100-Year-Old Flooring And Window Covering Company (design, sell and install)
This company is an institution in Wilmington, DE. Started in1912 and now in the third generation of family ownership, they had helped build most of Wilmington through the 50s, 60’s and 70s.
Events leading up to the client needing our help
Leading up to the “great recession” of 2008, they had sales of between $1.5m and $2.0m, a team of designers, salespeople, and installers. Then the recession hit and business decreased dramatically. But, the recession was not the only issue to blame, the internet, growth of big-box stores, and customer preferences were all part of the problem. When they approached us for help, sales were down to under $200,000 and just about all employees were gone. The owner was sitting in the store by himself just waiting for the phone to ring (which it did once or twice a day at most).
What we did
Technically this was a “turnaround” situation where we took a very active role. More than “coaching”, we threw significant resources (time and intellectual property) to revising this local institution. We focused on 3 things
The buying process
Generating more leads
The buying process
Understanding how clients shopped for flooring and window coverings post internet and with significant competition from big box stores meant finding a value proposition that would allow them to stand out from the competition. We focused on design and installation expertise. Price is always important but we could not compete with Lowes and Home Depot on price. Where they targeted the DIY shopper, we targeted the shopper who wanted an expert to help them from design, selection and installation.
Generating More Leads
Old advertising that just stated the name, address and phone number along with a store to generate foot traffic was not working. The store was old and tired and no longer in a major shopping corridor. To generate leads we had to go where the customers were. Through campaigns on Facebook and Houze we generated thousands of fans and shared pictures of our projects. Integrated coupons encouraged now buyers to call. Design guides offered shoppers and future buyers to learn more about our services.
We took advantage of Joint Venture Opportunities by negotiating a contract with Costco to service their customers with shop at home services. This reduced the need for customers to come to the old and tired store and brought our designers right into their homes for a customized solution that was different (and better) than the big box competitors.
People make this work, not just good ideas. We led the effort to hire on two experienced designers/representatives who were paid on commission and used the limited cash resources to outfit them with proper sales support tools so they could be effective when going into customers’ homes. The new lead generation activities kept them busy and making money for themselves and for us.
Financially, we needed to better understand who our top clients were and the profitability of each job completed. We re-organized the financial reporting systems (using QuickBooks) and starting tracking profitability at the individual job level. This allowed us to modify our proposals to focus on the jobs that were most profitable for us and that we knew we could do well.
The project took just over three years and the results were impressive. Sales more than quadrupled and the owner who originally was going to just close, could sell his business to an existing employee for a significant exit opportunity.
Rather than closing forever, the firm continues to employ a team of designers and installers, supports the greater Wilmington community, and provides for an enhanced retirement for the original owner.