The PDIS Playbook

As the 2012 Pro Dealer Industry Summit (PDIS) prepares to convene in Savannah, Ga., the nation’s housing market sits on the precipice of a long-overdue recovery. The LBM industry has watched and waited, knowing that the bottom would eventually arrive. Recognizing — and responding to — that turning point will be the subject of several seminars and presentations on Oct. 25 to 26.

An Oct. 26 keynote speech given by housing industry analyst Ivy Zelman may help attendees make some key decisions about their businesses for the next few years. Zelman, who founded her own firm in 2007 after working for Credit Suisse Group and Salomon Brothers, conducts proprietary research that involves all aspects of the housing industry. Although she was one of the first analysts to predict the depth of the housing bust, Zelman is now sounding bullish on the housing recovery. One of the positive indicators, she notes, is dwindling inventory of homes for sale. 

“There’s not enough supply, given higher levels of demand,” Zelman recently told the Wall Street Journal. “With every passing month, distressed homes are being absorbed at better and better prices.” Construction of new homes has been sluggish for years, and an increasing number of renters are choosing single-family homes, removing them from the available housing market.

In addition to sharing her forecast for 2013 and beyond, Zelman will moderate a panel of pro dealers discussing their views on improved planning in 2013.

Moving from the macro picture to the everyday running of an LBM business, the conference will feature two speakers who focus on improving operations in two key areas: negotiating and marketing.

“The One Minute Negotiator” isn’t geared toward consummating a deal in less than 60 seconds, stressed George Lucas, who will open the general session on Oct. 25. The author, trainer and consultant is focused on a one-minute strategy toward sizing up the other side of a negotiation and choosing the correct approach. 

“Most people are fearful of negotiations,” Lucas said. “They think it’s going to damage relationships.” But negotiating skills are more important than ever in the current LBM market, he added. 

“Margins are thinner than they’ve ever been, and it’s extremely difficult to win new business based on price alone,” said Lucas, whose client list includes Orgill and Rust-Oleum. “Any attempt that’s price-based is going to get the incumbent to cut their price.”

Knowing the other side’s negotiating style — i.e., collaborative, competitive, accommodating, conflict-avoiding — is always helpful when entering into a deal-making session. But Lucas can offer pointers when recognizance is in short supply. “I try to help people get their mind around a negotiation in a short amount of time,” Lucas said.

The marketing seminar at PDIS is also geared toward quick results. Brian Bunt of The Empty Bin specializes in word-of-mouth marketing for lumberyards, which means, in a nutshell, using happy customers to advertise for free. Giving them a reason to talk about your product or service is what all good lumberyards do; facilitating the conversations is what takes the extra effort.

Using examples from the building industry, Bunt will explain how to conduct a campaign that leverages a lumberyard’s core customer base and identifies its best “talkers.” In one case study he utilizes, it was the delivery drivers, who were given cameras to take photos of each load they dropped. Individual drivers were then graded as a motivation tool.

“It’s the delivery guys who really spread the word,” Bunt told Home Channel News. “They tell their friends and customers about the extra steps they take.” The cameras worked as a conversation starter. “It’s common for a customer to ask, ‘Why are you taking a photo?’ ” he explained.

Bunt doesn’t believe in traditional methods of advertising. “We try to stress that advertising is the cost of being boring,” he said. “You’re paying someone else to talk about what you’re doing.” And in a radical — and some might say “refreshing” — change of pace, Bunt doesn’t push social media; he estimated that 80% of word-of-mouth marketing takes place off line.

Instead, Bunt goes in for more offbeat and innovative promotions. Windsor Mill, where Bunt works as director of marketing, put a stamp on the back of its Windsor One trim board and moldings that said, “Call Kurt for a shirt” and included a phone number. The free T-shirt offer resulted in a number of phone calls to the head of Windsor One’s customer experience department, which then led to conversations about current building projects, materials being used and so on. In other words, a foot in the doorframe.

Bunt, who has also taught workshops at LMC and the National Association of the Remodeling Industry (NARI), promised other sources of inspiration for those who attend his hour-long seminar on Oct. 25 at the 2012 PDIS event, which is being held at the Savannah Westin. 

“At the end of the [session], they’ll be able to create a campaign the day they walk into the office on Monday,” Bunt said.