail question earlier in the article, I feel comfortable the response I shared with them because I have been in one of their showrooms. The showroom is magnificent in so many ways, yet the showroom does not have any non-plumbing contractor products on display. Some of these items that I would expect to see in showrooms are: lighted magnification mirror and lights; steam and sauna units; medicine cabinets; towel warmers; electric floor warming; drinking water systems; bath furniture/vanities; free standing towel stands; LCD mirrored TV; shower doors; and much much more! All of these products need to be purchased by someone like the consumer or builder. I know some of the Top 20% plumbing wholesalers with showrooms have a celebration when they sell the non-plumbing products at MSRP -10 to 25%, to the consumer or builder. This would bump up a showroom’s g/p from 30% to between 35% and 40%. By the way, maintaining a 30% g/p without the above-mentioned non-plumber connected products is admirable.
The last thing that would solve the problem of the plumbing wholesaler’s question was in last month’s monthly column. Plumbing wholesalers with showrooms must change the process of generating the specifications of finished plumbing and bath products after the client leaves the architect and before the builder and/or plumber is selected. Yes, new skills such as reading a 1/4-inch architectural scale and especially a 1/8-inch scale.
The builder and remodeling contractor, along with the plumbing contractor, are battling quoting pricing and budgets to compete with each other or from their assumption or interpretation of what the consumer/end user wants in their homes. This is why you always hear a disparity of prices from $50 per square foot to $200 per square foot for a custom home to be built. Each trade is competing on what they are including in the quality of plumbing fixtures on the project; each is governed or compromises their principles by being competitive by filling the client’s needs.
The Top 20% of plumbing wholesaler and dph showrooms put the entire consumer package in during the early stages and have been taught by me and themselves how to control the written specifications by either charging a fee for the services upfront or not allowing the specs to leave the showrooms. There are numerous non-offensive ways to do this. There are cities and areas like Houston, Texas, that collectively prove that consumers expect more elaborate luxury bathroom products. Once the consumer selects what they want, rarely does the plumber tell them they can’t have it. Please continue to send me questions like this via e-mail. It helps me know what you are most interested in, and allows me to provide value to you and other readers.
Peter Schor, president of Dynamic Results Inc., is an educator, motivational speaker, consultant, coach and writer in our industry and many diverse others. For the past 17 years, he has conducted 100 educational programs yearly, including 34 industry conventions. Schor has great expertise in the field of showrooms and has won many industry awards. He also works with manufacturers in the field of sales, marketing and public relations. Schor has a new book called Pillars of Success, published by Insight Publishing Company. He can be reached at 1491 Ivy Arbor, Lincoln, CA 95648, tel 916/408-5346, fax 916/408-5899, e-mail pschor@dynamicresultsinc.com or website www.dynamicresultsonline.com.